Thursday, April 30, 2015

Baltimore: it's the economy, stupid


As the city of Baltimore works to recover from a series of riots after an African American man died while in police custody, there is an inevitable pointing of fingers.

It is seen, among other things, as an indicator of continuing racial discrimination, a pattern of police brutality, and criminal actions on the sides of both authority and populace. However, there is a root matter that is coming to the fore that must be examined and addressed if the situation in Baltimore is to be ameliorated. What's more, this cancer in question is a matter not simply for the city of Baltimore to handle but a threat to the entire United States as well.

The real issue is economic inequality.


Nouriel Roubini, a noted New York University economist who predicted the housing bubble and the crash of 2008, points out this very fact in an interview with CNN.

"We've seen race riots in parts of the United States because lots of people are poor and angry and resentful," Roubini told CNNMoney's Cristina Alesci at the Milken Global Conference in Los Angeles. "The solution can't just be to send more police in the streets or the National Guard. People are desperate. We have to deal with this issue of poverty, of unemployment and economic opportunities."

Indeed, the unemployment rate in Baltimore is 1 in 5 and the median income is an astonishingly low $24,000, which is below the poverty line for a family of four.

This is far from the first time that the issue of economic inequality has been raised. In a landmark address, President Obama called it the "defining issue of our time." Robert Reich, former Secretary of Labor and Chancellor's Professor of Public Policy at UC Berkley, has often noted that it is more difficult now than ever before to achieve social mobility between economic classes and thus there is a sense of powerlessness among workers. So what has the response been from political leadership?

Republicans for one keep pushing to cut taxes on the wealthy to the tune of about $269 billion. Said legislation would provide protection for the top 1% of families and the wealth that they inherit. This, in combination with other tax breaks for the rich and for corporations has helped contribute to the largest growth of wealth for the top 1% in 30 years. In turn, such accumulations of wealth provides the 1% richest the ability to exert control over the political process, in effect "rigging the game." This, in part, led political scientists at both Princeton and Northwestern universities to determine that the United States is far more of an oligarchy than a republic.  

Don't tell that to Senator Marc Rubio, though. In a statement in 2011, Mr. Rubio decried the notion that this economic inequality has led to a nation of haves and have-nots. “We are a nation of haves and soon-to-haves, of people who have made it and people who will make it,” he asserted, sounding something of a personification of the John Steinbeck quote that the poor have been indoctrinated to see themselves as "not as an oppressed proletariat but as temporarily embarrassed millionaires." Mustering a calm and intelligent response to Rubio's logically-challenged statement is difficult, but here goes.

What Rubio fails to understand is the plain fact that the majority of wealth in America is inherited. Your ability to succeed is due largely in fact to how well-off your parents are. The notion of the self-made rich is largely a myth, hence the Republican call for an end to inheritance tax. This line of thinking is useful, however, to perpetuate the adage that "if you just work harder, you will prosper. This has become known as "meritocracy." Such a mantra, given time, becomes systemic. If work equals wealth, then by that line of reasoning the poor are not working hard enough. Therefore, there must be something wrong with them and they personify the "lazy rabble" Mr. Potter warned of in It's a Wonderful Life.

This is especially useful in the case of Baltimore, where a popular accusation thrown at rioters was that they should "get a job"(please see the above unemployment figures from Baltimore.) The mantra likewise becomes something of a carrot to be waved in front of those unaware of the facts of the economic inequality. "Come on, you can do it," someone in the 1% might say, the green, leafy top of the root vegetable dangled between thumb and forefinger before moving back a few more steps. "Oh, you've gotta be quicker than that!" Not only that, but any critique of the mantra can then be met with Fox News allegations of "class warfare" or accusations of latent communism.

But wait. The "just work hard" mantra is on even shakier ground upon closer examination. Not only does wealth appear to be a matter of dumb luck in terms of who your parents happen to be, it also matters how much help you get. Author Malcolm Gladwell clearly describes this in his 2011 book, The Outliers. A case study examined in the book is that of Bill Gates, founder of Microsoft and one of the world's wealthiest people. Is Gates smart and talented? Of course he iss. Did he work hard to build his business? Of course he did. 

He also happened to be born in an affluent suburb and go to a school that had quality teachers and a computer club. In fact, parents in the community were able to fund the purchase of an exceptionally advanced computer upon which Gates cut his teeth. "I was very lucky," Gates said. Nobody does it on their own. Do the people of Baltimore have the same advantages? The data would seem to indicate otherwise.

To be clear, no rational thinker is calling for an end to hard work. No society can advance without work as nothing is free. Likewise, despite allegations to the contrary, few think that an outpouring of unmitigated aid, those diabolical "handouts" that conservatives shriek about, that would create a completely equal system. There will never be a society with complete and total equality. As Republicans seem quick to point out, "hey, life is not fair" (to which one may wonder why they rapidly cry "unfair!" at the idea of raising taxes on the wealthy.) It is the role of government, however, to help make things as fair as possible. As stated in the Declaration of Independence, life, liberty, and the pursuit of happiness are inalienable rights. What many seem to overlook, particularly conservatives, is the phrase that follows the stating of those rights: "That to secure these rights, Governments are instituted among Men." 

A city like Baltimore does not arrive at its current unemployment rate via a population that is lazy and simply wants to sit on the couch and eat bon-bons. We can no longer afford to berate those struggling economically as "not working hard enough" or utter the capricious piffle that they should simply "get a job." We can no longer cry "we can't afford that!" to prospective policies to empower the working class while simultaneously screaming "that's anti-American!" to proposals to tax the wealthy and corporations (click here to see where corporate welfare and "too big to fail" has gotten us.) Racial inequality and economic inequality are quite a potent cocktail. Just the right shove in just the right place and all the dominoes can start to fall.

Here's the scary part: If we don't change both policy and perspective, Baltimore might be just the beginning.




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