Ted McLaughlin : Class Conflict and the Disappearance of the Middle Class

Class conflict rises
as middle class disappears

The growing inequality of wealth and income in this country has reached a point where it is now causing a conflict between the rich (the 1%) and the vast majority of Americans.

By Ted McLaughlin / The Rag Blog / January 16, 2012

The graphic above (from Think Progress) shows what has been happening to the American middle class in the last 40 years. To put it bluntly, it is disappearing. While the rich continue to get much richer (with their income growing by over 240% since 1980), the loss of millions of jobs and the stagnant non-growth of wages for most Americans has shrunk the middle class and thrown many more Americans into working class status (if they're lucky) or even worse, into abject poverty.

The Republican "trickle-down" economic policies, instituted by Ronald Reagan and accelerated by George W. Bush, deregulated financial institutions and encouraged Wall Street to play dangerous games with investor funds -- culminating in the loss of trillions of dollars, many millions of jobs, and the start of the most serious recession since the Great Depression. In addition, these same politicians encouraged corporations to outsource millions more American jobs by rewarding them with tax breaks.

The idea was that when the rich and corporations had a lot of money they would use that money to create jobs and the growing wealth would be shared by everyone. It didn't work, because the wealthy aren't the real job creators -- no matter how much money they have. This is clearly illustrated by our current situation -- where the rich have a larger share of the country's wealth and income since before the Great Depression and American corporations are sitting on trillions of dollars in cash. And yet only a pitiful handful of jobs are being created.

There is only one thing that creates jobs -- demand for goods and services. When the working and middle classes have money to spend demand is created, and jobs are created to meet that demand -- and all classes in society benefit (including the rich). But Republican policies have taken money from the working and middle classes and given it to the rich. Since the mass of our society no longer has much money to spend, demand is depressed and the recession continues with little or no job creation.

The chairman of the President's Council of Economic Advisors, Alan Krueger, says the shift in income over the last three decades is the equivalent of moving $1.1 trillion from the 99% to the 1% every single year of those three decades. Is it any wonder that the middle class is disappearing, and we look more like a banana republic every day?

Class distinctions were not important when our economy was working for everyone. But in this current economy, where the rich get richer and everyone else becomes poorer, class is again becoming an issue. It's become an issue because the gap between the "haves" and "have-nots" is huge, and growing larger all the time.

The Republicans and the 1% call this "class warfare," but the truth is that the class war has been going on for the last 30 years -- and it has been waged by the rich against the rest of America. But Americans are finally waking to realize what has been done to them over the last three decades by the rich (and their Republican lackeys).

A recent survey by the Pew Research Center shows that a full two thirds of the population (66%) now believe there are "strong" or "very strong" class conflicts between the rich and the poor. That's a jump of 19% over just two years ago, in 2009, when only 47% believed that. And this increased belief in this strong class conflict cuts across all ethnic, political, income, age, and education demographics. In the following list, I give the current percentage who believe this (followed by the 2009 percentage in parentheses):

Total population...............66% (47%)

Whites...............65% (43%)
African-Americans...............74% (66%)
Hispanics...............61% (55%)

Republicans...............55% (38%)
Democrats...............73% (55%)
Independents...............68% (45%)

Less than $20k...............64% (47%)
$20k to $40k...............66% (46%)
$40k to $75k...............71% (47%)
Over $75k...............67% (49%)

Age 18 to 34...............71% (54%)
Age 35 to 49...............64% (48%)
Age 50 to 64...............67% (45%)
Over age 65...............55% (36%)

College grad...............66% (48%)
Some college...............70% (50%)
High school or less...............64% (44%)

The growing inequality of wealth and income in this country has reached a point where it is now causing a conflict between the rich (the 1%) and the vast majority of Americans. And it has also caused an erosion of the American dream.

Many no longer believe the old canard that anyone can get rich in America because America has a vibrant class mobility. About 72% of those who say there is a strong class conflict, also say the rich got that way either because they were born into it or because they knew the right people -- not because they earned it by working for it.

The rich, through their Republican cohorts, may have started the class war back in 1980, but the rest of America is waking up and starting to fight back. It will be a long and tough fight though, because the rich and the corporations own far too many members of Congress. But that fight can be won -- it must be won if democracy is to survive in America.

[Ted McLaughlin also posts at jobsanger. Read more articles by Ted McLaughlin on The Rag Blog.]

The Rag Blog

[+/-] Read More...

[+/-] Summary only...

Peter L. Myers : Pepper Spray Gazette (Numbers Don't Lie)

Lt. John Pike, who was photographed pepper spraying passive protesters at U.C. Davis, is shown here doing the deed in Andrew Wyeth's "Christina's World." Graphic by Brady Hall / Pepper Spraying Cop / Tumblr.
Pepper Spray Gazette:
Numbers don't lie!

By Peter L. Myers / The Rag Blog / December 20, 2011

2011 will be remembered for historic world-wide uprisings against despotism and against the astronomical, obscene growth of income and wealth inequality. It will also be remembered for assaults against unarmed protesters with tear gas and pepper spray and, in some nations, with live ammunition. In the U.S., the main achievement of the Occupy movements has been to put wealth/income disparity in the public consciousness:

• The 400 wealthiest Americans have a greater combined net worth than the bottom 150 million Americans.
• The top 1 percent of Americans possess more wealth than the entire bottom 90 percent.
• From 2002 to 2007, 65 percent of economic gains went to the richest 1 percent.
• Of the 100 highest paid chief executives in 2010, 25 took home more pay than their companies paid in federal corporate income tax.

-- Nicholas D. Kristof, “America’s Primal Scream,” The New York Times, October 15, 2011

• “Between 1979 and 2005 the inflation-adjusted income of families in the middle of the income distribution rose 21 percent... during the same period the income of the very rich, the top 100th of 1 percent of the income distribution, rose by 480 percent. No, that isn’t a misprint. In 2005 dollars, the average annual income of that group rose from $4.2 million to $24.3 million.”

