On November 21, 2019, Umair Hague writes on Eudaimonla:
There’s a strange and terrible thing that’s happened to our societies. You already know it, because you might well be living it. And yet it goes largely unremarked upon. It’s become more or less impossible to live a decent life by doing an honest day’s or even career’s work anymore — let alone a good one. You can’t live a decent life anymore just by being an average, regular, normal person, with an average, regular, normal career, job, income, at all — not even close — the way that past generations could.
What do I mean by that? Well, I think you have an inkling. But let me explain anyways, in hard economic terms. Nobody — and I mean nobody — can afford a decent life on an average income anymore. It’s not just you. A decent life: healthcare, childcare, elderly care, retirement, education, a little investment in yourself, a little savings. You can’t — cannot — have all of those on an average income (which is about $60K) anymore. It is flatly impossible. You can’t even accomplish half the list on an average income. People might tell you they are — but they are lying, for the sake of pride. The numbers say it is impossible to live a decent life by doing an honest day’s work anymore. We’ll do those numbers precisely in just a moment. No wonder it feels like our society is collapsing.
An honest day’s work. That simply means something like: the humble teacher, plumber, carpenter, middle manager, the small business owner, the minor-league entreprenuer, the yoga-studio teacher, the branch manager, the team leader. Just..the average Joe. The nobody. The people who put in day after day of…honest work. Real work. Genuine work. They make things and do things and create things and tend to things. Sometimes, children, sometimes, homes, sometimes, stores, sometimes, roads and bridges and pipes and teams of people and ideas and so forth. I could go on with that list — it’s just the tip of the iceberg — but perhaps you get my drift. The average person is just the one walking down the street, invisibly, by your side.
And yet, the truth is that if you’re one, you’re not just struggling: your whole life is a perpetual struggle, which feels like it’s unwinnable. Is that feeling right? How do I know it’s there? Because, well, the statistics — which are truly nightmarish to an economist — tell me so. And so does my lived experience. More than half of Americans struggle to pay basic bills, like housing, healthcare, and utilities. 70% live paycheck to paycheck. 80% can’t raise a small amount for an emergency. These are things that should ring out like alarm bells. They tell us that living a decent life by doing an honest day’s work has become flatly and absolutely impossible for the average person.
You can try, sure. As most of us do. But the truth is that the game is impossible to win, on average.The next statistic worth considering is that the average American dies in debt. How much debt? About $70K. To an economist, that means they never effectively own, save, or earn anything. Not a single penny. They don’t just die broke — they die less than broke. So you can try all you like to live a decent life by doing an honest day’s work. But the terrible truth is that your chances of succeeding are incredibly slender, at best. More like nonexistent. The odds are a little bit like winning the lottery. On average, you’re going to…be a pauper. The game is rigged. That sense that you can’t ever win isn’t lying, in other words: its telling you the harsh truth.
We’ve built a casino economy, in other words. You might win big — if you’re incredibly lucky. But most people will walk away poorer, just for having played. What the? Let me translate that. An honest day’s work is rewarded with…becoming a pauper, going broke, dying in debt. Just like at a casino, the average person never wins a penny. They only lose.
How does it feel to live a life like that? It feels — if we’re honest — terrible. Most Americans are perpetually, constantly worried about money. “Worried” is an understatement, though. Panicked, embittered, frustrated, furious, resigned, fatalistic, depressed. All of that, too, shows up in the statistics, should you need them. America’s suicide rates and depression rates are skyrocketing — precisely in those areas and for those professions in which an honest day’s work is rewarded with fresh poverty, like the rural farm belt, or the abandoned Rust Belt. Americans aren’t just a little bit upset about never having enough money to live on. It is killing them, at a social level.
But the casino economy isn’t just made of the average person who walks away poorer. Who really makes money at a casino? Not the high rollers or the whales. The house. And that’s exactly what’s happened in our economy, too. The only way to win is to be the house. The one that’s organizing this bizarre state of affairs, that’s making it, that’s creating it.
So if you work on Wall St, you make a packet. If you run a “hedge fund” — I put it in quotes because it’s just money laundering at this point — you make more than a thousand teachers do. If you work for Google, Amazon, Facebook, or Tinder or Uber — and you’re not one of the legions of subcontractors, but one of the upper management — you make a killing. In all these professions, earning less than multiple high five figures halfway through a career is hardly unusual, and being showered with millions is just being an average performer.
But all these companies are the house of the casino economy. They make it go. They are the ones who’ve created the roulette wheels and the craps tables the rest of us are forced to play at, in the hopes we might one day win something at all. Facebook blew up news and media. Google blew up advertising and TV. Uber blew up transportation. And so forth. Surreal numbers of jobs have simply…vanished. Entire industries are now…gone. Yet what replaced them weren’t newer, better jobs, at shiny new companies and industries. But something very much like a casino.
