How to Stop the GOP Effort to Recreate the Gilded Age

The Republican answer to everything in terms of the economy is to cut taxes, for the rich, smash labor unions, reduce safety regulations, and allow vulture capitalism an unfettered free hand.  The results of this approach is that over the last 35 years, the wealth of the top 1% in America has collectively increased by $1 trillion.  Meanwhile, the wealth of the bottom 80% of society has shrunk by $1 trillion.  While giving lip service to concern about rising inequality in America, the Republicans basically have no solutions and are only too willing to allow things to continue while using racism, appeals to far right religion, and fear of foreigners to dupe Americans into voting for politicians who will continue the war on the middle and lower classes.  A column in the New York Times looks at some of what really needs to be done if the problem is to be addressed.  Here are highlights:

Summers’s analysis of current economic conditions suggests that free market capitalism, as now structured, is producing major distortions. These distortions, in his view, have resulted in gains of $1 trillion annually to those at the top of the pyramid, and losses of $1 trillion every year to those in the bottom 80 percent.

At a Feb. 19 panel discussion on the future of work organized by the Hamilton Project, a centrist Democratic think tank, Summers defied economic orthodoxy. He dismissed as “whistling past the graveyard” the widely accepted view that improving education and job training is the most effective way to reduce joblessness.  “The core problem,” according to Summers, is that

there aren’t enough jobs, and if you help some people, you can help them get the jobs, but then someone else won’t get the jobs. And unless you’re doing things that are affecting the demand for jobs, you’re helping people win a race to get a finite number of jobs, and there are only so many of them.

He adds that he is “all for” more schooling and job training, but as an answer to the problems of the job marketplace, “it is fundamentally an evasion.”

Summers dismissed as palliative such relatively modest proposals as supplementing the earnings of low-wage workers by increasing the earned-income tax credit and expanding eligibility for the refundable credit.

Even a 50 percent increase in the earned-income tax credit at a cost of $25 billion would barely address current income inequality, Summers said.
[A]ny attempt to correct the contemporary pattern in income distribution would require large and controversial changes in tax policy, regulation of the workplace, and intervention in the economy to expand employment and to raise wages.

To counter the weak employment market, Summers called for major growth in government expenditures to fill needs that the private sector is not addressing:

In our society, whether it is taking care of the young or taking care of the old, or repairing a lot that needs to be repaired, there is a huge amount of very valuable work that needs to be done. It’s much less clear, to use a modern phrase, that there’s a viable business model for getting it done. And I guess the reason why I think there is going to need to be a lot of reflection on the role of government going forward is that, if I’m right, that there’s vitally important work to be done for which there is no standard capital business model that will get it done. That suggests important roles for public policy.

In order to stem the disproportionate share of income flowing to corporate managers and owners of capital, and to address the declining share going to workers, the report calls for tax and regulatory policies to encourage employee ownership, the strengthening of collective bargaining rights, regulations requiring corporations to provide fringe benefits to employees working for subcontractors, a substantial increase in the minimum wage, sharper overtime pay enforcement, and a huge increase in infrastructure appropriations – for roads, bridges, ports, schools – to spur job creation and tighten the labor market.

Summers has advised Hillary Clinton on economic issues, and a key question looking toward 2016 is how much of the Summers agenda she is prepared to adopt, if she decides to run for president.

Many of the policies outlined by Summers — especially on trade, taxation, financial regulation and worker empowerment — are the very policies that divide the Wall-Street-corporate wing from the working-to-middle-class wing of the Democratic Party. Put another way, these policies divide the money wing from the voting wing.

Summers has forced out in the open a set of choices that Hillary Clinton has so far avoided, choices that even if she attempts to elide them will amount to a signal of where her loyalties lie.

Yes, Hillary will need to show her hand.  But meanwhile, it is noteworthy that EVERYTHING that is proposed as part of the solution is opposed by the GOP. Meanwhile, there is more upward social mobility in "Old Europe" than here in America.

The New Gilded Age: Middle Class Shrinks Further

The GOP policies of aiding the wealthy, blocking funding for infrastructure repairs, and the destruction of labor unions continue to bear fruit and the American middle class continues to shrink.  It's all in keeping with the GOP's apparent desire to bring back the worse aspects of the Gilded Age when the wealthy lived like aristocrats and the rest of us were the peasants and serfs.  The shortsightedness, of course, is that as the middle class shrinks, the purchasing power that drives the overall economy shrinks.  Not that Republicans seem to care given all of the political bribes contributions they receive from wealthy and vulture capitalists.  The New York Times looks at the alarming trend.  Here are highlights:

The middle class that President Obama identified in his State of the Union speech last week as the foundation of the American economy has been shrinking for almost half a century.

Few people noticed or cared as the size of that group began to fall, because the shift was primarily caused by more Americans climbing the economic ladder into upper-income brackets.

But since 2000, the middle-class share of households has continued to narrow, the main reason being that more people have fallen to the bottom.

The definition here starts at $35,000 — which is about 50 percent higher than the official poverty level for a family of four — and ends at the six-figure mark. Although many Americans in households making more than $100,000 consider themselves middle class, particularly those living in expensive regions like the Northeast and Pacific Coast, they have substantially more money than most people.

However the lines are drawn, it is clear that millions are struggling to hang on to accouterments that most experts consider essential to a middle-class life.

“I would consider middle class to be people who can live comfortably on what they earn, can pay their bills, can set aside something to save for retirement and for kids in college and can have vacations and entertainment,” said Christine L. Owens, executive director of the National Employment Law Project . . .

Even as the American middle class has shrunk, it has gone through a transformation. The 53 million households that remain in the middle class — about 43 percent of all households — look considerably different from their middle-class predecessors of a previous generation, according to a New York Times analysis of census data.

In recent years, the fastest-growing component of the new middle class has been households headed by people 65 and older. Today’s seniors have better retirement benefits than previous generations. Also, older Americans are increasingly working past traditional retirement age. More than eight million, or 19 percent, were in the labor force in 2013, nearly twice as many as in 2000.