-- Paul Krugman, “The Social Contract,” The New York Times, September 22, 2011

It is immoral that immense wealth is increasingly concentrated in a tiny layer while:

• One in five children in America is at risk for hunger and lives in poverty. (Share our Strength; MSNBC)
• A record number of Americans -- nearly one in two -- have fallen into poverty or are scraping by on earnings that classify them as low income. (MSNBC)

Second, the “1%” and their corporations are stifling political democracy:

• Corporate lobbyists control Congress. This is no leftist paranoia: Jack Abramoff boasted on NBC that he had literally controlled at least 100 Congressional offices by buying off the staff.
• Almost half of Congress members are millionaires themselves.
• Tax laws are written so that billionaires like Ronald Lauder have their wealth protected.
  -- David Kocieniewski, "But Nobody Pays That: A Family's Billions, Artfully Sheltered," The New York Times, November 27, 2011
• Corporate influence on campaign finance and the media stifles public discourse and the political process.

The chief demand of the Occupy movements is to create and expand political, social, and economic democracy and a society at the service of human needs. We will end Occupy when Wall Street stops occupying our Congress and ripping off the poor, working, and middle classes. Please join the worldwide movement for freedom and an end to despotism and injustice.

[Peter L. Myers is a semi-retired professor of anthropology and alcohol/drug studies, and a text author and editor. He was active in the early civil rights and student movements. Send comments and additions to nyprof@gmail.com.]

The Rag Blog

[+/-] Read More...

[+/-] Summary only...

Ted McLaughlin : The Occupy Movement is Changing the Conversation

It's changing the conversation:
The wealth gap and the Occupy Movement

By Ted McLaughlin / The Rag Blog / October 31, 2011

The image above brings home a very disturbing fact about the United States -- the vast inequality of wealth and income in the country. This inequality, which grows worse with each passing week -- since Congress has done nothing about it -- was the primary cause of this Great Recession (just like a previous and very similar gap caused the Great Depression).

But there is a big difference between the previous gap causing the Great Depression, and the current gap causing the Great Recession. The previous gap was caused by the Republican Party favoring the rich and the corporations. But when the Democrats got into power they changed the economic policies, put people back to work (using WPA and CCC), created the Social Security system, and gave the country new hope.

But things were different this time. After the Republicans went back to their old ways of favoring the rich and the corporations, causing the current economic mess and the loss of millions of jobs, the people again put the Democrats back in power in 2008. But this time nothing happened.

It turns out that the rich and corporations had gotten smarter -- instead of just buying the Republican politicians, they also bought a passel of Democratic politicians (the blue dogs). And the Republicans combined with the blue dogs were powerful enough to prevent any economic changes or job creation.

After watching the Congress muddle around for nearly three years without changing the failed "trickle-down" Republican policy or doing anything to create a substantial amount of jobs, it became obvious that too many members of Congress (of both parties) were controlled by the corporations and the rich and nothing was going to be done to help ordinary and hurting Americans.

In fact, the situation was being made worse by cuts to education and social programs while the rich continued to get unnecessary tax cuts and the corporations received unnecessary subsidies.

If any needed change was going to occur, it would have to start with the American people -- not the corporate-owned politicians in Congress. When this became obvious, it resulted in the birth of the Occupy Wall Street movement.

It may have started small with only a few hundred protesters in New York City, but it struck a chord with the American people and spread quickly to many other American cities -- first the large cities, and then in the smaller cities, and finally to cities around the world. It has now grown so large that it can no longer be ignored.

But can the movement cause real economic change in the United States? Probably not until and unless it grows even larger, but it has caused a couple of minor changes already -- and one of those could lead to much bigger changes down the road.

The first change is that it is starting to scare the big banks on Wall Street. At about the same time that the Occupy Wall Street movement started, one of the biggest banks (Bank of America) announced they would start charging their depositors a $5 a month fee for using their debit cards (accessing their own money). Several other of the giant Wall Street banks indicated they would do the same.

But the American public, led by the Occupy Wall Street protesters, gave voice to their anger over this latest insult from the greed-mongers of Wall Street (whose illegal actions triggered the recession).

Many people threatened to pull their money out of the giant banks and put it into local banks and credit unions. There was even a day set aside, November 5, to do this en masse. Now the big banks are backing down. J.P. MorganChase, U.S. Bancorp, Citigroup, PNC Financial, KeyCorp, and other banks are now saying they will NOT follow Bank of America's lead in charging for use of a debit card. And frankly, it would not surprise me if Bank of America didn't reverse their decision soon.

But the Occupy Wall Street movement has caused an even more important change -- one that could lead to needed economic changes down the road. They have altered the national dialogue, especially on the nation's news media outlets. Last summer all the media wanted to talk about was the national debt, an issue that is far less important than job creation and income inequality. A review of the 24-hour news sources (MSNBC, CNN, Fox) in the last week of July showed the following mentions:

Debt...............7,583
Unemployment...............427
Unemployed...............75

But after a month of the Occupy Wall Street movement that has changed. A review of the same news sources during the week of October 10-16 showed the most popular word references had changed to:

Jobs...............2,738
Wall Street...............2,387
Occupy...............1,278
Unemployment...............506
Debt...............398
Unemployed...............194

This is good change. A problem cannot be solved until the public is discussing it as an important issue, and that is unlikely to happen until the issue is being covered by the media. The movement still needs to grow to be the catalyst for a real change in economic policy, and that can happen now because the nation is now paying attention and starting to discuss the real issues.

[Ted McLaughlin also posts at jobsanger. Read more articles by Ted McLaughlin on The Rag Blog.]

The Rag Blog

[+/-] Read More...

[+/-] Summary only...

Ted McLaughlin : Trickle-Down Depression

Trickle-down depression:
Productivity gains are no longer shared

By Ted McLaughlin / The Rag Blog / September 12, 2011

From the end of World War II through 1979 the gains in productivity in the United States were shared between workers and owners -- and both benefited as wages rose along with company profits. It was recognized that both capital and labor were important in maintaining a healthy company, and a healthy economy. But with the election of Ronald Reagan in 1980 a different economic theory was put into effect -- "trickle-down" economics.

