Posts Tagged ‘class’


The last time I brought up the issue, I was referring to mainstream economists’ presumption we would forever live in a Goldilocks economy: not too equal and not too unequal but just right.

But, as we know, the Goldilocks economy no longer exists (and hasn’t, for over three decades), as economic inequality has continued to grow.

Well, as Jeff Spross has discovered, the same principle applies to economic growth.

The presumption is, fast economic growth is a good thing. Everyone benefits from a larger economic pie. And slower-than-normal growth is something we should be worried about.

Not so fast. A dark and unpleasant truth is that many economic elites actually have a vested interest in anemic job growth and a slack labor market.

How so? As I explained to my students yesterday, faster economic growth means (usually) tightening labor markets and more worker bargaining power—and, as a result, higher wages. On one hand, those increasing wages mean more worker income and more mass consumption. But they also put the squeeze on profits, and the distributions of those profits to the rest of the economic elite.

To which Spross adds:

Finally, there’s a lifestyle issue at play. If the incomes of everyday workers go up, then elites’ real incomes must go down. The labor they’re buying is more costly. This completely changes where and how the elite can spend their money, and what they can and can’t consume. The rising “servant economy” rests on a wide relative gap between high and low incomes.

Put it all together and that’s why we’re seeing such an intense debate about Fed policy in the current economic situation. It’s not just about interest-rate spreads for banks. It’s about the larger and more complex issue of class bargaining power—inside corporations (between workers and capitalists over the size of profits, and between capitalists and the management to which they distribute a portion of the profits) and outside corporations (not only in terms of the commodities capitalists sell to workers, but also the “booty” they share with shareholders, investors, financial institutions, and others).

As Spross puts it,

Elites obviously don’t want to completely tank the economy. But it certainly works for them if it stays modestly stagnant, maximizing the growth of the pie while minimizing worker bargaining power.

It’s the Goldilocks principle: Don’t run the economy too hot or too cold. Run it just right.

achievement gap


We all know the gap between the rich and poor in the United States has been growing for decades—and there’s been no let-up of that trend during the current economic recovery.

That’s bad enough. However, unless we confront that problem and change the existing institutions, it’s only going to get worse in the decades ahead. That’s because, as Michelle Chan [ht: ja] explains, the country is leaving way too many children behind.

Poverty limits access to basic resources like nutrition and decent childcare. But a geometrically expanding class divide looms over all income brackets, as wealthier parents zealously splurge on “enrichment expenditures”. . .

So poor parents struggling just to cover basic food and shelter face both massive income inequality in their day-to-day lives, plus a seven-fold gap in the amount they can “invest” to help their children thrive in the future. Given that social mobility is already suppressed at all income levels—with children’s future earnings highly correlated with the earnings of their parents—the Herculean amount of “catch up” poor parents must undertake just to get on the same footing as their higher-earning peers makes the great American wealth gap seem even more devastating, for both today’s working households and generations to come. . .

economic status is a growing factor in academic outcomes, as “the relationship between income and achievement has grown sharply” over the last 50 years. So wealth trumps intellect on many levels.

In other words, the income gap is a growing factor in academic outcomes—and the children at the bottom are falling further and further behind.

Why? The achievement gap stems in part from the difficulty poor parents have in educating their children at home, as well as the massive funding gaps in programs like subsidized childcare and Head Start. It’s also because poor children are segregated outside the home into poorly funded and overburdened schools. The exact opposite has been taking place at the top, where both private and public expenditures are moving the children of wealthy households further and further ahead.

All of which means that, just as the income gap has grown sharply since the mid-1970s, so has the relationship between income and academic achievement.

The growing class divide in the United States looms over all aspects of society, especially the fate of our children.


Marx, it seems, just won’t go away.

According to Charles Moore in the Wall Street Journal,

When things go backward in nations accustomed to middle-class stability, people start to ask questions. What is the use of capitalism if its rewards go to the few and its risks are dumped on the many? The rights of property do not seem so enticing if the value of what you own collapses or if that property is trapped by debt. What is so great about globalization if it means that the products and services you offer are undercut by foreign competition and that millions of new people can come to your country, take your jobs and enjoy your welfare benefits?

Great international banks and other corporations—and their top executives—can devise a life that escapes normal tax jurisdictions. Their successes are globalized and accrue chiefly to them; their failures crawl back home to die, at the expense of the rest of us.

