Tag Archives: Wealth Disparity

Slaves and Bulldozers, Plutocrats and Widgets

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By Kristine Mattis

Source: CounterPunch

There is not an industrial company on earth, not an institution of any kind – not mine, not yours, not anyone’s – that is sustainable. I stand convicted by me, myself alone, not by anyone else, as a plunderer of the earth. But not by our civilization’s definition. By our civilization’s definition, I’m a captain of industry and in the eyes of many, a kind of modern-day hero.

— Ray Anderson, (1934-2011) CEO of Interface, Inc.

We are living a collective illusion known as the civilized world. We feign concern for our horrendous conditions of poverty, socioeconomic inequality, deteriorating public health, and severe environmental degradation (to which climate change is merely one factor), but everything we do belies that distress. These issues comprise the largest risks to the survival of the human species, as well as the most significant amoral atrocities on the planet. Both individually and as a species, our health, safety, and ability the live a decent, dignified life have always been imperiled by these predicaments. Yet, we continue along with complete cognitive dissonance in that the crux of our lives – our jobs, our consumer culture – all contribute to, perpetuate, and exacerbate the unsustainable and morally reprehensible conditions of our existence. But while we are all marginally responsible for the multitude of calamities befalling us, the one group who bears the brunt of the blame for our social and ecological decay is the wealthy.

Have you looked around and seen just what humanity has done to our stunning Earth? We’ve bulldozed the beauty for bucks. Far too much of what was once a glorious paradise is now a complete disaster of unfathomable proportions. A disaster wholly of our own making. In America, and in most places around the world, from the moment we are born we are preparing for a future career, and  more specifically, for the lifelong goal of making money. But on the whole, most of the jobs we do end up being more detrimental than beneficial to society and the environment. We characterize work through measures of productivity, but producing more and more unnecessary, meaningless, and often useless products compromises our physical environment, which in turn, compromises the health of humans, other beings, and our entire planetary ecosystem.

So many of the things that form the basis of our civilization should not, and perhaps cannot, exist in a just and sustainable world. Items like arms and artillery, synthetic chemicals, concentrated animal feeding operations, plastic, smartphones and other electronic gadgetrydo not feed a sustainable and equitable world but create more needless havoc. The irony, though, is that the very people who run the systems that incessantly construct and promulgate these harmful, redundant, or unnecessary products are the richest and most successful people on earth.

We define success in our society almost exclusively in terms of wealth, with its attendant power and sometimes, fame. Rich people are the recipients of adulation and reverence for nothing more than their accumulation of wealth and material products. We like to think that riches come by way of great intellect, talent, skill, and a strong work ethic, but in reality, monetary success is more a matter of inherited socioeconomic status, ambition, and determination, rather than ability and aptitude. Most of all, to achieve wealth means to have a myopic resolve, not only to look away from how the sausage is made, but to not care how the sausage is made.

The wealthy in our society then become the people with the most power and influence. While ironically, they are the people least deserving of our respect. They are the exact people whom we should look upon with the utmost skepticism and even disdain. They should not be in the position to make decisions about our collective lives and the workings of our society, because their financial success is completely antithetical to societal justice and sustainability.

It doesn’t take great acumen or diligence to make a lot of money; it takes a narrow-minded, insular, immoral, sometimes psychopathic view of life, in which personal pleasure and profit are the primary variables. It’s quite easy to do well financially and find personal satisfaction if the exploitation of humans, other animals, and the entire biosphere is left outside of the realm of your career consciousness. As Ray Anderson, CEO of Interface Carpet admitted,“For 21 yearsI never gave a thought to what we were taking from the earth or doing to the earth in the making of our products.” He built his fortune without consideration to the effects of his enterprise until someone brought the deleterious consequences to his attention.

We like to believe the cream rises to the top, but the truth is that the top is actually full of scum. We have seen in recent weeks, if we did not know already, that entertainment, politics, and indeed, all of the wealthiest industries are cesspools of moral depravity, especially at the apex.

There may be some exceptions, but scum is the rule. Some might call these people ambitious, some might call them razor-focused, others would call them sociopathic. It takes a careful regimen of willful  ignorance and/or denial to not consider all the harms that directly and indirectly result from avenues toward career achievements in the process of our normal lives – harms such as exploitation of labor, torture of animals, and toxic contamination and of food, water, and natural resources.

Material success requires rape and pillage, figuratively and literally. Donald Trump bragged that when you have the kind of wealth he has, you can treat women as objects and just “grab ’em by the pussy.” You can also exploit resources, exploit labor, befoul the environment, and endanger public health with few or no consequences. On a purely moral basis, only scum could have the hubris to consider others as mere playthings for their own enjoyment, to feel superior enough to warrant their extreme wealth which they did not earn but stole from the commons, and to believe that they deserve obscene riches when the majority of others do not even have basic life necessities.

How often have you heard the phrases “not that there is anything wrong with being rich,” or “I don’t begrudge him his wealth”? Wealth should be considered reprehensible. Wealth has always been in the hands of the few to the detriment of the many, and one’s access to it has always been almost wholly correlated with one’s socioeconomic status at birth. Yet we rationalize this immoral situation and pretend that the proverbial “pie,” of which we all need a slice, is infinite in size and that wealth is accessible to anyone. We assume that being rich is not only acceptable but aspirational. It is neither in a just and sustainable world.

On a finite planet every excess dollar, every excess material good, every extra home, car, garment, trinket, piece of food, or beverage that one person possesses essentially correlates to an item that another person does not have. When we normalize one person having more than he/she needs in a world where billions have far less than the bare minimum required to meet their basic needs, then we are obliged to rethink our morality. When a simple handbag can cost between $12K and $300K and we as a society see nothing wrong with that kind of excess in the face of poverty, hunger, homelessness, and disease, we are not only completely socially corrupt, we are spelling our own doom. Poverty only exists because excessive wealth exists and neither is compatible with a sustainable and humane civilization.