Trickle-down economics was actually not a new theory. It was just a new name for an old economic theory -- unregulated capitalism. It was a return to the economic ideas of the 1920's and before. Workers were no longer rewarded for an increase in productivity. Instead, all of the gains from the increased productivity went to the owners. Once again the 19th century idea of economics took root, which said that capital was the only important thing and labor was little more than a necessary evil (which reduced profits).


As the chart above shows, this resulted in a stagnation of wages in this country. This stagnation was actually a reduction in wages, since the price of nearly everything has risen since 1980 making the buying power of the stagnant wages much less than it had been in 1979. But while the buying power of workers was falling, the profits of corporate owners (the richest 1%) were skyrocketing -- an increase of over 240% since 1980.

It was no longer considered good enough to make adequate, reasonable, or even very good profits. The profits had to be massive, and they were created by refusing to let workers share in the productivity gains.

Now one might wonder how the workers let this happen? Why didn't they just organize and strike for their fair share as they had done in the past? The answer is they couldn't -- because of two things. The first of these is the weakening of unions by the federal and state governments. This started in the Reagan administration (with the busting of the air traffic controllers' union) and continues to this day. State "right to work" laws (a misnomer for the right to bust unions) have also played their part in the weakening of unions.

The second powerful tool used by capitalists to keep workers from getting their share of productivity gains is outsourcing. If workers unionized and tried to strike (or threatened to strike), the corporate powers countered this with the threat to outsource the jobs to another country (where they could legally abuse workers with poverty-level wages and no benefits).


And this was no idle threat. They began to outsource American jobs and that outsourcing is increasing every year (encouraged by government subsidies and tax breaks to companies that outsource). As the chart above shows, it has now reached the point where American companies are creating more jobs in other countries than they create in the United States.

This hoarding of productivity has resulted in a vast inequality in wealth and income in this country. In 2007, the top 1% of Americans owned about 34% of the nation's wealth, and the top 10 percent controlled more than 70% of the wealth. Meanwhile, the bottom 50% of the population had only 2.5% of the nation's wealth. And since 2007 this inequal distribution of wealth has gotten much worse.

There was only one place this unregulated capitalism could ultimately lead to -- the same place it lead to the last time it was tried. The Great Depression. This time it has led to what is currently being called the Great Recession (which is actually a second Great Depression). It seems that the American people and their leaders have an innate inability to learn from history, causing us to repeat our mistakes -- even the bad ones.

[Ted McLaughlin also posts at jobsanger. Read more articles by Ted McLaughlin on The Rag Blog.]

The Rag Blog

[+/-] Read More...

[+/-] Summary only...

Ted McLaughlin : The 'Free Market' Myth and the Suicide of Capitalism

Political cartoon by Carol Simpson / Cartoon Work.
The 'free market' myth and the
suicide of the capitalist system

In a capitalist society such as ours the wealth will be redistributed to the richest people unless there are some regulations to prevent that.

By Ted McLaughlin / The Rag Blog / August 23, 2011

We hear a lot today about free trade and free enterprise. Those are today's code words for unregulated capitalism -- the idea that capitalism can work for the benefit of everyone in a society as long as it is not hindered by government regulations. The proponents of this idea say that the more money the capitalists make, the more jobs they will create and the better off everyone in the society will be.

You may recognize this as the Republican "trickle-down" theory.

These modern Republicans may be surprised to learn that their boogeyman, Karl Marx was in favor of "free trade." Look at this quote from Marx:

The free trade system is destructive. It breaks up old nationalities and pushes the antagonism of the proletariat and the bourgeoisie to the extreme point. In a word, the free trade system hastens the social revolution. It is in this revolutionary sense alone, gentlemen, that I vote in favor of free trade.

Marx was in favor of free trade, or unregulated capitalism, because he knew that such a system was sowing the seeds of its own destruction. An unregulated capitalism would inevitably result in the death of capitalism (by concentrating too much of the total wealth in the hands of a few people which would kill demand).

The rich and the corporations (today's capitalists) have let their greed for accumulating ever larger pools of money blind them to reality (if they ever understood it in the first place). And that reality is that capitalists do not create jobs. Demand for products and services is what creates jobs. Capitalists simply exploit that demand to make money (and they have to put people to work in order to exploit that demand). But when the demand disappears, so do the jobs.

Now you may be asking yourself at this point: If an unregulated capitalism is suicidal then how has our system survived this long? The answer is regulation. When our system has started to get too out of whack, we have instituted measures to regulate or control the excesses of capitalism -- measures designed to redistribute some of the income and wealth away from the rich and to the others in our society.

I know that the term "redistribution of wealth" has been demonized in this country, but that is ridiculous because wealth is always being redistributed in all societies. In a capitalist society such as ours, the wealth will be redistributed to the richest people unless there are some regulations to prevent that. These regulations will spread the distribution of wealth and income throughout the society. This is healthy, because a more equal distribution of income creates demand as people use that wealth and income to buy goods and services (and this allows capitalists to make money and workers to find jobs).

We have used various means to redistribute the income more fairly in this country. We created a progressive income tax (where the more money a person makes the higher tax rate they pay), we created and protected unions (which provided workers with decent wages and better benefits), we created an array of social service programs (to protect children, the elderly, the poor, and those with disadvantages), and we imposed regulations on the business practices of Wall Street and the corporations. These things helped to keep our capitalist system from getting out of control and choking to death on its own success.

But the Republicans have never accepted that capitalism needs regulating. They still believe that "trickle-down" (or Voodoo) economics will work (in spite of its repeated failures). With the election of Ronald Reagan in 1980, they began to tear down the safeguards that had been installed in our society. They started to eliminate business regulations, strip unions of their power, dismantle social programs, and lower tax rates for the rich. This process was accelerated in the administration of George W. Bush.

The result was predictable. Far too much of the nation's wealth and income became concentrated in the hands of only a few people (about 1% of the population controls 40% of the wealth and income currently). While the income of the rich grew astronomically, the income of
workers was stagnant (and their buying power dropped substantially). This resulted in a drop in demand, which resulted in lay-offs, which killed demand even further, causing more layoffs -- and this spiraled the country down into a serious recession.