The growing prominence of older people in the middle class reflects, in part, the way Social Security and Medicare — originally set up as safety nets to protect seniors from falling into poverty after retirement — have provided a substantial cushion for them against hard times.

Married couples with children — who make up a category that is shrinking over all — are diminishing even faster as a share of the middle class. In the late 1960s, about 45 percent of all households included married adults and their offspring. But among middle-class households, more than 60 percent had that traditional family arrangement.

Today, married couples with children at home make up just a quarter of households.

The most recent recession put a halt to the advances of even that generally successful group. Its share in the middle class has fallen by three percentage points and the share earning less than $35,000 has increased.

“In the Great Recession, we lost a lot of middle-income jobs and we gained a lot of low-paying jobs,” said Michael R. Strain, resident scholar at the right-of-center American Enterprise Institute.

According to a New York Times poll in December, 60 percent of people who call themselves middle class think that if they work hard they will get rich. But the evidence suggests that goal is increasingly out of reach. When middle class people look up, they see the rich getting richer while they spin their wheels.

“The middle has basically stayed the same; it hasn’t improved,” said Lawrence F. Katz, an economist at Harvard University.

What is the most frustrating to me is how the GOP continues to use religion and racism to sucker idiot voters to vote for Republicans even as the GOP pushes policies that will harm those very same voters.  Thus, if one wants upward social mobility, nowadays, one needs to move to Europe.

The Myth of the "American Dream"

Most Americans - and likely most immigrants whether documented or not - believe in the so-called "American Dream" - the idea that through hard work anyone can rise to wealth and influence.  Increasingly, the reality is something quite different from Americas' ideas about upward social mobility (it's higher now in "Old Europe" than in America) and wealth inequality.  Indeed, most Americans would be shocked - or perhaps sickened - if they really focused on the reality of American society.  Yet the myth of the "American Dream" persists and allows plutocrats and their minions in elected office to continue the push to return America to a new Gilded Age that is wonderful for the wealthy, but frightening for most of us.  A piece in Salon looks at the reality and how the "American Dream" acts as an opiate for the masses.  Here are excerpts:

Multiple studies have shown that Americans seriously underestimate the degree of inequality in the U.S. economy. As Slate’s  Jordan Weissman noted in September, subjects in one test “estimated that the top 20 percent of U.S. households owned about 59 percent of the country’s net worth,” when in truth the number is closer to 84 percent. Moreover, the same study shows that even if the wealth of the U.S. economy was distributed like they’d believed, most Americans would still consider it too unequal. And these findings were consistent across many social groups; from Republicans to Democrats, from men to women, from the rich to the poor. No matter your vantage, it seems, Americans’ perception and their reality is not in sync.

[W]hile the gap between perception and reality was most pronounced in Americans, people from other developed (and increasingly unequal) economies also came up with ideal distributions that were markedly different from their countries’ actual status quo. What separates Americans from others, though — what makes inequality of this kind sustainable in the U.S. in a way that in other democracies isn’t; what makes the gap between perception and reality that Rock alluded to so difficult to bridge — is their faith in one of the greatest branding exercises in human history. I speak, of course, of the American Dream.

The American Dream isn’t new, of course, and it didn’t pop up as a response to the great divergence that started in the early 1970s. It’s been around for more than 100 years, and there really was a time, during the late 1800s, when rising wages and rags-to-riches stories made the theory at least plausible. But as the aforementioned U.C. Davis researcher Gregory Clark has found in a recent (paywalled) study, even if the American Dream was real in the past, it’s no longer operational today. “America has no higher rate of social mobility than medieval England or pre-industrial Sweden,”

Currently, the gap between perception and reality in U.S. society is papered over by the American Dream and its vow that regular people, through hard work and perseverance, will be able to get ahead. That dynamic won’t change until more Americans realize that the American Dream today is just an empty promise. But if that ever happens, the 1 percent and the stewards of government will have a whole lot more trouble on their hands than Chris Rock’s hypothetical riots.

Like religion, the "American Dream" is a great tool for keeping the masses docile and working for the powers that be and a system that is all too often rigged against most of us.  Of course, the 1% and their political whores like it that way.

The American Dream Is Leaving America

A column in the New York Times addresses a theme I have hit on before: "Old Europe" as the far right derisively call it has more upward social mobility than America and now is poised to have a higher percentage of colleges graduates than America.  One of the favorite targets of today's GOP when it comes to budget cuts is public education followed, of course, by cuts to the social safety net.  Why the antipathy towards education?  I would argue greed/selfishness among the GOP base that pushes adherents to not give a damn about others - despite the professions of respect for Christian values - and the Christofascist/Tea party's embrace of ignorance and aversion to any science and modern knowledge that challenges their increasing indefensible religious beliefs.  Then too, there is the way public education is funded in America: real estate taxes which put poor neighborhoods behind the eight ball even those these neighborhoods need education more than any where.  Here are column highlights:

THE best escalator to opportunity in America is education. But a new study underscores that the escalator is broken.

We expect each generation to do better, but, currently, more young American men have less education (29 percent) than their parents than have more education (20 percent).

Among young Americans whose parents didn’t graduate from high school, only 5 percent make it through college themselves. In other rich countries, the figure is 23 percent.

The United States is devoting billions of dollars to compete with Russia militarily, but maybe we should try to compete educationally. Russia now has the largest percentage of adults with a university education of any industrialized country — a position once held by the United States, although we’re plunging in that roster.

A basic element of the American dream is equal access to education as the lubricant of social and economic mobility. But the American dream seems to have emigrated because many countries do better than the United States in educational mobility, according to the O.E.C.D. study.

As recently as 2000, the United States still ranked second in the share of the population with a college degree. Now we have dropped to fifth. Among 25-to-34-year-olds — a glimpse of how we will rank in the future — we rank 12th, while once-impoverished South Korea tops the list.

A new Pew survey finds that Americans consider the greatest threat to our country to be the growing gap between the rich and poor. Yet we have constructed an education system, dependent on local property taxes, that provides great schools for the rich kids in the suburbs who need the least help, and broken, dangerous schools for inner-city children who desperately need a helping hand. Too often, America’s education system amplifies not opportunity but inequality.