To achieve a sustainable world, we must relinquish our use of non-renewable resources, we must utilize renewable resources at a level in which they have the time and ability to replenish, and we must leave no waste that is not regenerative. To achieve an equitable world, we must relinquish our greed and desire for opulence, excess, and disproportionate influence. In fact, sustainability is also a function of equity. However, our current society is predicated on the antithesis of all such requirements.

Wealthy people gain their successes because they have tunnel vision. They are singularly focused on themselves, their careers, and/or on money. They do not take into consideration the externalities involved in their actions. They pay little mind to the exploitation involved in their pursuits. Ethics never supersedes ambition. Therefore, these are the exact people who should not be in charge of making policies for the benefit of society and should not be in charge of civic ventures. To be able to be so wealthy without shame, guilt, or acknowledgement that your own wealth impedes the lives of others is to be either ignorant or indifferent. We are facing global ecological and economic collapse. Who made this happen? The wealthiest people of the world. If you are rich you do not have the solution. You are the problem.

The world is run on slave labor, indentured servitude, animal and natural resource exploitation, and endless generation of waste and contamination. Material success comes with adopting a shortsighted view of the world – closing yourself off to your own connection to global anthropogenic climate change, toxification, and inequality.

So many of the wealthy who consider themselves socially and environmentally aware perceive no connection between their own wealth accumulation and the causes they claim to champion. Instead of curtailing their materialism, they rationalize it. Instead of acknowledging that their consumerism intensifies global resource extraction, they produce more products (often erroneously labeled “green”) to sustain their riches. When the wealthy are not hawking products for their for-profit activities, they have the audacity to solicit for charitable organizations that are only necessitated by the economic system that produces poverty and environmental devastation in the wake of their extravagant wealth. They ask donations from the majority of citizens who are barely making ends meet, when they themselves could surrender probably 90% of their accumulated wealth and not notice a marked change in their material status whatsoever. The elites who are not in denial about the problems we face want scientific and technological solutions – solutions that they can throw their money at and have others solve so they do not have to think about their own contribution to the problems.

But there are no silver bullets to end inequality and environmental destruction, while continuing with business as usual in civilized society. Science cannot save us. Scientific research itself relies on the same unsustainable production, consumption, use of resources, and waste as every other industry.

Technology mavens always tout the great social or biological service that their new technology will provide. Their innovations comes under the guise of helping the world, but the majority of the time, their creations are frivolous and do not do much more than use natural resources, create waste, and earn them exorbitant profit. At the university where I earned my doctoral degree there is a masters program in biotechnology and there’s a reason why their curriculum extends beyond just science, containing at least two required business courses. Of course, business is fundamental to their instruction because the principle purpose of our education, of our careers, is profit.

All of the harmful products and practices in our civilization – military arms, sweatshops, low wages, pesticides, plastics, throw-away items, excess of products, animal cruelty, overuse of medicine and surgery – only exist to increase revenue for the rich. None are fair or just or equitable or sustainable. Our societal justification of the above items just marks our collective delusion. These products and practices persist in the name of profit, and we rationalize their continuation just as we rationalize extravagant wealth.

When Senator Bernie Sanders was on TV decrying President Barack Obama’s half-million dollar speaking engagements on Wall Street, the anchors of the program said to him, “Wouldn’t you do it if you could?” Bernie replied, “I wouldn’t be asked.” Rather, he should have explained that anyone with integrity would not accept money they do not need for some sort of quid pro quo from a destructive and corrupt institution. The hosts of the show surmised that everyone would jump at the opportunity to earn money if they had the chance. It is precisely that sort of mindset that enables these broadcasters to inhabit their influential positions on a national television program and to earn millions of dollars. They demonstrate what unethical opportunists they, and most of the rich, actually are. Their lack of ethics is internalized and taken for granted by not only them, but most of the rest of our society. They are more than willing to be bought at whatever price for whatever service. “Just doing my job” does not serve as an excuse for immorality.

Nevertheless, there are people who have chosen lives based on conviction rather than money. Former Uruguayan President Jose Mujica and Seattle City Council member Kashama Sawant chose to earn the local average income for their official positions and donate the remainder of their salaries toward social justice work. Biologist and writer Sandra Steingraber donated a portion of her $100K Heinz Award prize toward the fight against hydraulic fracturing (fracking) rather than spend it on personal treats. Likewise, teacher Jesse Hagopian donated his $100K settlement for being unjustly attacked with pepper-spray by Seattle police toward social justice action. Not everyone is looking to cash in, and not everyone is seeking the next, biggest profit-making endeavor.

Living with integrity and simplicity is difficult. People do not choose to live this way because their personal sacrifice will change the world. They do so because it is the right thing to do. They do so because having too much means others don’t have enough. They do so because living by example allows others who care to see that a life of wealth and consumerism augments inequality and unsustainability; it is not the only way to live and need not be. They live this way because only by walking the walk rather than talking the talk will we ever start to achieve justice and sustainability to help preserve the future of our species.

In recent years there have been waves and wave of protests throughout the country and the world in response to myriad societal maladies. The best protest we can do in America now is to reject the bourgeois life – reject excessive wealth and the material components that come with it, reject profligate consumption, reject consumerism, reject wasteful holidays, reject wasteful trinkets,  reject all that is incompatible with what we purport to champion. For example, retired talk-show host David Letterman appears sincere in his dedication toward helping combat climate change, while at the same time, he remains co-owner of an auto racing team. In the world in which we currently live, auto racing is completely incongruent with climate change mitigation. We can’t pretend to value matters like justice and sustainability unless the way we live upholds those values. We can’t decouple our livelihoods from our lives.

The rich tend to ensconce themselves in their well-manicured communities, shop with abandon, and disregard the abject poverty, environmental degradation, and injustices all around them. They are in the process of spending small portions of their vast fortunes building survival bunkers to withstand either the revolutionary upheaval that may soon come as a result of immeasurable socioeconomic inequality, or the catastrophic ecological collapse that may result from reckless resource extraction and expenditure. How misguided or cynical are they to not realize that by renouncing their extreme wealth, they would need no such provisions and could play a large part in salvaging our civilization?