And what do the Republicans think the solution to this jobless recession is? They want to cut social programs, cut taxes for the rich, eliminate unions, and eliminate regulations on businesses. In other words they want to do more of the same things that caused this economic mess in the first place. They seem to be incapable of learning from either experience or history.

They claim they are being fiscally responsible. They aren't. What they are really doing is giving our capitalist system enough rope to hang itself -- an economic suicide that could unfortunately also kill our economy (and maybe even our democracy).

[Ted McLaughlin also posts at jobsanger. Read more articles by Ted McLaughlin on The Rag Blog.]

The Rag Blog

[+/-] Read More...

[+/-] Summary only...

Lamar W. Hankins : Beating the Bullies of the Wealthy Class

Schoolyard Bully. Photo by Igor Dutina /New York Times.
Defeating the political and economic
bullies that are destroying America

When Barack Obama was elected president, many of us thought that here, finally was a real live Superman, who would save us from the bullying behavior of the wealthy class.

By Lamar W. Hankins / The Rag Blog / August 8, 2011

Let me tell you a fictionalized story about true events in my life.

When I was growing up, there was a disagreeable kid in my neighborhood. I’ll call him Al. As some of us walked to school each day, he would sneak up behind us and grab our lunch, look in it, take what he wanted, and give the sack or lunch box back, leaving us with whatever he didn’t want.

At school recess, Al would often get a kid alone and demand some money for a soft drink or a snack. During lunch, Al would walk by and grab whatever he wanted off another kid’s plate.

He was careful to make sure that teachers monitoring the lunch room were looking the other way. If a kid told a teacher what Al had done, there would be the usual denials from Al, and the teacher might give both kids a warning, and Al would skate by. But any kid who told on Al had better find a new way to walk home from school that day because Al would be looking for the tattletale to rough him up or put him on the ground and bend his arm until he squealed in pain.

Playing with Al was asking for trouble, or at least was no fun. A game of baseball didn’t follow the usual rules. We had to follow Al’s rules, which changed to assure that he would win. If his own rules wouldn’t help him, Al would just lie about whether a ball was foul or a pitch was a strike or how many strikes he had taken when he batted.

Al intimidated, frightened, and dominated the others kids in our neighborhood. Parents were of no help. The few efforts made to talk with Al’s parents did no good, and only made Al madder at the kid who had squealed to his parents. The next day or the next week was a time of torment for the offending kid who had dared to tell his parents about Al’s behavior.

And Al had his group of followers, who were only too glad to do whatever Al asked, and participate in his intimidating the rest of us. What we needed was someone to stand up to Al and his pals, but the usual sources of help -- teachers and parents -- weren’t of much use, even when they tried. Oh, how we wished for Superman to sweep down and take care of Al and his pals. But, of course, Superman was fiction.

Al and his pals were bullies, ruffians, tyrants, and terrorists. The behavior of Al and his pals was not far different from the behavior of the corporate and financial classes and their willing minions and friends on Capitol Hill. When Barack Obama was elected president, many of us thought that here, finally was a real live Superman, who would save us from the bullying behavior of the wealthy class.

For those of us who fought in the civil rights, and women’s, and anti-war, and gay rights, and disability rights movements of the past half century, there was the double pleasure of not only getting someone to right the wrongs we had been suffering, but of having an African-American be that person. What fools we were.

Barack Obama was not a political incarnation of Martin Luther King. He saw and sees the world much differently than King did. King opposed war as a solution to problems. Obama embraced an expansion of the Afghanistan war. King would have abhorred torture and never participated in it. Obama promised to close that torture center called Guantanamo, but he has not done so, and he has opened up new ones in Afghanistan and allowed others to continue with both direct and indirect American involvement, mainly in the Middle East.

King stood with the oppressed, whether they were garbage workers in Memphis, poor whites in Appalachia, Native Americans, or farm workers throughout our country. He never curried favor with the wealthy elites. He had a habit of pointing out the injustices they fomented. Obama has done little of this. King knew that change comes only with conflict. Obama believes that there can be a post-partisan America, which is as foolish a notion as my belief that his administration would usher in an era devoted to the needs of average Americans.

If Obama were to play Superman against the wealthy elite bullies of Wall Street, he would not hire as his advisers some of those same people. He would spend money to reform the oppressive mortgages that are sapping the lifeblood from middle-American families rather than rescue the financial institutions that made those unjustified mortgage loans knowing that they would be bailed out when they failed, as they did spectacularly.

Some of us saw Obama as a modern-day Franklin Delano Roosevelt who would take dramatic steps to put Americans back to work on public works projects much as FDR did through the Civilian Conservation Corps and the Works Progress Administration. But Obama is no FDR any more than he is an MLK.

It is impossible to imagine that President Obama would tell the American people the truth about the financial sector as FDR did in 1933 when he wrote, “The real truth of the matter is, as you and I know, that a financial element in the large centers has owned the government of the U.S. since the days of Andrew Jackson.”

Today, economic inequality in this nation is as bad as it’s ever been. The top 20% own 85% of the wealth, leaving only 15% of the wealth for the other 260 million Americans. In fact, the top 1% own 43% of the wealth. And the gap between the top one-tenth of 1% and the rest of us has not been as great since the Great Depression.

Given the naked economic inequality now apparent in our country, it should not be too much to expect that a President Obama would be as forthright about our circumstances as was FDR in 1936:

For too many of us the political equality we once had won was meaningless in the face of economic inequality. A small group had concentrated into their own hands an almost complete control over other people's property, other people's money, other people's labor -- other people's lives. For too many of us life was no longer free; liberty no longer real; men could no longer follow the pursuit of happiness... Against economic tyranny such as this, the American citizen could appeal only to the organized power of government. The collapse of 1929 showed up the despotism for what it was...

These economic royalists complain that we seek to overthrow the institutions of America. What they really complain of is that we seek to take away their power. Our allegiance to American institutions requires the overthrow of this kind of power. In vain they seek to hide behind the flag and the Constitution. In their blindness they forget what the flag and the Constitution stand for. Now, as always, they stand for democracy, not tyranny; for freedom, not subjection; and against a dictatorship by mob rule and the over-privileged alike.