[E]galitarian education used to be America’s strong suit. European countries excelled at first-rate education for the elites, but the United States led the way in mass education.

In effect, the United States has become 19th-century Britain: We provide superb education for elites, but we falter at mass education.

In particular, we fail at early education. Across the O.E.C.D., an average of 70 percent of 3-year-olds are enrolled in education programs. In the United States, it’s 38 percent.

In some quarters, there’s a perception that American teachers are lazy. But the O.E.C.D. report indicates that American teachers work far longer hours than their counterparts abroad. Yet American teachers earn 68 percent as much as the average American college-educated worker, while the O.E.C.D. average is 88 percent.

All of this is fine with the GOP which is striving hard to recreate the Gilded Age and its shocking wealth disparities. 

Can Challengers Reform the GOP?

While the Christofascists and their Tea Party Siamese twins continue to strive the Republican further into insanity, a few conservatives are trying to reform the GOP and make it more in touch with the reality of today's economic realities and society in general.  Given the entrenched position of the anti-modernity and anti-objective reality crowd in the GOP base, such reform efforts may yet prove to be little more than tilting at windmills.  A column in the New York Times looks at the effort which I suspect may prove fruitless - at least until the Christofascists and Tea Party factions are driven from the base.  Here are column highlights:

[P]eople on the right have been slow to recognize the deep structural problems that are making life harder in the new economy — that are leading to stagnant social mobility, widening inequality and pervasive insecurity.

But some conservatives have begun to face these issues head on. These reform conservatives have now published a policy-laden manifesto called “Room to Grow,” which is the most coherent and compelling policy agenda the American right has produced this century.

In the first essay of the book, Peter Wehner moves beyond the ruinous Republican view that the country is divided between hearty entrepreneurs and parasitic “takers.” Like most reform conservatives, he shifts attention sympathetically to the struggling working and middle classes. He grapples with the fact, uncomfortable for conservatives, that the odds of escaping poverty are about half as high in the United States as in more mobile countries like Denmark.

Today, millions of Americans are behaving in ways that make no economic sense: dropping out of school, having children out of wedlock. They do so because the social guardrails that used to guide behavior have dissolved. Giving people in these circumstances tax credits is not going to lead to long-term thinking. Putting more risk into vulnerable people’s lives may not make them happier.

The nanny state may have drained civil society, but simply removing the nanny state will not restore it. There have to be programs that encourage local paternalism: early education programs with wraparound services to reinforce parenting skills, social entrepreneurship funds to reweave community, paternalistic welfare rules to encourage work.

Moreover, the U.S. economy is increasingly competing against autocratic economies, which play by their own self-serving rules.

Sometimes government is going to have to be active to disrupt local oligarchies and global autocracies by fomenting creative destruction — by insisting on dynamic immigration policies, by pumping money into research, by creating urban environments that nurture innovation, by spending money to give those outside the clusters new paths to rise.

I’d say the reform conservatives are still a little too Jeffersonian. They have a bit too much faith in the magic of decentralization. Some decentralized reforms do nurture personal responsibility and community flourishing. But as Alexander Hamilton (and Margaret Thatcher) understood, sometimes decentralization needs to be complemented with energetic national policies, to disrupt local oligarchies, self-serving arrangements and gradual national decline.

The Death of the American Dream - It’s Now the Canadian Dream

With three children of my own, I like so many do not believe that my children will have the opportunities that I had for to achieve the so-called American Dream, much less the opportunities that my parents had.  Why?  Because, in my view, America is headed in the wrong direction economically and to some extent socially.  Once upon a time, there was more of a sense of "we're all in this together" and that when the country built infrastructure, we all benefited.  Now, if the GOP had its way, America would be a completely cruel Ayn Rand world  where everyone simply fought to keep what was theirs and there would be no concept at all of the common good.  Add in globalization of the economy and the USA is headed for a situation like Great Britain found itself in following WWII.  Ironically, the far right blames "socialism" for America's predicament, yet Canada, our neighbor to the north is far more socialistic and it is now the nation that has taken over the dream that was once America's.  Even "Old Europe" now has more social upward mobility.  A column in the New York Times looks at America's decline, much of which has been self-induced.  Here are excerpts:

It was in 1931 that the historian James Truslow Adams coined the phrase “the American dream.”

The American dream is not just a yearning for affluence, Adams said, but also for the chance to overcome barriers and social class, to become the best that we can be. Adams acknowledged that the United States didn’t fully live up to that ideal, but he argued that America came closer than anywhere else.

Adams was right at the time, and for decades. When my father, an eastern European refugee, reached France after World War II, he was determined to continue to the United States because it was less class bound, more meritocratic and offered more opportunity.

Yet today the American dream has derailed, partly because of growing inequality. Or maybe the American dream has just swapped citizenship, for now it is more likely to be found in Canada or Europe — and a central issue in this year’s political campaigns should be how to repatriate it.

A report last month in The Times by David Leonhardt and Kevin Quealy noted that the American middle class is no longer the richest in the world, with Canada apparently pulling ahead in median after-tax income. Other countries in Europe are poised to overtake us as well.

In fact, the discrepancy is arguably even greater. Canadians receive essentially free health care, while Americans pay for part of their health care costs with after-tax dollars. Meanwhile, the American worker toils, on average, 4.6 percent more hours than a Canadian worker, 21 percent more hours than a French worker and an astonishing 28 percent more hours than a German worker, according to data from the Organization for Economic Cooperation and Development.

Canadians and Europeans also live longer, on average, than Americans do. Their children are less likely to die than ours. American women are twice as likely to die as a result of pregnancy or childbirth as Canadian women. And, while our universities are still the best in the world, children in other industrialized countries, on average, get a better education than ours.

[S]everal studies show that a child born in the bottom 20 percent economically is less likely to rise to the top in America than in Europe. A Danish child is twice as likely to rise as an American child.

Three data points:

The top 1 percent in America now own assets worth more than those held by the entire bottom 90 percent.