Need I even explain how the current tax scam pending on Capitol Hill will serve to enhance all of the socioeconomic, environmental, and public health calamities that are arising ever more rapidly and in quick succession? Need I elaborate on how our escalating climate-related weather catastrophes only reach the cataclysmic proportions they do because of the wealth disparities involved and because of the high-risk industrial components therein, that exist mainly to enrich the elite? Would these natural disasters be so disastrous if more people had the economic resilience that they deserve and if society took more precaution against the hazards of multibillion-dollar industries that manufacture products of questionable value while generating tremendous wealth to a select few?

We live n a time of unprecedented social disarray, ecological disrepair, public health decay, and moral depravity. Nearly every aspect of the way we live in modern industrial societies is completely unsustainable. Even if we were to transition to 100% solar energy tomorrow throughout the planet, the worst effects of climate change might be averted, but the plastic pollution that permeates the most far-reaching depths of the oceans would still remain, the persistent organic pollutants (POPs) and endocrine disrupting compounds (EDCs) that harm our own health and the health of the entire global ecosystem remain. Not only do they remain, but they continue to be produced, not out of necessity, but for the financial profit of the privileged few. The production of, consumption of, and waste stream from our global industrial society continues unabated. This is the system that forms the foundation of all of our lives in the civilized world, and this is the system that bestows excessive wealth to some while leaving others fighting for survival.

While it is indeed the system of capitalism that generates and sustains our societal injustice and ecological degradation, the system is comprised of people – people who could abdicate their fictional obligation to happiness via indefinitely-increasing earnings, people who can choose better, Without a preponderance of such people, no countervailing just and sustainable system can ever compete.

In 1964, Uruguayan journalist Eduardo Galeano interviewed the famous Argentinean hero of the Cuban revolution Ernesto “Che” Guevara. In the midst of a comprehensive conversation, Che stated to Galeano, ” I don’t want every Cuban to wish he were a Rockefeller.” To be sure, if we are remotely interested in a sustainable and equitable world, the attainment of wealth must be transformed from admirable to contemptible. With regard to the multitude of obstacles we face, Ralph Nader once wrote “only the super-rich can save us.” He’s right. They can save us by not existing.

Human Anxiety in Late-Stage Capitalism

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By Phil Rockstroh

Source: Consortium News

A number of recent press articles, including an over 8,000-word feature piece in The New York Times have asked, to quote the Times’ headline, “Why Are More American Teenagers Than Ever Suffering From Severe Anxiety?”

Although the question was proffered, the reporters and editors responsible for the articles remain resolutely obtuse to the obvious: The bughouse crazy environment of late-stage capitalist culture evokes classic fight-or-flight responses attendant to episodes of severe anxiety and panic attacks.

The word panic has its derivation in reference to Pan, the Greek god of wilderness and wildness, of the animal body encoded within human beings and its attendant animalistic imperatives. To wit, deracinate an animal from its natural habitat and it will evince, on an instinctual basis, a fight-or-flight response.

If caged, the unfortunate creature will pace the confines of its imprisonment, chew and tear at its fur and flesh, become irritable, enervated, languish and even die from the deprivation of the environment it was born to inhabit. A caged animal, even if the unfortunate creature endures captivity, is not the entity nature conceived; the living being has been reduced to A Thing That Waits For Lunch.

Human beings, animals that we are, respond in a similar fashion. Experiencing anxiety is among the ways our innate animal spirits react to the capitalist cage. Inundate a teenager with the soul-defying criteria of the corporate/consumer state, with its overbearing, pre-careerist pressures, its paucity of communal eros, its demands, overt and implicit, to conform to a shallow, manic, nebulously defined yet oppressive societal order, and insist that those who cannot adapt, much less excel, are “losers” who are fated to become “basement dwellers” in their parents’ homes or, for those who lack the privilege, be cast into homelessness, then the minds of the young or old alike are apt to be inundated with feelings of angst and dread.

Worse, if teenagers are culturally conditioned to believe said feelings and responses are exclusively experienced by weaklings, parasites, and losers then their suffering might fester to the point of emotional paralysis and suicidal inclinations.

No Real Remedies

What does the capitalist state offer as remedy? Obscenely profitable, corporately manufactured and widely prescribed psychoactive medications. Treatment, which, at best, merely masks symptoms and bestows the illusion of recovery.

As R. D. Laing observed: “What we call ‘normal’ is a product of repression, denial, splitting, projection, introjection and other forms of destructive action on experience. It is radically estranged from the structure of being.”

In short, it is insanity to be expected to adapt to socially acceptable insanity. Yet we are pressured to adapt to, thus internalize odious, groupthink concepts and tenets. To cite one such groupthink example: homelessness is natural to the human condition and is a communally acceptable situation.

Closer to fact: The problem of homelessness is the result of a societal-wide perception problem — the phenomenon is the very emblem of the scrambling, twisting, dissociating, and displacing of perception that capitalist propagandists specialize in. Homelessness would be considered a relic of a barbaric past if this very simple principle was applied: Having access to permanent shelter is a human right and not a privilege.

What kind of a vile, vicious people would deny that simple proposition? Those conditioned by a lingering Puritan/Calvinist mindset to believe: Punishment for resisting the usurpation of the fleeting hours of one’s finite life must be severe. If the over-class can no longer get away with, as was once common practice in the Puritan/Calvinist tradition, public floggings to whip the labor force into line, then those who will not or cannot comply will be cast onto the cold, unforgiving concrete of a soulless cityscape.

It comes down to this, societies that are ridden with vast wealth inequity, due to the machinations of a rapacious over-class, create the obscenity known as homelessness. Moreover, the situation is only one of the numerous obscenities inherent to state capitalism. Obscenities that include, events that are dominating the present news cycle, e.g., the predations of a lecherous movie mogul, to the sub-cretinous doings and pronouncements of a Chief of State who is a bloated, bloviating, two-legged toxic waste dump.