Roosevelt explained the politics of what he sought for the country in this way:

The true conservative seeks to protect the system of private property and free enterprise by correcting such injustices and inequalities as arise from it. The most serious threat to our institutions comes from those who refuse to face the need for change. Liberalism becomes the protection for the far-sighted conservative...Wise and prudent men -- intelligent conservatives -- have long known that in a changing world worthy institutions can be conserved only by adjusting them to the changing time... I am that kind of conservative because I am that kind of liberal.

President Obama has failed to explain to the American people that the wealthy class has become the bully terrorizing the rest of us. His failure is due in part to his close relationship with those bullies. He has already raised nearly $100 million for his re-election campaign and is expected to amass more than $1 billion for his re-election effort.

Such money does not come from the bottom 80% of Americans. It comes from the very wealthy, the same ones who have gamed the American economic system for their own benefit at the expense of everyone else.

But there is another thing I have learned about bullies since I was a school kid. Bullies don’t like to be exposed and confronted. If there is any hope for us in the future, it will come only from massive exposure of the way the economic elites have gained control of this country, and how they have done it, followed by a confrontation they cannot avoid.

They have bought our politicians, who are willing to do their bidding. Perhaps three-fourths of the Congress, as well as the president, can be expected to help the wealthy elites maintain their stranglehold on our economic freedoms. Only if we stop being passive and apathetic about politics, focused primarily on consumerism and entertainment, can we become organized sufficiently to defeat the interests of the wealthy elites.

The American people need to understand why the real unemployment level is nearly as bad as it was in the Great Depression, and why our government manipulates the statistics to make us think otherwise. The people need to understand that the true “nanny state” is not the one that gives a pittance in unemployment benefits and Medicaid to those who need the help, but the one that bails out the banks and other financial institutions that have become “too big to fail,” while it leaves everyone else scratching for the scraps that may have fallen from the moneybags filled from the public trough by the wealthy.

Even if we don’t have a president or more than a handful of politicians who will tell us the truth about how this country has come to be controlled by about one-tenth of 1% of the most wealthy, the American people are still capable of understanding what Adam Smith realized 235 years ago -- that concentration of economic power leads to the concentration of political power.

The only way around this circumstance is for the people to fight the elites, understand the dynamics of the economic-political system, and vote into office politicians who will reverse this economic concentration of power. It’s time to identify the bullies, take names, expose their game plan, and beat organized money with organized people.

There are many groups aiming to organize people to take back the country from the wealthy elites. They include groups of organized workers, business leaders, veterans, students, those from the faith community, civil rights workers, women's rights advocates, immigrant rights defenders, LGBT supporters, environmentalists, academics, artists, celebrities, and other community activists.

Do an internet search for an affinity group that appeals to you and start working. If we challenge the bullies together, they can be defeated.

[Lamar W. Hankins, a former San Marcos, Texas, city attorney, is also a columnist for the San Marcos Mercury. This article © Freethought San Marcos, Lamar W. Hankins. Read more articles by Lamar W. Hankins on The Rag Blog.]

The Rag Blog

[+/-] Read More...

[+/-] Summary only...

FILM / William Michael Hanks : Jamie Johnson's 'The One Percent'

Documentary film:
Jamie Johnson's The One Percent is a
revealing statement about wealth in America

By William Michael Hanks / The Rag Blog / April 28, 2011

Jamie Johnson has a conscience if he can keep it. He is heir to one of the largest fortunes in America: Johnson & Johnson. In The One Percent, his second documentary after Born Rich, he combines his interest in economic inequality in America with a skill and talent for filmmaking.

The film is worth seeing. It is a fresh and honest statement about the disparity of wealth in America. The exclusive access the filmmaker's family name gives him to the very wealthy made some of the surprisingly revealing interviews possible.

Jamie points out that:

Today in America the disparity between the haves and have-nots is greater than it's ever been. Now the top one percent of Americans like my family and me own 40 percent of all the country’s wealth and we share an aggregate net worth that is greater than the bottom 90 percent of individuals combined.

His family, as do most very wealthy families, has a wealth counselor who meets with the whole family regularly. You have to see this guy. He comes off like a mean-spirited hired gun -- like the Jack Palance character in Shane. The deference which Jamie's father shows this bully is pathetic. But then, every year the story is always the same -- the wealth of the family continues to grow and who can argue with success?

Jamie uses his family name to enroll in one of the most exclusive wealth conferences in America -- The Lido. Jamie remarks to the conference director: "There are people that are looking for funding for their projects who would absolutely kill to get into this meeting." The Director, Gregg Kushner, responds "That's right, absolutely, and we make sure they don't get to get in."

It is this "circle the wagons" -- the "us and them" mentality -- that pervades the attitudes of the very rich. There is a universal refusal to even broach the subject of disparity of wealth. The candid sequences with the very rich in the film reveal this in ways that media coverage and mere commentary cannot.

The mantra of the rich as given by Gregg Kushner, the Lido Conference director, is as follows

There is much greater good done by the people with the wealth in creating jobs, creating business opportunities, and in philanthropy than otherwise, and I would say it makes more sense to me to encourage business ownership, to encourage the wealthy to generate that wealth so that wealth can then be shared rather than take it from individuals to then redistribute it through social policy and transfer policies of medicare and social security or whatever. I hope that didn't come out sounding crass.

Well, Gregg, it did.

Of course the fallacies -- some would say lies -- are that the facts belie the myth that wealth is shared. How much sharing is being done if one percent owns 40 percent of the wealth? And how is having a person over the barrel, so he has to accept slave wages, not taking it from individuals? How does charging 600 percent interest on a pay day loan not taking it from individuals?

Apparently taking from some individuals is OK -- just not from the wealthy. As Dickens said, "The poor have no right to their good fortune." The other lie is that rather than being "redistribution" or "transfer" policies, social security and medicare are self-funded programs that are supported by those who participate.

But it is this hedge of false mythology that is the personal cover of most of those who are represented at the conference. The justifications are so weak that most of those who are among the privileged few react very nearly with violence when these questions are even raised.