The six Walmart heirs are worth as much as the bottom 41 percent of American households put together.

The top six hedge fund managers and traders averaged more than $2 billion each in earnings last year, partly because of the egregious “carried interest” tax break. President Obama has been unable to get financing for universal prekindergarten; this year’s proposed federal budget for pre-K for all, so important to our nation’s future, would be a bit more than a single month’s earnings for those six tycoons.

It’s time to bring the American dream home from exile.

The irony is that much of the path for America's decline tracks to failed GOP policies.  More ironically yet, the decline corresponds to the rise of the selfish, anti-knowledge Christofascists in the Republican Party.   The far right loves to talk about American exceptionalism, yet it is they who are killing it.

America's Failed Economic Recovery

Social mobility continues to plummet in America while increasing in what the Republicans like to call "Old Europe."  Who would have ever thought that Europe with its former rigid class systems and hereditary titles would provide more promise than America and the so-called American dream which is fading for many and those in the Millennial Generation in particular.  What's also amazing is that those pushing for a cruel oligarchy in this country - e.g. the Koch brothers and much of the GOP - seem to have forgotten that throughout history sooner or later the masses have revolted - sometimes violently - against oligarchs who have been suffused with greed and mistreated the rest of society.  A main editorial in the New York Times looks at how the future prospects for our younger generations is shockingly fading.  One has to wonder when the reckoning will eventually come.  Here are highlights:

The official line is clear: The worst is over, and recovery has given way to expansion.

But that’s not the whole story. Economic gains so far have mostly benefited those at the top of the income and wealth ladder. Worse, future growth is likely to be lopsided, because the foundation for broad prosperity is arguably the weakest it has been since World War II.

Take, for example, Americans age 25 to 34, the leading edge of the so-called millennials, the generation born in the 1980s and 1990s. They are worse off than Gen Xers (born from the mid-1960s to the late-1970s) were at that age and the baby boomers before them by nearly every economic measure — employment, income, student loan indebtedness, mobility, homeownership and other hallmarks of “household formation,” like moving out on their own, getting married and having children.

This group had the bad luck of entering the work force in the depressed and slow-growth years that started when the recession hit in 2007. Instead of spending the crucial early years of their work lives laying the groundwork for a solid economic future, many of them have struggled with unemployment and underemployment, and many have fallen so far behind where they would hope to be that recovering lost ground may well be impossible.

According to the latest census data, nearly 16 percent of those in their mid-20s to mid-30s were in poverty in 2012, compared with just above 10 percent of Gen Xers in 2000 and baby boomers in 1980. Nearly 14 percent of that age group were living with their parents in 2013, a higher percentage than in previous generations. And of those living at home, 43 percent (2.5 million people) would be counted as being in poverty if they were on their own.
Some of the trends in the latest data were evident before the recession, especially stagnating wages, delayed marriage and later childbearing. But the poor economy has intensified those conditions. For instance, in a study by the Pew Research Center of the entire millennial generation, 74 percent were unmarried; many of them said they wanted to marry but lacked the economic wherewithal.

What is shocking is that despite the known danger and despite the prolonged bad economy, more government resources have not been used to prevent and reverse such a huge waste of human capital. Instead, public resources for job creation and even for unemployment benefits have been too little and too late, if available at all.

Another shocker is that those in the 25-to-34 age group are the best educated cohort in American history, with more than a third having a bachelor’s degree or higher. Education is important. But clearly, education alone does not create jobs and opportunities that lead to prosperity. For that, a fair and functional economy is needed — one in which the government plays a robust role, alongside consumers and businesses, to promote full employment and to ensure a just distribution of gains.

Younger millennials are not appreciably better off than their older peers, though they have not yet lost as much ground. At the other end of the spectrum, many older Americans who lost jobs and assets in the recession also face an uncertain future.

Certain sectors of the economy, especially the financial markets, are indeed turning a corner. But true prosperity is impossible when the productive potential of young adults is being squandered.

Just as the GOP is courting long term political suicide by courting declining numbers of aging, angry white voters, so too are they setting the stage for a potential overthrow of the system they claim to honor.

Today's GOP - That Old-Time Whistle

As a former Republican I am continually sickened by the increasing racism that seems to have become a main plank of the GOP.  Worse yet, many GOP politicians are making less and less of an effort to even try to disguise the dog whistle messages being sent to the ugly base of the party.  While not all GOP politicians are racists, it is disturbing that far too many seem to have any problem being involved with outright racists.  A column in the New York Times looks at the disturbing phenomenon.  Here are excerpts:

There are many negative things you can say about Paul Ryan, chairman of the House Budget Committee and the G.O.P.’s de facto intellectual leader. But you have to admit that he’s a very articulate guy, an expert at sounding as if he knows what he’s talking about.

So it’s comical, in a way, to see Mr. Ryan trying to explain away some recent remarks in which he attributed persistent poverty to a “culture, in our inner cities in particular, of men not working and just generations of men not even thinking about working.” He was, he says, simply being “inarticulate.” How could anyone suggest that it was a racial dog-whistle? Why, he even cited the work of serious scholars — people like Charles Murray, most famous for arguing that blacks are genetically inferior to whites. Oh, wait.

Just to be clear, there’s no evidence that Mr. Ryan is personally a racist, and his dog-whistle may not even have been deliberate. But it doesn’t matter. He said what he said because that’s the kind of thing conservatives say to each other all the time. And why do they say such things? Because American conservatism is still, after all these years, largely driven by claims that liberals are taking away your hard-earned money and giving it to Those People. 

Indeed, race is the Rosetta Stone that makes sense of many otherwise incomprehensible aspects of U.S. politics.

We are told, for example, that conservatives are against big government and high spending. Yet even as Republican governors and state legislatures block the expansion of Medicaid, the G.O.P. angrily denounces modest cost-saving measures for Medicare. How can this contradiction be explained? Well, what do many Medicaid recipients look like — and I’m talking about the color of their skin, not the content of their character — and how does that compare with the typical Medicare beneficiary? Mystery solved.