Trump, No Aberration 

How is it then, liberals fail to grasp the fact that the Trump presidency is not an aberration; rather, his ascension to power should be regarded as being among the high probability variables of late-stage capitalism and empire building? The psychopathic, tangerine-tinged clown Trump is the embodiment of the Second Law of Thermodynamics, a development that is concomitant to over-expanded empires. Thus he will continue to flounce deeper into the quagmire of crash-engendering, economic legerdemain and perpetual war.

Empires are death cults, and death cults, on a subliminal basis, long for their own demise. Paradoxically, the collective mindset of imperium, even as it thrusts across the expanse of the world, renders itself insular, cut off from culturally enhancing novelty, as all the while, the homeland descends into a psychical swamp of churning madness.

A draining of the swamp of the collective mind cannot come to pass, for the swamp and citizenry are one. Withal, the likes of leaders such as Trump rise from and are made manifest by the morass of the culture itself. In a swamp, the gospel of rebirth and redemption is heard in the song of humus. New life rises from its compost.

In the presence of Trump’s debased mind and tombified carcass, one is privy to arias of rot. While Hillary Clinton’s monotonous tempo was the dirge of a taxidermist — cold, desiccated of heart, and devoid of life’s numinous spark — Trump’s voice carries the depraved cacophony of a Célinean fool’s parade … its trajectory trudging towards the end of empire.

As liberals new BFFL (Best Friend for Life) George W. Bush might ask, “Is our liberals learning.”

In a word, no. For example, the collective psyche of U.S. culture as been enflamed by the revelations that actresses were coerced into sexual encounters with a movie mogul whose power in the industry was only matched, even enhanced, by his sadistic nature. The staff of his company assisted, was complicit in, or remained silent about his lechery, as did the whole of the movie industry and the entertainment press. All as NFL athletes are being threatened with expulsion from the League if they kneel during the national anthem.

The Great Unspoken 

Yet the great unspoken remains: The enabling of and submission to the degradation, exploitation and tyranny, and the lack of resistance thereof share a common and singular factor: The careerism of all concerned. The cultural milieu concomitant to capitalism is at the rotten root and noxious blossoming of the situation.

Jean-Luc Godard’s 1967 cinematic barnburner “Two or Three Things I Know About Her” should be required viewing for those unaware or in denial of the acuity of the film’s theme i.e., becoming enmeshed within the psychical landscape of dominance, degradation, and submission inherent to and inseparable from capitalist/consumer culture will cause one to become party to societal sanctioned prostitution. When life is negotiated within a collective value system that devalues and deadens the individual’s inner life thus warps every human transaction, anomie descends, the worst among a people ascend to positions of power.

“Panic is the sudden realization that everything around you is alive.” — William S. Burroughs, from Ghost of Chance

When friends visited me in New York, where I lived for decades, I would take them on walking tours through the city. We would cross the Westside Highway and stroll the pedestrian walk along the Hudson River, or cross the East River by walking across the Brooklyn Bridge.

The effect of these excursions on people was often profound … the combined elements of the elemental beauty of the rivers and vastness of the city’s architecture and scope, clamor, and the dense interweaving of traditional ethnic customs and ad hoc social codes of New Yorkers often would heighten the visitors’ senses and open them to larger, more intricate awareness of themselves and extant reality … the freeways of the contemporary mind (conditioned to be constantly engaged in manic motion, with one’s mind either frenzied by an obsession with performing (ultimately futile) maneuvers directed to saving time — or stalled at a frustration inducing standstill) were replaced by the exigencies of life at street level, i.e., novel situations that had to be apprehended and negotiated.

The possibilities of life seemed greater. The crimped eros of insular suburban thought became loosened before the city’s intricacies and expansiveness. Although: Not all, or even a scant few, New Yorkers can maintain the state of being. Few of us can live by Rilke’s resolve to “make every moment holy.” Life, in the city, becomes grotesquely distorted … High rents, inflicted by hyper-gentrification, in combination with the deification of success and its cult of careerism overwhelm one’s psyche … There is so far to fall.

Angst (the word originally can be traced to the ancient Greek deity Ananke, the immovable by prayer and offering bitch Goddess of Necessity and the root word of anxiety) clamps down one’s sense of awareness. Ananke dominates the lives of the non-privileged citizenry while Narcissus, Trump’s, the Clintons’, et.al. and their financial and cultural elitists’ patron God rules the day. The pantheon of possibility has been decimated, a cultural cleansing has been perpetrated, by the egoist caprice of the beneficiaries of the late capitalist dictatorship of money.

Hence, we arrive at the primal wisdom tacitly conveyed by anxiety-borne states of fight or flight. Due to the reality that capitalism, on both an individual and collective basis, drives individuals into madness, all as the system destroys forest and field, ocean and sea and the soul-scape of all who live under its rapacious dominion, our plight comes down to this: We either struggle and strive, by and any and all means, to end the system — or it will end us.

Why We’re Doomed: Our Economy’s Toxic Inequality

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By Charles Hugh Smith

Source: Of Two Minds

Anyone who thinks our toxic financial system is stable is delusional.

Why are we doomed? Those consuming over-amped “news” feeds may be tempted to answer the culture wars, nuclear war with North Korea or the Trump Presidency.

The one guaranteed source of doom is our broken financial system, which is visible in this chart of income inequality from the New York Times: Our Broken Economy, in One Simple Chart.

While the essay’s title is our broken economy, the source of this toxic concentration of income, wealth and power in the top 1/10th of 1% is more specifically our broken financial system.

What few observers understand is rapidly accelerating inequality is the only possible output of a fully financialized economy. Various do-gooders on the left and right propose schemes to cap this extraordinary rise in the concentration of income, wealth and power, for example, increasing taxes on the super-rich and lowering taxes on the working poor and middle class, but these are band-aids applied to a metastasizing tumor: financialization, which commoditizes labor, goods, services and financial instruments and funnels the income and wealth to the very apex of the wealth-power pyramid.

