On May 25, 2017, Annie Fadely writes on Civic Skunk Works:
Why do wealthy people spend so much time shaming the rest of us?
The 90% of us who haven’t managed to hoard 76% of the wealth in Americaare often written off, especially by Republicans, as having character flaws that prevent us from making choices that would lead us to being a Rich Person. In response to the GOP’s savage proposed cuts to health care, Rep. Jason Chaffetz (R-Utah), gifted us with this insight:
“Americans have choices. And they’ve got to make a choice. So maybe, rather than getting that new iPhone that they just love and they want to go spend hundreds of dollars on, maybe they should invest that in health care.”
The working class is constantly being informed of their supposed deficiencies in a way loosely packaged as mentorship.
Wealthy men and women alike tell less wealthy women to forcefully negotiate their salaries. Rich people with degrees tell poor people to get degrees (and then more advanced/more prestigious/STEM degrees). Of course you’re not building wealth, they say. You’re not even investing. And if young people do manage to save a few bucks but still find the price of housing insurmountable, they’re told to buy fewer avocados (which many of my peers can’t afford to even lust after in the grocery store).
What they’re really saying is to be born luckier. To make yourself whiter. To be more like them. And if you can’t, you’re probably just lazy.
But we know that climbing the next rung on the economic ladder isn’t simply a matter of hard work and tenacity. The unwillingness of the working class to take chances on the stock market and flit around between tech startups isn’t a collective defect — it’s an attempt at self-preservation. We can’t afford to take risks that might reap grand returns. When 69% of Americans have less than $1,000 in savings, the stakes are just too high.
The allure of building wealth isn’t to satisfy our material desires. What we’re lusting after is the peace of mind that we suspect comes along with knowing that our current and future well-being isn’t dependent on things going right all the time. And rich people? They don’t have to worry about that. As a result, their perceptions of risk-taking are seriously askew.
Our friends who make it to college and land jobs at Microsoft won’t have to watch their parents decay in a dismal Medicaid-funded nursing home (or on the street, if Trump’s budget gets its way). Barron Trump won’t join the masses who are tweeting at Nicki Minaj for the chance to get a fraction of his school bills paid. And he won’t have to set up a GoFundMe campaign to finance treatment for a pre-existing condition, because dying of something curable is for suckers — poor suckers.
Most people who have experienced wild financial success just don’t understand this reality. Peter Wehner of the Ethics and Public Policy Center (a Christian conservative who has served in the last three Republican administrations) thinks that the inability (or unwillingness) to acknowledge objective truths like these has spread from academia into politics and society at large. He calls it moral confusion.
The comfortably wealthy don’t know what it’s like to be perpetually confined in a terrifyingly low economic bracket, because the one thing they all have in common is that they escaped — sometimes by birth. And they can’t accept that they might not have done so by way of their own brilliance or the merits of their ancestors.
For the rest, the American dream eludes us over and over again. Because social and economic suppression share overlapping root causes. And it’s really simple for the powerful to keep it that way.
Here’s an example:
Seattle used to have a method of housing segregation called redlining. The whole city was drawn up with racial borders that were written into neighborhood housing deeds. Redlining dictated what kinds of people banks would approve for home mortgages in certain areas, and it worked very well at keeping undesirables out of Seattle neighborhoods (except for Central Seattle, where white people didn’t want to live).
Housing deeds in my neighborhood, Ravenna, used to contain this phrase:
“No person other than one of the white race shall be permitted to occupy any portion of any lot in said plat or of any building thereon, except a domestic servant actually employed by a white occupant of such building.”
The definition of an undesirable varied by neighborhood. People cut off from any real estate worth having included “Hebrews” (Jews), “Ethiopians” (Africans), “Malays” (Filipinos), and “the Asiatic race”. Clyde Hill was restricted to “Aryans only”.
Redlining isn’t just some backwards practice that we left behind in the last century. Homeowners associations couldn’t change the discriminatory language in their deeds until 2006, when Senate Bill 6169 was passed to allow it. And even though the words were changed, the segregation of neighborhoods in Seattle is still in full force — just harder to name now. It takes funding to run studies that identify the housing discrimination based on race, national origin, sexual orientation, and gender identity that so many people can tell you is definitely a thing. And money isn’t exactly pouring in to find out such non-sexy things.
But the way our society is set up means that the wealth of your neighbors defines your trajectory. Because our state funds schools through local property taxes, where you buy or rent a house dictates exactly what quality of education your kids will receive. And later, the value of your estate that will be passed on to them. Your assets are exactly the size of your safety net.
It’s hard to know if policies meant to mitigate social discrimination are working. A trailblazing study by my badass professor Marieka Klawitter, the guest on our podcast this week (link below!), suggested that the first thirty-ish years of workplace anti-discrimination LGBT policies (no Q or I or A yet) did diddly-squat for lesbians. The strongest effects were found for gay white men in the private sector who already placed in the upper half of the earnings distribution — individuals with lots of other social bargaining power to draw from.
We can’t solve economic insecurity if we don’t talk about it with brutal honesty. Commiserating over dream houses and vacations is an easy and acceptable form of envy to share with our fellow Poor People. It’s much harder to admit to ourselves and others that what we’re actually scared of is remaining vulnerable.
So let’s all call it exactly like it is, really loudly: the objective truth is that our economy and society are working in tandem to keep the suppressed exactly where they are. The attainability of moving up a couple rungs on our sections of the economic ladder keeps the subtler suppressions under pretty good wraps, and it’s working really well for the rich and powerful. More for them.
https://civicskunk.works/the-blinding-effects-of-being-really-really-rich-8f76af74ddec
This is an excellent article about the economic reality that is the result of economic inequality.