So instead of feeling that it is a privilege to be an ordinary citizen of a free country, many of us start to feel a bit like suckers. Hope—the inseparable companion of progress—fades and is replaced by disappointment, even bitterness. It has always been understood that opportunity carries some price of insecurity, but what happens if insecurity rises and opportunity contracts?

Moore warns that, if Western countries can’t disprove Marx’s “dire forecasts” about a growing gap between the haves and have-nots, capitalism is going to be in trouble. In fact, he concedes,

Marx did have an insight about the disproportionate power of the ownership of capital. The owner of capital decides where money goes, whereas the people who sell only their labor lack that power. This makes it hard for society to be shaped in their interests. In recent years, that disproportion has reached destructive levels, so if we don’t want to be a Marxist society, we need to put it right.

1percent grand compromise

Ray Fisman and Daniel Markovits suggest that we’re seeing right now, with the insurgent campaigns of Donald Trump and Bernie Sanders and elite hopes that they will just fade away, are “early skirmishes in a coming class war.”

Why? Because their research (along with coauthors Pamela Jakiela and Shachar Kariv, just published in Science) revealed stark differences between attitudes toward economic justice between ordinary Americans and those at the top. Basically, the elites (both intermediate and extreme) are much more likely to be selfish as their compatriots in general. What’s more, elite Americans show a far greater commitment to efficiency over equality than ordinary Americans.

Our results thus shine a revealing light on American politics and policy. They suggest that the policy response to rising economic inequality lags so far behind the preferences of ordinary Americans for the simple reason that the elites who make policy—regardless of political party—just don’t care much about equality. Hemingway’s illusory but widely shared view that the only thing that separates the rich from the rest is their money thus disguises a central pathology of American public life. When American government undemocratically underdelivers economic equality, the cause is less party than caste.

So, even though the United States has exhibited growing and increasingly grotesque economic disparities between a small group at the top and everyone else for almost five decades, little has been done to address the problem of economic inequality. The tendency, as I have argued, has been to pathologize the poor.

What Fisman et al. do is to turn their attention to the pathologies of the rich and the fact that “elite Americans are not just middle-class people with more money.”

They display distinctive attitudes on basic moral and political questions concerning economic justice. Simply put, the rich place a much lower value on equality than the rest. What’s more, this lack of concern about inequality among the elite is not a partisan matter. Even when they self-identify as progressive Democrats, elite Americans value equality less highly than their middle-class compatriots.

The question going forward is who will control public policy: the small elite who aren’t much concerned with issues of inequality or the majority of the population who place a much higher value on equality.

The fact is, one side in the class war has been winning since the mid-1970s. Now is the time to turn it around, so that ordinary Americans will get the policies they want and deserve.


It’s more than 50 years after the March on Washington for Jobs and Freedom and we’re still having a hard time thinking through the relationship between race and class in the United States, as we have seen in the recent tensions between Black Lives Matter and the Bernie Sanders campaign.

For the organizers of the 1963 march, issues of race and class were inextricably connected. That’s why the coalition that sponsored the march focused on both civil rights and the creation of jobs through public works, on eliminating segregation and raising the minimum wage, on making sure that whites and blacks were able to march together. They weren’t “class reductionists.” They were attempting to forge a movement that could eliminate both racial disparities and economic exploitation.

Touré F. Reed [ht: db] delves back into that history in order to demonstrate that, while liberals have always had a difficult time in focusing on the nexus between racism and class, the United States has a long history of thinking through and organizing around both issues.

Many contemporary activists, broadly defined, are quick to dismiss as racist deflection any attempts to view racial disparities through the lens of class inequality, but in the 1930s and 1940s mainstream African-American civil rights leaders — among them Lester Granger of the National Urban League, Walter White of the NAACP, John P. Davis of the National Negro Congress, and of course A. Philip Randolph of the Brotherhood of Sleeping Car Porters (BSCP) — frequently argued that precisely because most blacks were working class, racial equality could only be achieved through a combination of anti-discrimination policies and social-democratic economic policies.

But by the 1950s, the anticommunism of the Cold War had a chilling effect on class-oriented civil rights politics, setting the stage for analyses of racism that divorced prejudice from economic exploitation — the fundamental reason for slavery and Jim Crow. Indeed, this was the era in which racism was recast as a psychological affliction rather than a product of political economy.