Take a moment to ponder what this chart is telling us about our financial system and economy. 35+ years ago, lower income households enjoyed the highest rates of income growth; the higher the income, the lower the rate of income growth.

This trend hasn’t just reversed; virtually all the income gains are now concentrated in the top 1/100th of 1%, which has pulled away from the top 1%, the top 5% and the top 10%, as well as from the bottom 90%.

The fundamental driver of this profoundly destabilizing dynamic is the disconnect of finance from the real-world economy.

The roots of this disconnect are debt: when we borrow from future earnings and energy production to fund consumption today, we are using finance to ramp up our consumption of real-world goods and services.

In small doses, this use of finance to increase consumption of real-world goods and services is beneficial: economies with access to credit can rapidly boost expansion in ways that economies with little credit cannot.

But the process of financialization is not benign. Financialization turns everything into a commodity that can be traded and leveraged as a financial entity that is no longer firmly connected to the real world.

The process of financialization requires expertise in the financial game, and it places a premium on immense flows of capital and opaque processes: for example, the bundling of debt such as mortgages or student loans into instruments that can be sold and traded.

These instruments can then become the foundation of an entirely new layer of instruments that can be sold and traded. This pyramiding of debt-based “assets” spreads risk throughout the economy while aggregating the gains into the hands of the very few with access to the capital and expertise needed to pass the risk and assets off onto others while keeping the gains.

Profit flows to what’s scarce, and in a financialized economy, goods and services have become commodities, i.e. they are rarely scarce, because somewhere in the global economy new supplies can be brought online.

What’s scarce in a financialized economy is specialized knowledge of financial games such as tax avoidance, arbitrage, packaging collateralized debt obligations and so on.

Though the billionaires who have actually launched real-world businesses get the media attention–Bill Gates, Jeff Bezos, Steve Jobs, et al.–relatively few of the top 1/10th of 1% actually created a real-world business; most are owners of capital with annual incomes of $10 million to $100 million that are finance-generated.

This is only possible in a financialized economy in which finance has become increasingly detached from the real-world economy.

Those with the capital and skills to reap billions in profits from servicing and packaging student loan debt have no interest in whether the education being purchased with the loans has any utility to the indebted students, as their profits flow not from the real world but from the debt itself.

This is how we’ve ended up with an economy characterized by profound dysfunction in the real world of higher education, healthcare, etc., and immense fortunes being earned by a few at the top of the pyramid from the financialized games that have little to no connection to the real-world economy.

Anyone who thinks our toxic financial system is stable is delusional. If history is any guide (and recall that Human Nature hasn’t changed in the 5,000 uears of recorded history), this sort of accelerating income/wealth/ power inequality is profoundly destabilizing–economically, politically and socially.

All the domestic headline crises–culture wars, opioid epidemic, etc.–are not causes of discord: they are symptoms of the inevitable consequences of a toxic financial system that has broken our economy, our system of governance and our society.

It’s time to call the housing crisis what it really is: the largest transfer of wealth in living memory

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By Laurie Macfarlane

Source: OpenDemocracy.net

One of the basic claims of capitalism is that people are rewarded in line with their effort and productivity. Another is that the economy is not a zero sum game. The beauty of a capitalist economy, we are told, is that people who work hard can get rich without making others poorer.

But how does this stack up in modern Britain, the birthplace of capitalism and many of its early theorists? Last week, the Office for National Statistics (ONS) released new data tracking how wealth has evolved over time. On paper, the UK has indeed become much wealthier in recent decades. Net wealth has more than tripled since 1995, increasing by over £7 trillion. This is equivalent to an average increase of nearly £100,000 per person. Impressive stuff. But where has all this wealth come from, and who has it benefitted?

Just over £5 trillion, or three quarters of the total increase, is accounted for by increase in the value of dwellings – another name for the UK housing stock. The Office for National Statistics explains that this is “largely due to increases in house prices rather than a change in the volume of dwellings.” This alone is not particularly surprising. We are forever told about the importance of ‘getting a foot on the property ladder’. The housing market has long been viewed as a perennial source of wealth.

But the price of a property is made up of two distinct components: the price of the building itself, and the price of the land that the structure is built upon. This year the ONS has separated out these two components for the first time, and the results are quite astounding.

In just two decades the market value of land has quadrupled, increasing recorded wealth by over £4 trillion. The driving force behind rising house prices — and the UK’s growing wealth — has been rapidly escalating land prices.

For those who own property, this has provided enormous benefits. According to the Resolution Foundation, homeowners born in the 1940s and 1950s gained an unearned windfall of £80,000 between 1993 and 2014 alone. In the early 2000s, house price growth was so great that 17% of working-age adults earned more from their house than from their job.

Last week The Times reported that during the past three months alone, baby boomers converted £850 million of housing wealth into cash using equity release products – the highest number since records began. A third used the money to buy cars, while more than a quarter used it to fund holidays. Others are choosing to buy more property: the Chartered Institute of Housing has described how the buy-to-let market is being fuelled by older households using their housing wealth to buy more property, renting it out to those who are unable to get a foot on the property ladder. And it is here that we find the dark side of the housing boom.

As house prices have continued to increase and the gap between house prices and earnings has grown larger, the cost of homeownership has become increasingly prohibitive. Whereas in the mid-1990s low and middle income households could afford a first time buyer deposit after saving for around 3 years, today it takes the same households 20 years to save for a deposit. Many have increasingly found themselves with little choice but to rent privately. For those stuck in the private rental market, the proportion of income spent on housing costs has risen from around 10% in 1980 to 36% today. Unlike homeowners, there is no asset wealth to draw on to fund new cars or holidays.

In Britain, we have yet to confront the truth about the trillions of pounds of wealth amassed through the housing market in recent decades: this wealth has come straight out of the pockets of those who don’t own property.

