Forecasting trends in economics and politics has been a difficult business. It’s easier to be wrong than right, and it is almost impossible to foresee changes that may interrupt extrapolated trends. Nonetheless, persistent trends for periods of decades have staying power that allows for reasonable predictions. And I fear for the future of the United States.
The economic and political trends are converging, and the result has been, and I believe will continue to be, the accumulation of wealth by a privileged few at the expense of the rest of the country. The wealth does not consist only of money, but property including both commercial and private property. The United States is becoming the contemporary equivalent of “Pottersville” from the movie “It’s a Wonderful Life.” The proverbial richest man in town, in every town, owns all of the property and receives a significant portion of the revenue from all of the businesses. We live in a Rental Nation.
Consider that most Americans rent the places where they live. The ones that claim “home ownership” are, in fact, paying money for decades to the actual owners of their property, and at best they may hope to have their houses paid for shortly before they die. Most Americans never come close to actually owning a home because they move. Selling a house and buying another house rarely produces an equal exchange of equity, and in the current market equity has become almost obsolete. The housing bubble has burst, and the result is that there is rarely individual profit from the sale of a house whether that was the goal of the original purchase or not.
The same applies to commercial property to a large extent. Many small businesses rent, and even businesses that build their own properties have to borrow money which results in a lien on their property. The net result is that a bank in effect owns the property. Mr. Potter. Actual ownership has become an illusion; an unreachable goal for the majority of the country.
Even for those that own their houses outright, they are obligated to pay property taxes. When they are unable to meet their obligations, they may lose their homes by foreclosure. The process by which these homes are then sold favors those with the capital to pay for the homes. Aka the wealthy.
In this and many other ways, government has become the instrument by which the wealthy accumulate more wealth. Taxing policies, eminent domain, laws and courts that favor the wealthy, and recent changes in bankruptcy laws have tilted the balance in favor of the wealthy. The net effect of these policies has been the shifting of wealth from the lower and middle class to the very upper class.
The role of government in this transfer of wealth cannot be overemphasized. Corporate donations do not come without strings, implicit or explicit. A governmental philosophy that adopts the attitude of “What’s good for business is good for the country” fits handily with fulfilling obligations to corporate donors for reelection campaign donations, even at the expense of unions, employees, the poor and the elderly.
An unseemly side effect of government favoring the wealthy has been the efforts to disenfranchise the vote of those who do not conform to this philosophy and thus cement the power base of the wealthy. Recent efforts in Florida and Kansas in particular (and to a lesser extent in many other states) have sought to eliminate voter drives by requiring inordinate amounts of documentation including “long form birth certificates” or passports. Requirements that stipulate a person must be a resident for an increasingly lengthy amount of time favor the “landed gentry” and make it virtually impossible for college students, people that tend to move in response to economic opportunities and the poor to vote. Gerrymandering seeks to make the opposing party’s votes irrelevant.
A recent law in Illinois that seeks to “track every dollar in political donations” has created onerous requirements for documentation that penalize small voter drives inordinately, including, for example, a $50.00 penalty for every donation form not turned in within 48 hours of collection. Paradoxically, the Supreme Court’s decision in Citizens United allows corporate and wealthy donors to donate anonymously in unlimited amounts. It is unfortunate that advertisements have the ability to lead people to act against their own self-interest.
The effect of these measures cumulatively can be seen in the disparity of wealth and income between the upper class and the middle and lower class.
(Graphics from Mother Jones)
The final insult has been the centralization of government power and wealth followed by privatization or the attempt at privatization. Fannie Mae and Freddy Mac, private insurance companies administering Medicare and Medicaid, private contractors fulfilling military roles (as both logistical and fighting forces), and the attempt to privatize Social Security have had the effect (or attempted effect) of shifting government money into the hands of the wealthy. In Michigan, the state government has taken the rather extreme measure of abolishing local governments that have been less than successful and replacing them with private contractors that have taxing authority and no accountability to the people they will govern. Public resources there can be divided among private contractors for private developments (c.f. Benton Harbor). School voucher programs divert public funds collected for public schools to private schools.
The public has been rightfully concerned about bailouts of companies that are deemed “too big to fail.” Public funds have been shuffled into private companies by the billions with little or no accountability. Subsidies for highly profitable businesses accomplish the same thing.
In this blog, I hope to detail both the specific methods that are being used to transform this country and the vision of America that will be the outcome of this transformation. Regrettably, it is a vision that I could have dreamt in my worst nightmares.