Jamie runs into these attitudes repeatedly in his interviews. The interview with Milton Friedman is something to see. The duplicity and bullying are astounding. I would like to know who paid for this man's Nobel Prize. It could not have come from an original contribution to economics; the previous author Attila the Hun should have gotten the prize. He reveals himself to be merely a thug who works as economic muscle for the wealthy and their minions.

These reactions are typical in most of Jamie's interviews with the very wealthy, but there are some who seem not to be able to silence their conscience so easily. His interviews with Warren Buffet's granddaughter led Buffet to disown her and his interview with the the Oscar Mayer heir revealed his struggle with economic equity which culminated with giving away his money.

It's not even that huge profits are a result of hard work and innovation anymore, or real service to the market; more and more, huge profits are the result of favorable laws, regulations, and subsidies. Laws bought and paid for with campaign contributions.

In one interview, Kevin Philips, a former Nixon aide and author, said "It's been the case for the last 25 years in the United States that the amount of money flowing into the system for political contributions has been a major shaper of who gets what within the economy." The film shows specific examples of how corporate and individual contributions lead directly to multi-million dollar subsidies for donors.

The most revealing moments of the film are the times when the very wealthy are being interviewed and show a complete lack of self reflection -- their mythology, tired and aging as it may be, seems the touchstone of justification for their control of such vast assets. It was always the same song: vast wealth generated all good in society and any form of taxation is socialism.

Most of those interviewed just shut up and refused to comment when the subject of the film was revealed. The fear of addressing the obvious was palpable.

The saddest thing about the film is the portrait of Jamie's father. When he was Jamie's age, he had made a film about poverty and apartheid in South Africa. He was so criticized by his family that it appears he never quite got over it. He, one of the wealthiest men in America, was reduced to being a fearful, ineffectual, and indecisive man with faith no more in anything but the bloodless approval of his financial adviser, his croquet games with rich friends at the country club, and an ice cold martini, or two.

But the unseen tragedy that the film holds like a secret box within a box is that Jamie himself will end up like his father. The wolves encircling him -- biting, punishing, threatening to alienate him from all he has known in his life. Reminding him of the ultimate price -- exclusion, poverty, and isolation. Surely he will come to his senses, surely he will come back into the fold, a chastened member of the club.

But then again, Jamie has a conscience, if he can keep it.

[William Michael Hanks lived at the infamous Austin Ghetto and worked with the original Rag gang in the Sixties. He has written, produced, and directed film and television productions for the National Aeronautics and Space Administration, The U. S. Information Agency, and for Public Broadcasting. His documentary film The Apollo File won a Gold Medal at the Festival of the Americas. Mike lives in Nacagdoches, Texas. Read more articles by Mike Hanks on The Rag Blog.]

• The One Percent home and Trailer
• The One Percent on YouTube

The Rag Blog

[+/-] Read More...

[+/-] Summary only...

David Van Os : The Divine Right of Greed

Political cartoon by Deng Coy Miel, Singapore.
(On being mad as hell...)
The divine right of greed

By David Van Os / The Rag Blog / April 20, 2011

Most of the income of the super-rich is in capital gains such as stock transactions. Capital gains are taxed at a 15% rate, while most wages and salaries are taxed at rates of at least 30%.

Does it make you feel good to know that while you struggle to pay your taxes the super-rich make out like bandits by paying only half of your tax rate or less? Does it make you feel good to know that most of them don’t even pay that minimal rate, but instead spend large sums on accountants and lawyers to find all the loopholes that you can’t afford to pay $300-per-hour accountants and lawyers to find for you?

Does it make you feel good to know that those who can afford the most pay the least and those who can afford the least pay the most?

Would it make you feel even better to know that, as reported by Nobel Prize winning economist Joseph Stiglitz (“Of the 1%, by the 1%, and for the 1%”, Vanity Fair, May 2011), the wealthiest 1% of Americans now rake in 28% of the income and own 40% of the wealth and property?

America is not broke. There are enormous amounts of money and resources in our society. But the super-rich are hoarding their fortunes, and government tax laws written by the 1% for the 1% have institutionalized a divine right of greed.

Bank of America was gifted with 45 billion dollars in taxpayer funded bailout money in 2009. Did Bank of America learn any lessons? You be the judge. Bank of America paid no taxes for tax year 2009 because it reported a net loss on its tax return. In 2010 its CEO received compensation worth 10.1 million dollars, including bonuses. Does a corporation that has that kind of money available to pay to one employee sound like a company that is strapped for cash?

Medieval monks taught that greed is a deadly sin. For 30 years, since the false saint Ronald preached the false doctrine that greed is a glorious virtue, the America of checks and balances that our American founders envisioned has been sinking under the weight of greed.

I don’t buy the false libertarian crap that idealizes greed as a high manifestation of American freedom. Freedom to avoid sharing responsibility for the common good is not an American ideal. Among the very purposes of the founding of the government of the United States of America, as set forth in the Preamble to the Constitution, are to form a more perfect Union and to promote the general Welfare. “Form a more perfect Union” means uniting for the common good. “Promote the general Welfare” means we are all in this together.

Stiglitz writes similarly in the Vanity Fair article, “Of all the costs imposed on our society by the top 1%, perhaps the greatest is this: the erosion of our sense of identity, in which fair play, equality of opportunity, and a sense of community are so important.”

Greed may be a vice that we cannot hope to eradicate from the human condition. However, that does not mean that as a society we are helpless before the ravaging effects of greed. Just as through our governments we seek to enact and enforce just laws to protect our society from violence, we also have the power and the right to enact and enforce just laws to hold greed in check.

At the top of the political tower, the corporate-political complex of today exists primarily to protect the false divine right of greed. Most of the members of the U.S. Congress are part of the 1% and they do whatever it takes to protect the power, wealth, greed, and hoarding of the 1%, while throwing enough bones to the 99% to keep us fooled and pacified.

If you aren’t mad as hell about it, you ought to be.

[David Van Os is a populist Texas democrat and a civil rights attorney in San Antonio. He is a former candidate for Attorney General of Texas and for the Texas Supreme Court. To receive his Notes of a Texas Patriot -- published whenever he gets the urge -- contact him at david@texas-patriot.com.]