(The only portion of the economy that’s really growing job-wise is what economists call “service jobs.” That’s a polite euphemism for something like: “being a servant to the new super rich.” So you can take your chances being an Uber driver, and ferry around the new bourgeoisie of Facebook and Google employees. Or you can take your chances trying to sell stuff on or deliver stuff for Amazon. But you’ll live a vastly worse life than your parents, or even your grandparents. The statistics say that, too — American living standards are cratering, and mobility has plunged.
That’s because none of these jobs are really “jobs.” They’re gigs, or they’re tasks, or they’re “opportunities.” But they’re not jobs, with benefits, like healthcare, pensions, leave, protections, guarantees. What they’ve really done is reduce people right back to piecework — being paid by the task or object or gig — but that’s what used to happen a century or two ago, before modern economies existed at all. So these new jobs which aren’t jobs — call them anti-jobs if you like — are a form of profound and severe and swift social regress. Perhaps it’s no surprise we’re regressing politically, when our economy seems headed at light-speed back to a Dickensian dystopia, made of a tiny number of Scrooges — and legions of Tiny Tims.)
Because these new jobs-which-aren’t-jobs exist at gigantic monopolies — Google, Facebook, Amazon, etc — there’s a second reason it’s become impossible to earn a decent living doing an honest day’s work. Giant monopolies aren’t exactly known for paying taxes. Amazon paid less in taxes than you did last year. Wait — Amazon’s literally worth about a trillion dollars. How much are you worth? Your real net worth is probably negative, like most Americans. And yet there you are, paying more taxes than most of the economy’s biggest companies. What the?
Now, since the tax base has been ripped to shreds — since these giant monopolies pay basically nothing, and neither do their “owners” — the result is that society can’t then invest in the very people who need to be protected. It can’t support people who an honest day’s work and give them decent lives, because these ultra rich entities aren’t paying their taxes. So who’s going to pay for that healthcare system? That retirement system? That childcare system? Nobody. That’s why we don’t have them.
But because we don’t have these great social support systems, it’s become doubly impossible to live a decent life on an honest day’s or whole career’s work.Maybe you could scrape by on that dismal teachers’, professors’, middle managers’ income — if you just had some support. If you had a little help with childcare. Or taking care of your aging folks. Or if your retirement was already sorted.
Remember what I said at the beginning — that we’d do the numbers? here they are, and they’re pretty simple. Nobody — nobody — can afford to pay for a) healthcare b) childcare b) education c) elderly care d) retirement e) housing, food, and daily expenses on the average income. Nobody. It is flatly impossible. The average income’s around $60K. Healthcare for two people is $10K. Childcare’s another $10. Elderly care, another $10. Education, easily another $5-10K. Wait — that’s already more, far more, than an average person’s after tax income. Savings? Forget it. A decent life is flatly impossible for the average person.
No wonder America’s become a rich society of poor people. No wonder the average person dies broke. No wonder society’s riven by an atmosphere of despair. No wonder suicide and depression are skyrocketing. It has become impossible to live a decent life by doing an honest day’s work.
Now, you can have a decent life. But there’s a catch. The only way that you can live a decent life anymore is to join the house. To become not a player in the casino economy — but part of the casino itself. Go work at a Google, Facebook, Amazon, Uber, or on Wall St, maybe in lobbying,. and so on — and hope that you’re lucky enough to turn into a “full-time employee”, and keep that job.
But that’s not really an honest day’s work. In what say? Do you think that’s harsh? But we’ve already covered how these companies aren’t doing honest work. They don’t pay taxes. They’re responsible for serious and growing levels of abuse and exploitation. They promote inequality. They reward people the most for finding loopholes and tricks and little cons as ways to make yet more money. So working for an Amazon or Google or Facebook isn’t an honest day’s work in the same way that being a humble teacher or a local councillor or a plumber is. It might not always be a dishonest day’s work — but certainly it is, a lot of the time. It has to be. How else do these monopolies get away with all the bad things they do that we’ve become so accustomed to? Amazon mistreating its workers, Facebook literally shrugging off propaganda, Wall St needing mega bailouts like clockwork while running old and storied companies into the ground?
Sorry — none of that’s really an honest day’s work, my friends. But in the casino economy, it’s the only left way to get ahead. It’s the only way to make a decent living anymore. You become the house — and watch the suckers gamble, hoping, desperately, one day, maybe today, this bet will pay off. Maybe if I take this gig, this opportunity, this chance, I’ll finally be able to pay all my bills. You become the house, and watch the average person, whom you regard as a sucker, simply fall apart. Because maybe you know the terrible truth.
Earning a decent living on the average income is impossible. The game really is rigged. There’s a reason nobody ever seems to win. You can’t — unless you hit the jackpot. But on average, walking away richer than when you entered cannot happen. The average person loses in our economy by design.