Or we’re told that conservatives, the Tea Party in particular, oppose handouts because they believe in personal responsibility, in a society in which people must bear the consequences of their actions. Yet it’s hard to find angry Tea Party denunciations of huge Wall Street bailouts, of huge bonuses paid to executives who were saved from disaster by government backing and guarantees.

Right-wingers rage against tales of food stamp abuse that almost always turn out to be false or at least greatly exaggerated. And Mr. Ryan’s black-men-don’t-want-to-work theory of poverty is decades out of date.

In the 1970s it was still possible to claim in good faith that there was plenty of opportunity in America, and that poverty persisted only because of cultural breakdown among African-Americans. . . . . But over the past 40 years good jobs for ordinary workers have disappeared, not just from inner cities but everywhere: adjusted for inflation, wages have fallen for 60 percent of working American men. 

And as economic opportunity has shriveled for half the population, many behaviors that used to be held up as demonstrations of black cultural breakdown — the breakdown of marriage, drug abuse, and so on — have spread among working-class whites too. 

These awkward facts have not, however, penetrated the world of conservative ideology. Earlier this month the House Budget Committee, under Mr. Ryan’s direction, released a 205-page report on the alleged failure of the War on Poverty. What does the report have to say about the impact of falling real wages? It never mentions the subject at all.

And since conservatives can’t bring themselves to acknowledge the reality of what’s happening to opportunity in America, they’re left with nothing but that old-time dog whistle.

Sadly, racism and hypocrisy have become two of the main pillars of today's GOP and the conservative movement in general.  It is a disgusting truth that those on the right refuse to admit. 

Social Mobility Is Lowest in the South/Bible Belt

Click image to enlarge

I often mark the argument that backwardness and bigotry are impediments to economic progress.  A new study reported on by the New York Times would seem to corroborate this premise in significant part.  Where is social mobility the lowest?  In the South and Bible Belt, of course.  Where is it higher?  Except for some surprising exceptions in the sparsely settled mid-west, in the Northeast and in the far west.  In short, progressive areas where racism and homophobia are less prevalent provide a better opportunity for those born into the bottom economic classes of society to move up.  In Virginia, the highest social mobility is not surprisingly found in Northern Virginia.  The lowest social mobility is found across Virginia's largely reactionary south side - and area where the "godly Christians" hold sway.  As for Hampton Roads, it does not fare too well either, something that ought to send a warning bell to area leaders.  Here are article highlights:

The study — based on millions of anonymous earnings records and being released this week by a team of top academic economists — is the first with enough data to compare upward mobility across metropolitan areas. These comparisons provide some of the most powerful evidence so far about the factors that seem to drive people’s chances of rising beyond the station of their birth, including education, family structure and the economic layout of metropolitan areas. 

Climbing the income ladder occurs less often in the Southeast and industrial Midwest, the data shows, with the odds notably low in Atlanta, Charlotte, Memphis, Raleigh, Indianapolis, Cincinnati and Columbus. By contrast, some of the highest rates occur in the Northeast, Great Plains and West, including in New York, Boston, Salt Lake City, Pittsburgh, Seattle and large swaths of California and Minnesota. 

“Where you grow up matters,” said Nathaniel Hendren, a Harvard economist and one of the study’s authors. “There is tremendous variation across the U.S. in the extent to which kids can rise out of poverty.” 

That variation does not stem simply from the fact that some areas have higher average incomes: upward mobility rates, Mr. Hendren added, often differ sharply in areas where average income is similar, like Atlanta and Seattle. 

The gaps can be stark. On average, fairly poor children in Seattle — those who grew up in the 25th percentile of the national income distribution — do as well financially when they grow up as middle-class children — those who grew up at the 50th percentile — from Atlanta. 

[T]he researchers identified four broad factors that appeared to affect income mobility, including the size and dispersion of the local middle class. All else being equal, upward mobility tended to be higher in metropolitan areas where poor families were more dispersed among mixed-income neighborhoods.

Income mobility was also higher in areas with more two-parent households, better elementary schools and high schools, and more civic engagement, including membership in religious and community groups. 

Regions with larger black populations had lower upward-mobility rates. But the researchers’ analysis suggested that this was not primarily because of their race. Both white and black residents of Atlanta have low upward mobility, for instance. 

In previous studies of mobility, economists have found that a smaller percentage of people escape childhood poverty in the United States than in several other rich countries, including Canada, Australia, France, Germany and Japan. The latest study is consistent with those findings. 

That pattern makes economists more confident that the characteristics of different regions — as opposed to something inherent and unchangeable in the local residents — are helping cause the varying mobility rates. 

Rich Man’s Recovery

The Republican Party's goal for America is a return to the Gilded Age when multimillionaires lived like royalty and the rest of us lived like serfs and feudal vassals.  Unfortunately, this goal is coming into fruition as social mobility is now greater in Europe than in America and the wealthy disparities are so great that they would shock banana republic rulers of old.  They myth of the American Dream is dying for most Americans and many realize that their children will not have a better life and more financial security that they or their parents enjoyed.  It is demoralizing, but this what is happening.  A column in the New York Times looks at the ugly reality.  Here are excerpts:

A few days ago, The Times published a report on a society that is being undermined by extreme inequality. This society claims to reward the best and brightest regardless of family background. In practice, however, the children of the wealthy benefit from opportunities and connections unavailable to children of the middle and working classes. And it was clear from the article that the gap between the society’s meritocratic ideology and its increasingly oligarchic reality is having a deeply demoralizing effect. 

The report illustrated in a nutshell why extreme inequality is destructive, why claims ring hollow that inequality of outcomes doesn’t matter as long as there is equality of opportunity. If the rich are so much richer than the rest that they live in a different social and material universe, that fact in itself makes nonsense of any notion of equal opportunity. 

By the way, which society are we talking about? The answer is: the Harvard Business School. . . .

The point, of course, is that as the business school goes, so goes America, only even more so — a point driven home by the latest data on taxpayer incomes. 