The Rag Blog

[+/-] Read More...

[+/-] Summary only...

Jim Turpin : Is the United States a 'Banana Republic'?

Image from polisci.wisc.edu.
Lookout, O. Henry!
How did the United States
become a 'banana republic'?

By Jim Turpin / The Rag Blog / February 1, 2011

ba•nan•a re•pub•lic (noun) A small country that is economically dependent on a single export commodity or on outside help, and is typically governed by a dictator or the armed forces.

“Banana republic” was first used by author William Sydney Porter (“O. Henry”) in Cabbages and Kings (1904) while residing in Honduras after hiding out for allegedly embezzling funds from the First National Bank of Austin in 1894.

“This is America, not a banana republic.” -- Vincent Bugliosi

Well... I hate to break it to the esteemed lawyer above, but the United States is a banana republic and here’s why:

• Unmitigated torture and detention of U.S. citizens & foreign nationals
• Extrajudicial assassinations of U.S. citizenry by strong man in charge
• Unlimited spying on citizenry & seizure of property
• Control of majority of economic resources by wealthy elites
• Massive indebtedness to foreign powers and funding war

Unmitigated torture and detention of US citizens & foreign nationals:

As part of the “War on Terror," the Obama administration continues the draconian national security “policies” of George W. Bush. These include indefinite detention at CIA “black sites” and at Guantanamo, “evidence” produced through torture, post acquittal “detention power," and military commissions or tribunals with severely limited “due process." This list barely touches the full complement of tools used by our government to flout the rule of law.

Key among these is the use of torture and detention for both U.S. citizens and foreign nationals. The abuses at Guantanamo and other “black sites” are well known: water boarding, sleep deprivation, stress positions, humiliation, and degradation. But what is not as well known is that this has happened to U.S. citizens and the “evidence” produced is admissible in military commissions.

In 2006, the Congress passed the Military Commissions Act (MCA)
which allows

procedures deviating from the traditional rules of the Uniform Code of Military Justice (UCMJ). Among other shortcomings, the MCA rejects the right to a speedy trial, allows a trial to continue in the absence of the accused, delegates the procedure for appointing military judges to the discretion of the Secretary of Defense, allows for the introduction of coerced evidence at hearings, permits the introduction of hearsay and evidence obtained without a warrant, and denies the accused full access to exculpatory evidence.

Canadian Omar Khadr was 15 years old when picked up and accused by the U.S. government of planting roadside bombs and killing a U.S. soldier with a grenade in Afghanistan in 2002.

Defense lawyers want the military judge, Army Col. Patrick Parrish, to exclude any confessions Khadr made to U.S. interrogators following his capture, wounded and near dead, on grounds of either coercion or torture. Prosecutors seek to use statements Khadr made to his captors at age 15 and 16 at his upcoming trial...

Critics cast his trial as the first of a so-called "child soldier" in modern Western history. They argue that Khadr should have been given special treatment, including rehabilitation, and not shipped from Afghanistan to the prison camps where he was held for year as an alleged teen terrorist among adult "enemy combatants."

He still remains untried after nine years at Guantanamo and will likely never be tried or released.

U.S. citizen Jose Padilla was arrested in 2002 for providing “material support to terrorism” and for training in the use of radiologic weapons in the Afghanistan-Pakistan region in 2001 and early 2002. He was then deemed an “enemy combatant” and held in a military brig in South Carolina without notice to family or attorney. Padilla was held for five years and alleges torture including sensory and sleep deprivation, stress positions, and the administration of the hallucinogenic drugs LSD and PCP. Padilla was convicted in 2007 and is serving a 17-year sentence.


Extrajudicial assassinations of U.S. citizenry by strong man in charge

Though this program existed long before the Obama administration, the ordered assassinations of U.S. citizens by the executive branch due to an “unspecified threat” seems beyond the pale for most Americans and citizens of the world.

The ACLU recently stated:

It is alarming to hear that the Obama administration is asserting that the president can authorize the assassination of Americans abroad, even if they are far from any battlefield and may have never taken up arms against the U.S., but have only been deemed to constitute an unspecified "threat."

This is the most recent consequence of a troublingly overbroad interpretation of Congress's 2001 Authorization for the Use of Military Force. This sweeping interpretation envisions a war that knows no borders or definable time limits and targets an enemy that the government has refused to define in public. This policy is particularly troubling since it targets U.S. citizens, who retain their constitutional right to due process even when abroad.

Glenn Greenwald in Salon also noted that

I actually can't believe that there is even a "debate" over whether an American President -- without a shred of due process or oversight -- has the power to compile hit lists of American citizens whom he orders the CIA to kill far away from any battlefield. The notion that the President has such an unconstrained, unchecked power is such a blatant distortion of everything our political system is supposed to be -- such a pure embodiment of the very definition of tyrannical power -- that, no matter how many times I see it, it's still hard for me to believe there are people willing to expressly defend it.

The citizen in question is Anwar al-Awlaki, a U.S. citizen born in New Mexico in 1971 and a Muslim cleric accused of orchestrating terror attacks from Yemen. In December 2010 a federal judge dismissed a challenge to the Obama administration's targeted-killing program, meaning the U.S. can continue to go after a Yemeni-American cleric whom it blames for terrorist plots.

The case, brought by the father of cleric Anwar al-Awlaki, raised difficult questions about the breadth of U.S. executive power, but U.S. District Judge John Bates said he couldn't answer them as the father lacked legal standing to bring the case. The "serious issues regarding the merits of the alleged authorization of the targeted killing of a U.S. citizen overseas must await another day or another (non-judicial) forum."

Rep. Dennis Kucinich (D-OH) tried in August of 2010 to pass a bill that prohibits extrajudicial assassinations, but failed to get enough votes. The Congressman stated: “The U.S. government cannot act as judge, jury, and executioner."


Unlimited spying on citizenry and seizure of property

As a response to Richard Nixon’s propensity to spy on political and activist groups which blatantly violated the Fourth Amendment (unreasonable search and seizure), the Carter administration passed the Foreign Intelligence Surveillance Act (FISA) in 1978. The act was created to provide judicial and Congressional oversight of the government's covert surveillance activities of foreign entities and individuals in the United States, while maintaining the secrecy needed to protect national security.