As McCarthyism receded by the end of the 1950s, however, mainstream black civil rights leaders once again identified economic opportunity for all — decent-paying jobs and social-democratic policies — as essential to racial equality.

The black organizers of the 1963 March on Washington for Jobs and Freedom (it is telling that “Jobs and Freedom” are no longer part of collective reflections of the march), Randolph and Bayard Rustin — both of them socialists — were very clear about this.

Which brings us up to the issue of Ferguson and other instances of police brutality today.

In separating the problem of police brutality from political economy, many activists — like, ironically, the liberal as opposed to left approach to racial inequality — not only undercut the opportunity for broader political alliances and perhaps some meaningful victories, but sidestep the same crucial point about police brutality that both liberals and conservatives look past. . .

If one views the excesses and failures of the criminal justice system solely through the lens of race, then victims of police brutality and prosecutorial misconduct tend to be black or Latino. However, if one understands race and class are inextricably linked, then the victims of police brutality are not simply black or Latino (and Latinos outnumber blacks in federal prisons at this point) but they tend to belong to groups that lack political, economic, and social influence and power.

From that vantage point, the worldview expressed by Johnson and others misses the mark and falls into the same trap that, ironically, liberals have offered a stratum of credentialed black Americans for decades: opportunity within a market-driven political and economic framework that disparages demands for social and economic justice for all (including most black people) as socialist, communist, un-American, or even class-reductionist.

Last week, Sesame Workshop, the nonprofit group behind the children’s television program, struck a five-year deal with HBO, the premium cable network, that will bring first-run episodes of “Sesame Street” to the premium cable network nine months before reaching PBS viewers for free.

Jessica Winter provides some of the background to the creation of “Sesame Street,”

The historical moment that made Sesame Street possible is unimaginable today. (Exhibit A: During one of the 2012 presidential debates, Mitt Romney held up Big Bird as an example of wasteful government spending. As PBS later pointed out, “the federal investment in public broadcasting equals about one one-hundredth of one percent of the federal budget.”) The public television producer Joan Ganz Cooney got the idea for Sesame Street in 1967, during the decade of the War on Poverty, which produced the Economic Opportunity Act of 1964—among other things, this established Head Start, the health and education program for low-income pre-school children and their families—as well as Job Corp and the Social Security Act of 1965. And 1967 was also the year that Congress established the Corporation for Public Broadcasting, which brought us PBS and NPR.

In this fertile progressive epoch, Ganz Cooney raised $8 million (from the CPB, the U.S. Department of Education, and various foundations) to found the Children’s Television Workshop. Its flagship show, Sesame Street, had the mission of teaching basic alphabetical and numerical concepts to children ages three to five.

Ganz Cooney’s big bet was that the television set, present in 97 percent of American households by the mid 1960s, could become a delivery device of early education even to some of the poorest and most culturally deprived households. It could help close the gap between affluent children and their lower-income peers.

As for the change:

Sesame Street was founded to help low-income kids keep up with their more affluent peers. That is literally why it exists. It succeeded beyond anyone’s expectations. And now it is becoming the property of a premium cable network, so that a program launched to help poor kids keep up with rich kids is now being paywalled so that rich kids can watch it before poor kids can.

That in itself is not a tragedy or an injustice. Tragedy is the devastating funding cuts that Head Start has suffered in recent years, affecting tens of thousands of young children. Injustice is the nationwide lack of subsidized high-quality child care and universal pre-K. In this context, relocating Sesame Street to the gated community of HBO—even if that community’s gates swing wide at nine-month intervals—is only to be expected. There could be no more cruelly perfect metaphor for the ultra-efficient sorting processes of socioeconomic privilege.


Should capitalists plan on putting The Doors on their karaoke machines?

According to Paul Mason they should. Me, I’m not convinced.