The data in question have been compiled for the past decade by the economists Thomas Piketty and Emmanuel Saez, who use I.R.S. numbers to estimate the concentration of income in America’s upper strata. According to their estimates, top income shares took a hit during the Great Recession, as things like capital gains and Wall Street bonuses temporarily dried up. But the rich have come roaring back, to such an extent that 95 percent of the gains from economic recovery since 2009 have gone to the famous 1 percent. In fact, more than 60 percent of the gains went to the top 0.1 percent, people with annual incomes of more than $1.9 million.

Only a small fraction of college graduates make it into the charmed circle of the 1 percent. Meanwhile, many, even most, highly educated young people are having a very rough time. They have their degrees, often acquired at the cost of heavy debts, but many remain unemployed or underemployed, while many more find that they are employed in jobs that make no use of their expensive educations. The college graduate serving lattes at Starbucks is a cliché, but he reflects a very real situation.

[W]hatever is causing the growing concentration of income at the top, the effect of that concentration is to undermine all the values that define America. Year by year, we’re diverging from our ideals. Inherited privilege is crowding out equality of opportunity; the power of money is crowding out effective democracy.

So what can be done? For the moment, the kind of transformation that took place under the New Deal — a transformation that created a middle-class society, not just through government programs, but by greatly increasing workers’ bargaining power — seems politically out of reach. But that doesn’t mean we should give up on smaller steps, initiatives that do at least a bit to level the playing field. 

Take, for example, the proposal by Bill de Blasio, who finished in first place in Tuesday’s Democratic primary and is the probable next mayor of New York, to provide universal prekindergarten education, paid for with a small tax surcharge on those with incomes over $500,000. The usual suspects are, of course, screaming and talking about their hurt feelings; they’ve been doing a lot of that these past few years, even while making out like bandits. But surely this is exactly the sort of thing we should be doing: Taxing the ever-richer rich, at least a bit, to expand opportunity for the children of the less fortunate. 

Some pundits are already suggesting that Mr. de Blasio’s unexpected rise is the leading edge of a new economic populism that will shake up our whole political system. That seems premature, but I hope they’re right. For extreme inequality is still on the rise — and it’s poisoning our society. 

Decline of Social Mobility Erodes the American Dream

The mythology of America is that anyone can make it here and escape their more humble beginnings and move up socially and financially.  Once upon a time this myth was largely true, but nowadays, if one wants to enjoy social mobility, one needs to leave America and move to "Old Europe" as the Neanderthals of the Republican Party and the Tea Party nit wits like to refer to Europe which now displays more possibilities for upward social mobility than America that seems to be headed back to the Gilded Age and a society with a handful of the "haves" and  vast multitudes of the "have nots."  A column in the Washington Post looks at America's increasingly bleak prospects for upward social  mobility.  What's especially telling is that the GOP wants to slash the support programs for the poor that might otherwise allow the poor to prosper.  It is the antithesis of the Gospel message that the Christofascist base of the GOP purports to worship and honor.  Here are excerpts:

The American dream at its core is that a person, no matter his or her background, can make it here. A few weeks ago, four economists at Harvard and the University of California at Berkeley released a path-breaking study of mobility within the United States. And last week the Journal of Economic Perspectives published a series of essays tackling the question from an international standpoint.

For more than a decade, it has been documented that Northern European countries do better at moving poor people up the ladder than the United States does. Some have dismissed these findings . . . . But Miles Corak of the University of Ottawa points out in his contribution to the Journal of Economic Perspectives that Canada is a very useful point of comparison, being much like the United States. (The percentage of foreign-born Canadians is actually higher than the percentage of foreign-born Americans, for example.) And recent research finds that people in Canada and Australia have twice the economic mobility of Americans. (The British are about the same as Americans but much worse than Canadians and Australians. )

The most important correlation in the Harvard-Berkeley study appears to be social capital. Cities with strong families, civic support groups and a community-service orientation do well on social and economic mobility. That’s why Salt Lake City — dominated by Mormons — has mobility levels that compare with Denmark’s. This would also explain why America in general fares badly; the United States has many more broken families, single parents and dysfunctional domestic arrangements than do Canada and Europe. The other notable feature in the Harvard-Berkeley study is the design of cities. Places that are segregated — where the poor live far from the middle class — do much worse than those that are more mixed.

That leaves the last large factor in explaining the low mobility: public policy. And here, Corak explains, the United States is the great outlier. Simply put, the United States spends much less on the education and well-being of poor people, especially poor children, than any other rich country — and that retards their chances of escaping poverty. 

[T]he well-off in the United States spend nearly $9,000 a year on books, computers, child care and summer camps — nearly seven times what families in the bottom fifth of earners spend. In fact, this is part of what makes mobility low.

In any event, what’s apparent is that countries — and most parts of the United States — that invest heavily in all their children’s health care, nutrition and education end up with a much stronger ladder of opportunity and access. And that’s something we can change. So if we want to restore the American dream, we now have the beginnings of a path forward.

I tease at times that today's GOP is the bridge to the 11th century, but the GOP's policies seem hell bent on reestablishing the wealth disparities of the Middle Ages, with most Americans becoming serfs and peasants.t 

The Decline of American Society and the Revolt of the Global Middle Class

As the parent of three adult children it is interesting that none of my children expect to do as well financially or to have the life style that my late parents achieved.  Admittedly, my parents died as millionaires, but neither I nor my siblings can be assured of the same financial success in our lifetimes and for our children the deck is stacked even more decidedly in favor of the truly wealthy as social mobility in America falls behind that of Europe and wealth disparities exceed those of former banana republics.  It is little wonder why the Republican Party is faring poorly with younger voters.   But the phenomenon is not limited to  America as we see unrest in Brazil and Turkey and other nations as well.  Sadly, the status quo favors the few and the rest of us are increasingly expected to be satisfied with the table scraps that are left over.  A piece in The Guardian looks at what has happened to America.  Here are highlights:

In or around 1978, America's character changed. For almost half a century, the United States had been a relatively egalitarian, secure, middle-class democracy, with structures in place that supported the aspirations of ordinary people. You might call it the period of the Roosevelt Republic. Wars, strikes, racial tensions and youth rebellion all roiled national life, but a basic deal among Americans still held, in belief if not always in fact: work hard, follow the rules, educate your children, and you will be rewarded, not just with a decent life and the prospect of a better one for your kids, but with recognition from society, a place at the table.