When the value of a house goes up, the total productive capacity of the economy is unchanged because nothing new has been produced: it merely constitutes an increase in the value of the land underneath. We have known since the days of Adam Smith and David Ricardo that land is not a source of wealth but of economic rent — a means of extracting wealth from others. Or as Joseph Stiglitz puts it “getting a larger share of the pie rather than increasing the size of the pie”. The truth is that much of the wealth accumulated in recent decades has been gained at the expense of those who will see more of their incomes eaten up by higher rents and larger mortgage payments. This wealth hasn’t been ‘created’ – it has been stolen from future generations.

House prices are now on average nearly eight times that of incomes, more than double the figure of 20 years ago. It’s unlikely that house prices will be able to outpace incomes at the same rate for the next 20 years. The past few decades have spawned a one-off transfer of wealth that is unlikely to be repeated. While the main beneficiaries of this have been the older generations, eventually this will be passed on to the next generation via inheritance or transfer. Already the ‘Bank of Mum and Dad’ has become the ninth biggest mortgage lender. The ultimate result is not just a growing intergenerational divide, but an entrenched class divide between those who own property (or have a claim to it), and those who do not.

Misleading accounting and irresponsible economics have provided cover for this heist. The government’s national accounts record house price growth as new wealth, ignoring the cost it imposes on others in society – particularly young people and those yet to be born. Economists still hail house price inflation as a sign of economic strength.

The result is a world which is rather different to that described in economics textbooks. Most of today’s ‘wealth’ isn’t the result of entrepreneurialism and hard work – it has been accumulated by being idle and unproductive. Far from the positive sum game capitalism is supposed to be, we have a system where most wealth is gained at the expense of others. As John Stuart Mill wrote back in 1848:

“If some of us grow rich in our sleep, where do we think this wealth is coming from?  It doesn’t materialise out of thin air. It doesn’t come without costing someone, another human being. It comes from the fruits of others’ labours, which they don’t receive.”

Britain’s housing crisis is complicated mess. Fixing it requires a long-term plan and a bold new approach to policy. But in the meantime let’s start calling it what it really is: the largest transfer of wealth in living memory.

The social and economic roots of the attack on democratic rights

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Inequality and the American oligarchy

By Eric London

Source: WSWS.org

A report published September 27 by the US Federal Reserve, the Survey of Consumer Finances, shows that the top 10 percent of Americans now own 77 percent of all wealth. The top 1 percent increased its share of wealth from 35.5 percent in 2013 to 38.5 in 2016. The share of the bottom 90 percent declined from 25 percent to 22.9 percent over the same period.

These percentages show a transfer of trillions of dollars from the working class to the rich and affluent in just three years.

The bottom three quarters of the population, some 240 million people, now own less than 10 percent of the wealth. That is, if the United States were a 10-storey apartment building with 100 people, the richest person would be living on the top four floors, the nine next wealthiest people on the next four floors, fifteen on the second floor, and 75 people cramped at the bottom level.

Wealth share by wealth decile, Credit: People’s Policy Project

The Federal Reserve data demonstrates, in empirical terms, profound changes in social relations that affect hundreds of millions of people, touching all aspects of political, cultural and intellectual life. The US is an oligarchy in which the government, trade unions, media, universities, and major political parties are instruments used by the ruling class to manipulate the population, mask its own wealth, and crush social opposition from below.

The figures expose the material basis for the emergence of a campaign in the ruling class to block access to the World Socialist Web Site and other left-wing sites in the guise of combatting “Russian aggression.”

In an oligarchy, social inequality is incompatible with democratic rights. Incapable of and unwilling to address the social needs of the masses of people, the government turns to censorship, surveillance, blacklisting, and violence as its preferred methods for defending unprecedented levels of wealth monopolized by the ruling class.

The data shows that the main dividing line is between the top 10 percent and the bottom 90 percent that comprise the working class. The Federal Reserve figures expose as lies the claims by politicians and media pundits that the bulk of the US population belongs to the “middle class.”

Below the aristocracy and the affluent—concentrated in certain neighborhoods of major centers like New York, the San Francisco Bay Area, Los Angeles, Chicago, Houston, and other cities—the United States is a country dominated by tremendous economic hardship. The data shows that while different strata of the population face economic insecurity at different levels of urgency, decades of social counterrevolutionary policies by both parties are bringing them closer together, marking all with the same scars of class exploitation.

The poorest ten percent of the population, some 32 million people, possess negative wealth. They include the homeless and the hopelessly in debt. For this section of the population, roughly equal to the populations of Texas and New York combined, life expectancy, disease rates, and living standards resemble third world conditions.

The next poorest ten percent have no wealth, between $0 and $5,000 per family, less than the value of a 10-year-old used car. The combined wealth possessed by this layer is not significant as a proportion of overall wealth.

Roughly the lower-middle third of the population, from the 20th to 50th percentile, control just 1.6 percent of total wealth. A family of four with two parents working full-time at the minimum wage with one average-priced vehicle and no other assets would fall in the middle of this broad category of workers.

The 64 million people in the 50 to 70 percent range control just 5.1 percent of the wealth. A family with a below average-priced home worth $150,000, plus a vehicle and $0 in savings would be above the 60th percentile in wealth. A family with two working adults making between $40,000 and $50,000 each would find itself in the 70 to 80 percentile, perhaps possessing two cars, a home valued just above the national average of $175,000, a life insurance policy and $10,000 in savings.

The 80 to 90th percentile owns 11.2 percent of the wealth. Two skilled workers with incomes of $60,000 to $80,000 each, one pension, a $300,000 home, and two vehicles would find themselves in this decile. This section is slightly more comfortable, but by no means financially secure.

The chasm separating the top 10 percent from the working class has widened in recent years. From 2004 to 2016, the working class saw its wealth decline precipitously across all strata. The median family in the poorest fifth lost 29.5 percent of its wealth over this period, followed by 24.7 percent for the median family in the 20th-39th percentile, 10.8 percent in the 40th-59th percentile, 17.3 percent in the 60th-79th percentile, and 1.3 percent in the 80th-89th percentile. This wealth went to the top 10 percent, where median family wealth rose by 38.7 percent over the same period.