Sadly, whether consciously or unconsciously, multi-millionaires and billionaires are “hoggist” capital owners propelled by greed and the sheer love of power over others. “Hoggism” institutionalizes greed (creating concentrated capital ownership, monopolies, and special privileges). “Hoggism” is about the ability of greedy rich people to manipulate the lives of people who struggle with declining labor worker earnings and job opportunities, and then accumulate the bulk of the money through monopolized productive capital ownership.
All wealthy people part of the problem. The exponential disassociation of production and consumption that is the problem in the United States economy, and the reason that ordinary citizens must gain access to productive capital ownership to improve their economic well-being.
Anyone who seeks to own productive power that they cannot or won’t use for consumption are beggaring their neighbor — the equivalency of mass murder — the impact of concentrated capital ownership.
People tend to delude themselves when they think that multi-millionaires and billionairers are on the side of reforming the system and broadening capital ownership simultaneously with the growth of the economy. If they were for inclusive prosperity, inclusive opportunity and inclusive economic justice they would have acted long ago. They continue to remain silent, yet knowing they are rich because they OWN wealth-creating, income-producing capital assets, and the 99 percent do not, whether through luck, inheritance or hard work and good decision-making.
If the wealthy class truly wants to for an economic just society they would become an advocate for reforming the system so that future capital formation is financed with insured, pure interest-free capital credit, repayable out of the earnings of the investments.
The rick know why they are rich, yet they do not put their minds to reforming the system to implement financial mechanisms that do not require past savings as capital credit loan security or collateral. They perfectly understand the logic of corporate finance that investments must pay for themselves. They have the influence and political power to completely reform the system to provide equal opportunity for EVERY child, woman and man to acquire ownership stakes in future capital formation growth, without the requirement of past savings or taking anything from those who already own.
The wealthy capital ownership class needs to understand that the purpose of production is consumption. So how do you increase consumption? The obvious answer is if you want to increase consumption, you must increase production.
Consumption drives everything in economics, and if people don’t have the means to consume, they have no means of participating in economic life. When people hoard the ownership of wealth-creating, income-producing capital assets they cause production and consumption to be out of balance.
The challenge is to empower people to gain the ability to consume by being productive. As the logic of Say’s Law of Markets has it, if you want to consume something, you must either produce it yourself, or produce something to trade to someone who produced what you want to consume.
How you produce something is, ultimately, irrelevant. Human labor and non-human capital are all productive in the same sense. The only problem in the modern world is that while everyone owns labor naturally, most people don’t own enough capital to produce enough for them to consume, and capital is vastly more productive than human labor — and, just as what human labor produces goes to the owner of human labor, what capital produces goes to the owner of capital assets.
Binary economist Louis Kelso, however, made what seems the obvious observation, that if owners of labor alone don’t have enough, and owners of capital have enough, such as a Warren Buffet and other multi-millionaires and billionaires, why not figure out some way that owners of labor can also be owners of productive capital . . . without taking anything from current owners of capital?
Kelso figured out a way to do so: using the techniques of “modern” finance it is possible to purchase newly formed capital that pays for itself out of its own future production, and thereafter yields enough production either for the owner to consume directly, or trade for what he or she wants to consume that is produced by others.
The wealthy capital ownership class should understand this basic concept, but instead choose to hoard more and more capital wealth. The so-called 1 percent rulers of corporations have rigged the financial system to enable this already rich ownership class to systematically further enrich themselves as capital formation occurs and technological industrialization spreads throughout the world, leaving behind the 99 percent to depend on income redistribution, with their jobs being destroyed and thew labor’s worth being devalued as a result of tectonic shifts in the technologies of production and globalization (seeking lower cost production).
Multi-millionaires and billionaires, who already own productive capital, systematically concentrate more and more capital ownership in their stationary 1 percent ranks. Yet the 1 percent are not the people who do the overwhelming consuming. The result is the consumer populous is not able to get the money to buy the products and services produced as a result of substituting machines for people. And yet you can’t have mass production without mass human consumption made possible by “customers with money.” It is the exponential disassociation of production and consumption that is the problem in the United States economy, and the reason that ordinary citizens must gain access to productive capital ownership to improve their economic well-being.
The wealthy capital ownership class should understand that as long as working people are limited by earning income solely through their labor worker wages, they will be left behind by the continued gravitation of economic bounty toward the top 1 percent of the people that the system is rigged to benefit. Working people and the middle class will continue to stagnate, resulting in a stagnated consumer economy. More troubling is that this continued stagnation will further dim the economic hopes of America’s youth, no matter what their education level. The result will have profound long-term consequences for the nation’s economic health and further limit equal earning opportunity and spread income inequality. As the need for labor decreases and the power and leverage of productive capital increases, the gap between labor workers and capital owners will increase, which will result in turmoil and upheaval, if not revolution.
Multi-millionaires and billionaires should be committed to a just and economically classless market economy, true equality of opportunity, and a level playing field in the future for 100 percent of Americans. By adopting economic policies and programs that acknowledge every citizen’s right to contribute productively to the economy as a capital owner as well as a labor worker, the result will be an end to perpetual labor servitude and the liberation of people from progressive increments of subsistence toil and compulsive poverty as the 99 percent benefits from the rewards of productive capital-sourced income.