That might sound like an analogy — but it’s not. It’s a fact. Nobody — nobody — can pay for the stuff of a decent life — healthcare, childcare, retirement, elderly care, education, let alone vacations and leisure and investment in themselves — on an average income anymore. It simply isn’t possible. Sure — there are many people who pretend to. But the truth says otherwise. They are just fooling themselvess, and maybe a few neigbhours. Late at night, checking their bank balances, they probably feel much the same thing you do. Panic, fear, frustration, resentment. Heart-stopping anxiety, stomach-numbing powerlessness, dizzying helplessness. The terrible, fatalistic sense that you can’t win.
That sense is telling you something very, very important. It’s not you. You really can’t win because nobody can.
The economy needs profound transformational change. And it needs it now. Because, my friends, when it becomes impossible to live a decent life by doing an honest day’s work — then people must stoop to becoming dishonest. Societies implode that way. Russia did. Weimar Germany did. They end up run by mafias. The most violent rule.
If that isn’t the future we want, our highest priority must also be our simplest. It should be not just possible, or even probable, but certain — that you can live a decent life, by doing an honest day’s work.
Gary Reber Comments:
For ordinary Americans to earn an income to live a decent life, EVERY American must become an owner of wealth-creating, income-producing capital assets.
Let me explain the economics preventing EVERY American from earning income generated from productive capital asset ownership.
Virtually all economists, who should know better, believe the only way to finance new capital formation is by reducing consumption and accumulating the excess production in the form of money savings. This is what the wealthy capital asset ownership class (millionaires and billionaires) can do, while ordinary Americans can barely meet their financial obligations week to week and month to month.
Economists and commentators subscribe to the idea that you cannot produce anything until you have produced something. If there can be no production without first saving, and saving is defined as consuming less than is produced . . . where did the first production come from out of which to save?
In economics, “income” and “demand” are the same thing, and assuming there is no artificial manipulation of demand and everything else being equal, production equals income. Yet economist continue to insist that only labor generates “effective demand,” and thus only labor is productive, completely ignoring the reality that non-human things are productive as well. The reality is that most changes in the productive capacity of the world since the beginning of the Industrial Revolution can be attributed to technological improvements in our capital assets, and a relatively diminishing proportion to human labor. Technological change makes tools, machines, structures, and processes ever more productive while leaving human productiveness largely unchanged (our human abilities are limited by physical strength and brain power — and relatively constant).
Because technology can outproduce human labor, far more is produced by people working with machines than can ever be consumed. The fact is capital, the non-human factor, is productive as well as labor. Income from production by capital is the equal in every way as income from production by labor. Thus, the belief that the only way to be able to consume is to have a job that pays a wage is a false belief, as the owners of productive capital assets generate capital wealth incomes.
It is a falsity that savings must first be accumulated to finance new productive capital formation and everybody needs a job because jobs are the only way people can produce to consume. Instead, because machinery is producing more goods than human labor, it should be clear that human labor is not as important to production as capital. People produce with both labor and capital, not labor alone. And increasingly, we don’t need human labor to produce; capital, virtually alone can produce.
This leads to the question of how is capital ownership accumulated? The reason the vast majority of Americans do not own productive capital is because they are not able to use credit the way the rich do to buy capital that pays for itself out of its own future earnings, then pays income to the owner of the capital once the original acquisition cost is repaid. The fact is you don’t need existing savings to purchase capital that pays for itself out of its own future earnings.
Money can be created as needed by backing banknotes — new money — with the value of existing or future wealth. The only thing holding back economic development and production is the lack of financially feasible productive projects and the demand for collateral to ensure the creditworthiness of borrowers so that the new money can be repaid and cancelled.
To stimulate demand, we need to make people who are not productive, productive! But how, when the vast majority of Americans have no savings to invest and no collateral to ensure their creditworthiness as capital credit borrowers? As a result, does it necessarily follow that if an individual or a group of individuals has nothing at the moment, that same individual or group can never have anything, even if others have all they want or need?
The answer is no. The solution is to arrange for those who have nothing to have something — without taking it from anyone else. All it takes is a good idea and the ability to put the idea to work. Thus an individual or group can start with nothing, and build wealth and income by financing new capital wealth without using existing savings and without taking wealth away from somebody else.
As concentrated capital asset ownership has concentrated among a tiny wealthy capital asset ownership class, the tax base has degenerated as people’s real incomes for their labor have declined. Significantly then, no matter how much labor is necessary or unnecessary, it is imperative that the issue of concentrated capital ownership is addressed, and policies are enacted to create new capital owners of the corporations growing the economy, both established and viable start-ups, simultaneously with the economy’s growth.
For an in-depth overview of solutions to economic inequality, see my article “Economic Democracy And Binary Economics: Solutions For A Troubled Nation and Economy” at http://www.foreconomicjustice.org/?p=11