As a result of this massive transfer of wealth, median family wealth in the top 10 percent is nearly triple that of the 80 to 90 percent, 20 times greater than a family in the 50th percentile, and 254 times more than the median family net worth in the poorest 20 percent.

The political establishment that has overseen this transfer systematically ignores and aggravates the urgent social problems confronting the vast majority of the population.

Footage of Trump flipping paper towel rolls to victims of the storm in Puerto Rico epitomizes the callous and insulting response of the oligarchy to the problems of the working class. But sanctimonious claims by Democrats that Trump’s actions were “insensitive” ignore the fact that the entire ruling class is responsible for the social catastrophe. After all, it was Barack Obama who travelled to Flint, Michigan and told a crowd of people to “drink the water.” Nobody in the Democratic or Republican parties has made any real effort to address the opioid crisis, homelessness, declining life expectancy, storm protection and disaster infrastructure, skyrocketing student debt and the health care crisis.

The three branches of government, largely comprised of millionaires and billionaires, focus exclusively on the interests and social demands of the top 1, and, more broadly, the top 10 percent of society. A key concern of the affluent 10 percent is blocking the growth of social opposition and protecting their own wealth and privileges. In recent years, the American ruling class has become more aware of the growth of social opposition within the population to war, inequality and poverty.

Fearful that the technological advances of the Internet and social media platforms can increase access to alternative political viewpoints, the oligarchy has initiated a campaign to censor left-wing websites and crack down on social media platforms in the name of blocking “Russian interference” in the US political system. Without a shred of credible evidence to back their claims, newspaper editors, TV talking heads, Senate and House committee members, corporate executives, trade union leaders and academics are engaged in a mad rush to censor the Internet and protect the population from “fake news.”

The anti-fake news censorship and blacklisting initiative is an escalation of a years-long campaign by the ruling class to create the framework for police state methods of rule. At the same time, the growth of social inequality revealed in the Federal Reserve figures points to the inexorable intensification of social and class conflict in the United States, the objective foundation for socialist revolution.

And empires die

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Source: Intrepid Report

Nothing ever seems to last, everybody changes oh so fast,
promises made promises lost and pride is kept at any cost,
And flowers die, and children cry, and lonely people carry on.
—Palermo & Farruggio 1970

That was from the song And Flowers Die, by prolific composer Michael Palermo and this writer as lyricist. How appropriate to compare this song with the ‘death song’ of our Military-Industrial Amerikan Empire, now in only its 72nd year of prominence. How great and powerful our empire was for so long. We controlled the economies and governments of so many countries, even continents. Now it is the autumn of our status as Number One. The Asian rim, as many refer to it, being led by China and all those other nations in that region, will become the future economic powerhouse of this planet.

This writer will leave it to the many progressive scholars out there for the explanation of the how and why of this equation. Let me just say that we all, from grade school on, have been fed the pabulum of America as a democracy, benevolent to the entire world. Many sadly still believe that lie, and that strengthens the reason why this empire is in freefall.

Since we became the preeminent world empire at the end of WW2, two things held the greedy ones who run things in we’ll say half check: The progressive federal tax rate and the union movement. The top tax rate from 1953 to 1963 was 91%. Now, we know that the super rich did not pay at that rate, but even after their accountants sharpened a few pencils, many still had to pay at least 50%, for argument sake. Today’s top rate is 39.6%, meaning that folks like mega millionaire Mitt Romney pay at around 15%-20%. Do the math and see how much more went into the treasury then as opposed to now. The second factor that held this empire in half check was the stronger union movement in the ‘50s, ‘60s and ‘70s. In the 1950s, about 35% of American workers belonged to unions. In 1983, it went down to around 20%. Now, the percentage is around 12%. So, that means that three times more working stiffs in the recent past had the protection of a union, however weak or compliant that union may have been. Today, this empire can breathe easily as fewer and fewer working stiffs even have a union!

To this writer, with all the many factors that have contributed to the demise of our nation via this Military-Industrial Empire, the number one factor is our foreign policy. When over half of your spending goes for military reasons, how can a nation sustain itself at home? When you have over 1,000 military bases in over 100 countries, and you consistently are involved in these phony wars, the home front must feel the strain. Our myriad of domestic bleeding is so obvious . . . yet so few here will acknowledge it. Our infrastructure is crumbling, our health care is a mess, too many mediocre paying jobs (with too many being part time with NO benefits), our political system is controlled by Big Money, our media is controlled by the same Big Money . . . and the fools still fight amongst each other over the Two Party/One Party con job.

Let’s face it: All the major industrialized nations are controlled by their super rich. There are really few exceptions. Sadly, with over 99+ % of the populace in all these countries being just simple working stiffs, it is time for a change of mindset. The mindset must be simple: The super rich need to go back to paying their fair share, and government needs to become what Mark Twain prescribed: ‘To protect us from the crooks and scoundrels.’

The Value of Everything

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By James Howard Kunstler

Source: Kunstler.com

We are looking more and more like France on the eve of its revolution in 1789. Our classes are distributed differently, but the inequity is just as sharp. America’s “aristocracy,” once based strictly on bank accounts, acts increasingly hereditary as the vapid offspring and relations of “stars” (in politics, showbiz, business, and the arts) assert their prerogatives to fame, power, and riches — think the voters didn’t grok the sinister import of Hillary’s “it’s my turn” message?

What’s especially striking in similarity to the court of the Bourbons is the utter cluelessness of America’s entitled power elite to the agony of the moiling masses below them and mainly away from the coastal cities. Just about everything meaningful has been taken away from them, even though many of the material trappings of existence remain: a roof, stuff that resembles food, cars, and screens of various sizes.

But the places they are supposed to call home are either wrecked — the original small towns and cities of America — or replaced by new “developments” so devoid of artistry, history, thought, care, and charm that they don’t add up to communities, and are so obviously unworthy of affection, that the very idea of “home” becomes a cruel joke.