It allowed surveillance, without court order, within the United States for up to one year unless the "surveillance will acquire the contents of any communication to which a United States person is a party." If a United States person is involved, judicial authorization was required within 72 hours after surveillance begins.

In the period 1979-2006 a total of 22,990 applications for warrants were made to the Court of which 22,985 were approved (sometimes with modifications; or with the splitting up, or combining together, of warrants for legal purposes), and only five were definitively rejected.

This means that only .02% of submitted governmental FISA requests were denied by the court.

Even with this governmental “rubber stamp” to spy on U.S. citizens, the Bush administration and its’ national security measures went beyond the confines of FISA authorization and allowed the National Security Administration (NSA) to track the international phone calls and e-mails of hundreds and possibly thousands of Americans without use of the court. The FISA Amendment Act of 2008 was passed (and fully supported by then Senator Obama) and as the ACLU pointed out,

...the law meant to “update” FISA instead gutted the original law by eviscerating the role of the judicial oversight in government surveillance. The law also gave sweeping immunity to the telecommunications companies that aided the Bush administration’s unconstitutional warrantless wiretapping program by handing over access to our communications without a warrant.

With the recent release of Wikileaks documents, seizure of property is now also the rule when U.S. citizens return from traveling abroad. Salon magazine recently discussed this very issue and the legal ramifications:

For those who regularly write and read about civil liberties abuses, it's sometimes easy to lose perspective of just how extreme and outrageous certain erosions are. One becomes inured to them, and even severe incursions start to seem ordinary.

Such was the case, at least for me, with Homeland Security's practice of detaining American citizens upon their re-entry into the country, and as part of that detention, literally seizing their electronic products -- laptops, cellphones, Blackberries and the like -- copying and storing the data, and keeping that property for months on end, sometimes never returning it.

Worse, all of this is done not only without a warrant, probable cause or any oversight, but even without reasonable suspicion that the person is involved in any crime. It's completely standard-less, arbitrary, and unconstrained. There's no law authorizing this power nor any judicial or Congressional body overseeing or regulating what DHS is doing.

Control of majority of economic resources by wealthy elites

Wealth inequality and plutocracy may now be at the highest point in U. S. history. Corporations are making huge profits and the recent passage of the tax bill in December heavily favors the top earning elite. With best ever fourth-quarter 2010 corporate profits from Apple ($.4.31 billion), Intel ($3.4 billion), along with many others including the financial institutions bailed out by tax payers including JP Morgan who

reported a 48 percent increase in profits over 2009 and a 47 percent increase for the fourth quarter of 2010 over the same period the previous year. JP Morgan netted a profit for the year of $17.4 billion, a figure equivalent to the gross domestic product of Bolivia

The plutocrats of this country are not just doing well, they are exceeding levels not seen since the wealth gap that was created right before the Great Depression.

In 1928, the top 0.01% of U.S. families averaged 892 times more income than families in the bottom 90%. By contrast, in 2006 the top 0.01 percent averaged 976 more income than America’s bottom 90 percent.

Inversely with wealth increasing, tax rates have plummeted for the rich. Taxpayers making more than $1 million in 1944 paid 65% of their total income in taxes. In 2005, those making $1 million faced a top marginal rate of 35% or 23% of their income in federal taxes.

Let’s not forget that the Obama administration, with a majority in both the House and Senate, caved to the Republican party in December 2010 by continuing the ruinous Bush tax cuts for the wealthy. He helped ramrod a tax cut for the uber-rich that added $900 billion to the over $14 trillion U.S. national debt. This was not well received by some Democrats, but passed anyway and was hailed as bipartisan cooperation.

Congratulations. Each man, woman and child in the U.S now owes around $45,000 to eliminate the national debt. Go ahead and add that to your mortgage, credit card, and college debt which exceeds annual disposal income by 122.5%. In other words, you are enslaved permanently to massive debt.

But who has done well in the last 15 years? Well, if you are a CEO, your pay has increased +298.2%, while production workers have had a +4.3% increase and federal workers have had their pay fall by -9.3%. But don’t worry, corporations have had a +106.7% profit increase since 1990. Go figure.


Massive indebtedness to foreign powers and funding war

You don’t have to be a math genius to figure out that huge tax cuts along with a massive increase in spending causes a huge national deficit and federal debt. The majority of U.S. debt is held by foreign countries via U.S. Treasury bonds. These bonds are held primarily by Asian countries (China, $907 billion, and Japan, $877 billion) but also by other foreign powers including the United Kingdom ($477 billion) and oil exporting countries ($214 billion).

This has caused concern that these controlling foreign entities may have not only economic but also political control of the United States policies with vast control of our national debt.

So where are your tax dollars going? 54% of federal tax dollars go to military spending (36% to current military operations to the tune of $965 billion and 18% or $484 billion for past military spending including vet benefits and interest on national debt borrowing). The government typically “cooks the books” and underestimates military spending by including trust funds (i.e. Social Security) and the expenses of past military spending as not distinguished from non-military spending.

It seems that one major export we have for the world is endless war. To date, the total cost of the Iraq and Afghanistan wars is $1.26 trillion. This obscene amount has been approved over and over again, by both Democrats and Republicans since 2001, including the $33 billion war supplemental in August 2010. This war is bought and paid for by both parties.

Nobel economic laureate Joseph E. Stiglitz predicted that by the time the U.S. leaves these two conflicts we will have spent over $3 trillion and we may well exceed this amount when factoring in the national debt, the current economic crisis and the rising cost of oil.

So the question remains… are we now the mythical “banana republic” Anchuria that O. Henry created in Cabbages and Kings?

At that time we had a treaty with about every foreign country except Belgium and that banana republic, Anchuria...

It seems to me we don’t even rate with Anchuria... or Belgium for that matter.

[Jim Turpin is a native Austinite and member of CodePink Austin. He also volunteers for the GI coffeehouse Under the Hood Café at Ft. Hood in Killeen, Texas.]

The Rag Blog

[+/-] Read More...

[+/-] Summary only...