This unwritten contract came with a series of riders and clauses that left large numbers of Americans – black people and other minorities, women, gay people – out, or only halfway in. But the country had the tools to correct its own flaws, and it used them: healthy democratic institutions such as Congress, courts, churches, schools, news organizations, business-labour partnerships.

The large currents of the past generation – deindustrialisation, the flattening of average wages, the financialisation of the economy, income inequality, the growth of information technology, the flood of money into Washington, the rise of the political right – all had their origins in the late 70s.  ..

The institutions that had been the foundation of middle-class democracy, from public schools and secure jobs to flourishing newspapers and functioning legislatures, were set on the course of a long decline. It as a period that I call the Unwinding.

Once American pre-eminence was challenged by international competitors, and the economy hit rough seas in the 70s, and the sense of existential threat from abroad subsided, the deal was off. Globalisation, technology and immigration hurried the Unwinding along, as inexorable as winds and tides. It is sentimental at best, if not ahistorical, to imagine that the social contract could ever have survived – like wanting to hang on to a world of nuclear families and manual typewriters.

But there was nothing inevitable about the aftermath – an unmanaged free-for-all in which unemployed workers were left to fend for themselves, while corporate raiders bought the idle hulks of the mills with debt in the form of junk bonds and stripped out the remaining value. It may have been inevitable that the constraints imposed on US banks by the Glass-Steagall Act of 1933 would start to slip off in the era of global finance. But it was a political choice on the part of Congress and President Bill Clinton to deregulate Wall Street so thoroughly that nothing stood between the big banks and the destruction of the economy.

Much has been written about the effects of globalisation during the past generation. Much less has been said about the change in social norms that accompanied it. American elites took the vast transformation of the economy as a signal to rewrite the rules that used to govern their behaviour: a senator only resorting to the filibuster on rare occasions; a CEO limiting his salary to only 40 times what his average employees made instead of 800 times; a giant corporation paying its share of taxes instead of inventing creative ways to pay next to zero. There will always be isolated lawbreakers in high places; what destroys morale below is the systematic corner-cutting, the rule-bending, the self-dealing.

It is little wonder that many younger voters have little faith in America and the future.  But the phenomenon is not limited to America as noted in a piece in The Atlantic which notes that what has happened in America is happening elsewhere - e.g., Brazil and Turkey.  Here are excerpts from that article:

From Turkey to Brazil to Iran the global middle class is awakening politically. The size, focus and scope of protests vary, but this is not unfolding chaos -- it is nascent democracy. Citizens are demanding basic political rights, accountable governments and a fairer share of resources.  

Overall, though, Americans jaded about world affairs should see the activism as positive. The protesters are performing the same role as middle classes have in developed nations. As their standard of living rises, so do their expectations of government.

The political dynamic in each country is different, of course. In Turkey, the protests are not the equivalent of the Arab Spring demonstrations that toppled governments across the Middle East. Nor are they simply a pitched battle between religious conservatives and secular liberals. Instead, they are deeply Turkish -- and hugely important.

Brazil presents a different dynamic.The ruling Workers' Party is left-leaning and its economic reforms have helped the poor and middle class. But now a souring economy, corruption scandals and $12 billion in government spending on 2014 World Cup stadiums has sparked one million people to take to the streets.

Marcelo Ridenti, a leading Brazilian sociologist, said reduced inequality and increased education have raised expectations. The number of university students in Brazil, for example, doubled from 2000 to 2011.

"This generates huge changes in society, including changes in expectations among young people," he told the New York Times . "They expect to get not only jobs, but good jobs."  

Pro-reform and urban Iranians frustrated with the country's weak economy, isolation and conservative monopoly on power apparently handed Rohani the presidency. Rohani may prove to be more conservative than expected, but his victory prompted thousands of Iranians to take to the streets.

"I am hopeful about the future," Hoda, a 26-year-old who asked that her last name not be used, told Reuters. "Hopeful that we will have more social freedoms, more stability in Iran, better relations with other countries and hopefully a much better economy.".

[O]bservers see parallels between Brazil's protests, India's anti-corruption movement , austerity protests in Europe, the U.S. Occupy Movement and similar demonstrations in Israel. 

First, the explosive spread of social media played a role in the movements. Networks of like-minded people were able to immediately communicate with one another -- and potential recruits. Some online information has been false orrestricted, but technological change has unquestionably sped up the pace of political organizing.

Second, all three movements are demanding basic individual rights and accountable government. They want non-corrupt leaders who respect their right to protest, gather and speak freely. From minority rights in Turkey, to fair elections in Iran, to better policing, healthcare and transit in Brazil, protesters want improved governance. 

That's right. These overseas movements want many many Americans want. especially an accountable government.  Barack Obama and Congressional Republicans, are you listening??  History has a lesson: when the majority of citizens are finding it harder and harder to survive, their interest in supporting the current political structure declines and governments fall, be it in ancient Rome or elsewhere.rest in supporting the

The GOP's Corrosive Push for Austerity

To listen to GOP demagogues one would think they gave at least a slight thought about the lies they are destroying as their policies continue to create a permanent under class.  The true focus of the GOP is the wealthy and the incredibly selfish members of the Christofascist/Tea Party base of the party.  These folks truly do not care about the fellow citizens despite all their self congratulatory back patting and feigned piety.  An op-ed in the New York Times looks at the society cost that the GOP obsession with budget cuts and lower taxes is fueling.  It's not pretty and the future consequences will be even uglier as wealth disparities continue to soar and social mobility decreases.  Here are column excerpts:

F.D.R. told us that the only thing we had to fear was fear itself. But when future historians look back at our monstrously failed response to economic depression, they probably won’t blame fear, per se. Instead, they’ll castigate our leaders for fearing the wrong things.

