|President Ronald Reagan|
Once upon a time, well just 40 years ago actually, if you worked hard all your life you'd probably come out better than you started. It wasn't just a line they fed to lure you here.
It was true -- you stood a good chance of making real progress with your life. In those days, which were your parents’ days, a more tightly regulated economy lifted all boats, not just the big yachts at the top.
There used to be a very strong middle class in America who were the envy of the world, and their unprecedented purchasing power drove the dynamo of the American century.
So what happened? Well, first the Ronald Reagan administration happened.
That era saw the mass changeover from productivity to finance, it saw America's rich find more effective ways to grow their own wealth. Instead of producing goods they switched over to playing the markets, private gain trumped public obligation, special interests trumped the common good.
Since Reagan's inauguration in 1980 we've now developed a financial inequality that's so extreme it's actually worse now than any time since the late 1920s (in the years just prior to the Great Depression).
But while ordinary people are struggling to get by our top corporations are enjoying the highest corporate profit margins in the history of this nation, combined with one of the highest unemployment rates in history.
Employers are also paying the lowest wages in history as a percent of the economy. According to an analysis by Moody’s Analytics this week, profitability in non-financial firms surged in recent quarters to fifteen percent, a level not seen since the late 1960's.
So President Obama was correct last week when he said our private sector is doing fine. There's simply no question about that. It's the best of times for the lucky few and the worst of times for the many.
Giving more tax breaks to corporations that are already stuffed with cash is not going to lead to change. It's the lack of demand that's really hammering our economy and impeding investment.
Some conservatives like to tell you that American jobs only exist because “wealth creators” create them. That's nonsense.
Jobs only exist because there are customers that can afford to buy products. But they can't do that if they don't have the cash.
If you're one of the many people who visited a store last week and hesitated to make a purchase whilst you calculated if you could afford it, you participated in a dangerous cycle. If you turned around and walked out things just got worse.
If instead you're one of those people who rarely have to calculate whether you can afford something, well good for you. The problem is there aren't enough of you to save the rest us from the tightening vice. The crumbs from your table aren't going to be enough.
Of course there are different realities in America. It's why I love livening in New York. It's a democratic city that affords you instructive glimpses into the gulf between rich and poor every time you walk a city block.
It's instructive to walk down to Tribeca, the real seat of the city's wealth now, where you can enter the Harry Potter alternate reality of the financial district. Doormen in white gloves will sweep you into the most expensive looking apartment buildings on the planet.
Upscale lifestyle facilities abound. Yachts bigger than small villages are anchored to the nearby Hudson with immediate access to leafy outdoor restaurants.
If there's a recession on, they haven't got the memo in Tribeca. They live, most of them, in that other America, in Mitt Romney's America, and it's still morning in that America. If you want the next four years to look like the last ten you should vote for him.
To clarify, I don't mind rich people. I don't think rich people are the problem individually. I think that the political party that panders exclusively to them and works against everyone else in the nation is the problem.
I’m not the only one who thinks this. For example David Stockman, Ronald Reagan's director of the Office of Management and Budget who wrote a prescient New York Times op-ed piece in 2010, agrees.
America's increasingly partisan politics is destroying not just the economy and capitalism, but the American dream he wrote. "If there were such a thing as Chapter 11 for politicians, the Republican push to extend the unaffordable Bush tax cuts would amount to a bankruptcy filing. The nation's public debt will soon reach $18 trillion,” he warned.
That kind of debt cries out for “austerity and sacrifice,” he wrote. Instead, Romney and the GOP insist that the nation's richest taxpayers should be spared even a three-percentage-point rate tax increase.
"Republicans used to believe that prosperity depended upon the regular balancing of accounts," Stockman wrote, "in government, in international trade, on the ledgers of central banks and in the financial affairs of private households and businesses too."
No longer. From 2002 to 2006 the top 1% of Americans received two-thirds of the gain in national income, while the bottom 90% got only 12%.
This growing wealth gap is not the market's fault. It's the fault of decades of bad economic Republican policy. It seems unfathomable that we are being asked to embrace it for yet another presidential cycle.