Before discussing Mason’s argument, let me get a few things out of the way. First, Mason implies he invented the word “postcapitalism,” which makes as much sense as the idea that Al Gore invented the internet. (But maybe Mason gives credit to the long line of other postcapitalist thinkers in the book, which I’ll have to read when it’s published.) Second, I’ve long been suspicious of technological determinist arguments, that is, the attempt to explain history and society (mostly or solely) on the basis of changes in technology. (That’s not to say technology doesn’t matter; just that it’s a mistake to treat it as the essential cause of everything else.) Finally, the bit about Marx’s “Fragment on Machines” (pdf) represents a terrible misreading. (The passages from the Grundrisse are not, as Mason would have us believe, about “an economy in which the main role of machines is to produce, and the main role of people is to supervise them,” but a form or stage of capitalism in which laborers become appendages of machines as a condition for the existence of more, relative surplus-value.)

There is, in fact, a great deal to appreciate in Mason’s discussion. I’m thinking, in particular, of his critique of neoliberalism (which “has morphed into a system programmed to inflict recurrent catastrophic failures” and to create mostly “low-value, long-hours jobs”) and the problems mainstream economists have had in making sense of both information (since they start with the presumption of scarcity) and the rise of new kinds of economies (such as parallel currencies, time banks, cooperatives and self-managed spaces, which they mostly ignore as irrelevant to the “real” economy). I even like Mason’s discussion of the new opportunities for collaboration and the reduction of work time created by recent changes in information technology (although many of us are actually forced to have the freedom to perform more, not less, labor as a result of digital information and information-based automation).

For me, the biggest problem with Mason’s treatment is his two-part argument: that capitalism will necessarily fail when it comes to dealing with new information technologies and that such technologies will necessarily usher in a new, noncapitalist economic and social order, ushered in by “a new agent of change in history: the educated and connected human being”). I just don’t see it.

Let’s consider each of the two parts in order. First, the idea that capitalism will come crashing down as information grows. The key element, for Mason (and for many others before him, such as Jeremy Rifkin), is that the new communication technologies are reducing the marginal (per-unit) cost of producing and sending information goods to near zero, which means that if information goods are to be distributed at their marginal cost of production (zero) they cannot be created and produced by capitalist firms that use revenues obtained from sales to consumers to cover their costs and to realize profits. And that’s the rub: it is precisely the existence of private property (and the other conditions of existence of private commodity production) that keeps the cost of information from going to zero. Information may “want to be free” and capitalist property is certainly an obstacle to the flow of more information but that doesn’t mean information is or will be costlessly produced or utilized. For every Wikipedia there are hundreds of Microsofts—and thousands of other capitalist enterprises that utilize proprietary information to produce still other commodities.

The other side of the argument is thus also questionable: there’s nothing about new information technologies that necessarily lead to forms of economic organization different from or beyond capitalism. Would but that were the case! It’s certainly possible that a democratically organized, worker-owned enterprise would be able to take advantage of networking and other new forms of organizing information but the mere existence of such information technologies does not bring new forms of noncapitalist enterprise (or other socialist or communist forms of economic organization) into existence. I do think we need to pay attention to the way “educated and connected” human beings are utilizing new information technologies (as I often remind my students, they permit such activities as “stealing” the digital information in music and videos and then “sharing” that information within and between communities). But, we need to remember, lots of people have organized noncapitalist forms of economic organization long before the new information technologies were imagined, and they’ll continue to do so (perhaps in different forms) within and at the margins of “cognitive capitalism.”

But to get there—to allow such noncapitalist forms of economic organization to be imagined and put into practice—we need more than new information technologies. We need a ruthless critique of the existing economic order and forms of political organization (aka a political party) to produce utopian discourses and concrete interventions to move us in that direction.


While I’m on the topic of postcapitalism, let me also take up the case for socialist recently made by Gar Alperovitz and Thomas M. Hanna. Once again, I’m sympathetic—especially since the more talk about socialism these days the better. And Alperovitz and Hanna do make a convincing case for public ownership and control, including the fact that we already have lots of examples (from the Texas Permanent School Fund to the Tennessee Valley Authority, from publicly owned electric utilities to public internet systems) in our midst. Great! There are lots of ways for the state to distribute the surplus to meet social needs and there’s no reason to limit ourselves to tax-and-spend policies. Why not let the state take direct control of economic activities? But then let’s also talk about how the surplus is produced and appropriated within such state enterprises. If we don’t, then we’re just talking about expanding state capitalism (capitalist enterprises that are owned and/or regulated by the state) and not about eliminating capitalist exploitation itself.

Both Mason and Alperovitz and Hanna seem to overlook that particular aspect—the class dimensions—of the critique of political economy.