But while debt fears were and are misguided, there’s a real danger we’ve ignored: the corrosive effect, social and economic, of persistent high unemployment. And even as the case for debt hysteria is collapsing, our worst fears about the damage from long-term unemployment are being confirmed. 

Now, some unemployment is inevitable in an ever-changing economy. Modern America tends to have an unemployment rate of 5 percent or more even in good times. In these good times, however, spells of unemployment are typically brief. Back in 2007 there were about seven million unemployed Americans — but only a small fraction of this total, around 1.2 million, had been out of work more than six months. 

Then financial crisis struck, leading to a terrifying economic plunge followed by a weak recovery. Five years after the crisis, unemployment remains elevated, with almost 12 million Americans out of work. But what’s really striking is the huge number of long-term unemployed, with 4.6 million unemployed more than six months and more than three million who have been jobless for a year or more. Oh, and these numbers don’t count those who have given up looking for work because there are no jobs to be found. 

It goes without saying that the explosion of long-term unemployment is a tragedy for the unemployed themselves. But it may also be a broader economic disaster.  The key question is whether workers who have been unemployed for a long time eventually come to be seen as unemployable, tainted goods that nobody will buy.  .   .   .   .   there is, unfortunately, growing evidence that the tainting of the long-term unemployed is happening as we speak. .   .   .   .  a rising number of job openings doesn’t seem to do much to reduce their numbers. It’s as if employers don’t even bother looking at anyone who has been out of work for a long time. 

[W]orkers who reported having been unemployed for six months or more got very few callbacks, even when all their other qualifications were better than those of workers who did attract employer interest.   So we are indeed creating a permanent class of jobless Americans. 

And let’s be clear: this is a policy decision. The main reason our economic recovery has been so weak is that, spooked by fear-mongering over debt, we’ve been doing exactly what basic macroeconomics says you shouldn’t do — cutting government spending in the face of a depressed economy. 

It’s hard to overstate how self-destructive this policy is. Indeed, the shadow of long-term unemployment means that austerity policies are counterproductive even in purely fiscal terms. Workers, after all, are taxpayers too; if our debt obsession exiles millions of Americans from productive employment, it will cut into future revenues and raise future deficits. 

Our exaggerated fear of debt is, in short, creating a slow-motion catastrophe. It’s ruining many lives, and at the same time making us poorer and weaker in every way. And the longer we persist in this folly, the greater the damage will be.

The Opiate of American Exceptionalism

I have often complained about the myth of American exceptionalism that plays so well with the Christofascist/Tea Party base of the Republican Party.  What better way to avoid facing reality than to (i) cling to a myth that America outshines every other nation on earth and (ii) refuse to accept objective reality that shows that America has many, many problems and that in numerous categories, America ranks far down the list compared to other nations which the Kool-Aid drinking loons of the GOP love to deride.  Frankly, it's part and parcel with the alternate universe the far right inhabits where facts, science and the truth are ignored and/or denied as much as possible.  It also fits perfectly with the Christianist myth that America was founded as a "Christian nation." A piece in the Sunday Review provides some stark data that underscores the lie of the cult of American exceptionalism.  It's not a pretty picture, but it is based on objective reality.  Here are some excerpts:

What might this mythical candidate talk about on the stump? He might vow to turn around the dismal statistics on child poverty, declaring it an outrage that of the 35 most economically advanced countries, the United States ranks 34th, edging out only Romania. He might take on educational achievement, noting that this country comes in only 28th in the percentage of 4-year-olds enrolled in preschool, and at the other end of the scale, 14th in the percentage of 25-to-34-year-olds with a higher education. He might hammer on infant mortality, where the United States ranks worse than 48 other countries and territories, or point out that, contrary to fervent popular belief, the United States trails most of Europe, Australia and Canada in social mobility. 

The candidate might try to stir up his audience by flipping a familiar campaign trope: America is indeed No. 1, he might declare — in locking its citizens up, with an incarceration rate far higher than that of the likes of Russia, Cuba, Iran or China; in obesity, easily outweighing second-place Mexico and with nearly 10 times the rate of Japan; in energy use per person, with double the consumption of prosperous Germany.

Americans demand constant reassurance that their country, their achievements and their values are extraordinary.  .  .  .  .  .  But during a presidential campaign, it can be deeply dysfunctional, ensuring that many major issues are barely discussed. Problems that cannot be candidly described and vigorously debated are unlikely to be addressed seriously. In a country where citizens think of themselves as practical problem-solvers and realists, this aversion to bad news is a surprising feature of the democratic process.

American exceptionalism has recently been championed by conservatives, who accuse President Obama of paying the notion insufficient respect. But the self-censorship it produces in politicians is bipartisan  .  .  .   Both parties would rather avert their eyes from such difficult challenges — because we, the people, would rather avert our eyes.

“European politicians exercise much greater freedom to address bluntly the uglier social problems,” says Deborah Lea Madsen, professor of American studies at the University of Geneva. An American politician who speaks too candidly about the country’s faults, she went on to say, risks being labeled with that most devastating of epithets: un-American. 

Of course, the reason talking directly about serious American problems is risky is that most voters don’t like it. Mark Rice, who teaches American studies at St. John Fisher College in Rochester, N.Y., said students often arrived at his classes steeped in the notion that the United States excelled at everything. .  .  .  .  “Sure, we’re No. 1 in gross domestic product and military expenditures,” Mr. Rice says. “But on a lot of measures of quality of life, the U.S. ranking is far lower. I try to be as accurate as I can and I avoid editorializing. I try to complicate their thinking.” 

Sometimes the most patriotic thing one can do is to speak the truth and expose lies and inconvenient realities.  Sadly, most in the GOP prefer to remain cheer leaders supporting a myth rather than face problems and formulate a solution.  Currently, Mitt Romney is telling every audience he faces what he thinks they want to hear.  That may be popular with the ignorant and uninformed, but it does nothing to fix the nation's problems.  Indeed, one could argue that it is ultimately the cheer leaders who are the most "un-American" because they are leading the nation to more misfortune and a declining position in the world long term.