These places were bad enough in the 1960s and 70s, when the people who lived in them at least were able to report to paying jobs assembling products and managing their distribution. Now those people don’t have that to give a little meaning to their existence, or cover the costs of it. Public space was never designed into the automobile suburbs, and the sad remnants of it were replaced by ersatz substitutes, like the now-dying malls. Everything else of a public and human associational nature has been shoved into some kind of computerized box with a screen on it.

The floundering non-elite masses have not learned the harsh lesson of our time that the virtual is not an adequate substitute for the authentic, while the elites who create all this vicious crap spend millions to consort face-to-face in the Hamptons and Martha’s Vineyard telling each other how wonderful they are for providing all the artificial social programming and glitzy hardware for their paying customers.

The effect of this dynamic relationship so far has been powerfully soporific. You can deprive people of a true home for a while, and give them virtual friends on TV to project their emotions onto, and arrange to give them cars via some financing scam or other to keep them moving mindlessly around an utterly desecrated landscape under the false impression that they’re going somewhere — but we’re now at the point where ordinary people can’t even carry the costs of keeping themselves hostage to these degrading conditions.

The next big entertainment for them will be the financial implosion of the elites themselves as the governing forces of physics finally overcome all the ruses and stratagems of the elites who have been playing games with money. Professional observers never tires of saying that the government can’t run out of money (because they can always print more of it) but they can certainly destroy the value of that money and shred the consensual confidence that allows it to operate as money.

That’s exactly what is about to commence at the end of the summer when the government runs out of cash-on-hand and congress finds itself utterly paralyzed by party animus to patch the debt ceiling problem that disables new borrowing. The elites may be home from the Hamptons and the Vineyard by then, but summers may never be the same for them again.

The Deep State may win its war against the pathetic President Trump, but it won’t win any war against the imperatives of the universe and the way that expresses itself in the true valuation of things. And when the moment of clarification arrives — the instant of cosmic price discovery — the clueless elites will have to really and truly worry about the value of their heads.

 

America’s Rich Are Completely Losing Touch With Reality — and That’s a Really Bad Sign

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By Shaun Bradley

Source: AntiMedia

The divide between wealthy and working class has grown wider each year since the last financial crisis, but this disconnect is about much more than just money or politics. The super-rich, in particular, have become completely detached from the everyday problems facing millions of their fellow citizens. Instead of recognizing the urgency of the current situation and contributing to solutions that help empower all members of society, the focus for many has shifted toward simply indulging in the present moment and increasing luxury. This kind of self-centered worldview has emerged throughout history and typically thrives most when decadent empires start to crumble.

Right now, the average person is forced to worry about central banks devaluing their currencies, corrupt bureaucrats eroding their civil liberties, and an economy on life support. Meanwhile, a faction of affluent individuals has committed themselves to avoiding the turmoil around them, instead choosing to obsess over life extension, genetic manipulation, and creating luxurious doomsday plans. Those people who have the crucial intellect, resources, and influence needed to implement real change are consumed with self-interest to the point of total apathy towards the future.

One of the more disturbing trends has been a rise in interest regarding something called parabiosis. This practice involves blood transfusions between the young and old in an attempt to slow the aging process. The procedure has been studied in the past but has always been met with moral and scientific criticism. Recently, however, a California start-up called Ambrosia began offering clients the opportunity to purchase the blood of someone under the age of 25 for a mere $8,000.

The process gained attention after Paypal co-founder Peter Thiel came out in support of further research during an interview:

“I’m looking into parabiosis stuff, which I think is really interesting. This is where they did the young blood into older mice and they found that had a massive rejuvenating effect. And so that’s … that is one that … again, it’s one of these very odd things where people had done these studies in the 1950s and then it got dropped altogether. I think there are a lot of these things that have been strangely underexplored.”

The blood used for these transfusions is often purchased from blood banks without informing the original donors. Popular high-school blood drives could soon have a whole new incentive to encourage students to participate. Any possible medical advancements that can help improve the lives of sick people should be explored, but for a private business to benefit directly from the generosity of others without their consent is a bit unnerving.

The question of whether this treatment is effective or not is almost a secondary issue to the ethical one. What does it show about our society when the priority of so many is not building a better world for the next generation but, rather, appeasing their egos by desperately clinging to their youth? The similarity to vampirism can’t be overlooked and may be another sign that, in the end, the truth is stranger than fiction.

The super-wealthy who can see the dangers facing the world are also fine with hitting the eject button to their own private bunkers in a worst-case scenario. The prepping community that was once isolated to ‘conspiracy theorists’ and survivalist groups has now been adopted by the 1%. Several billionaires have even gone so far as to buy entire islands to guarantee they won’t be swept up in the panic of the masses.

Tim Chang, the managing director at a financial firm called the Mayfield Fund, spoke to a reporter at the New Yorker about some of the conversations going on in these circles:

“There’s a bunch of us in the Valley. We meet up and have these financial-hacking dinners and talk about backup plans people are doing. It runs the gamut from a lot of people stocking up on Bitcoin and cryptocurrency, to figuring out how to get second passports if they need it, to having vacation homes in other countries that could be escape havens…I’ll be candid: I’m stockpiling now on real estate to generate passive income but also to have havens to go to….I kind of have this terror scenario: ‘Oh, my God, if there is a civil war or a giant earthquake that cleaves off part of California, we want to be ready.’ ”

While the ideas of democratic socialism have spread throughout the country, it’s clear that extreme individualism has developed on the other side. The majority of those with the means to care for themselves and their families have abandoned any connection to the rest of society. As long as the impact of the coming upheaval doesn’t affect them directly, it appears the fate of the rest is irrelevant.

The mentality of the nation has transitioned from proactive to reactive, with a sense of inevitability about the ultimate outcome we’re all facing. There is almost no effort to openly discuss the growing prospect of a civil war or severe economic breakdown, even as it grows more plausible in the minds of those paying attention. This obsession on the part of the super-rich for god-like control over their destinies only shows the fear that overwhelmingly dictates their choices. Maybe the modern day peasants of society should simply heed the advice of Marie Antoinette and eat cake while the world burns.