In the late 1800s, the People’s Party—with its base in poor white cotton farmers in the south and wheat farmers in the plains states—agitated against railroad barons who charged a high rate for transporting their produce and against bankers to whom many were hopelessly indebted. The nineteenth century also saw strikes by textile and railroad workers against sub-standard wages and poor working conditions as well as a trade union movement and an anti-rent movement against the abuses of landlords. The twentieth century was no less revolutionary; the broad-based Progressive Movement to reform education and labor laws, promote conservationism, and regulate big business was largely rooted in the “muckraking” journalism of Ida Tarbell, Upton Sinclair, and others who wrote provocative diatribes about corporate malfeasance. There was also the suffrage movement and Equal Rights Amendment struggle for women, the civil rights movement for African Americans, and the fight for indigenous rights. People went to battle in the street to end the Vietnam War, fight segregation in the South, and protest the exploitation of farm laborers. In the late 1960s, “Nader’s raiders” agitated for consumer protections as well as federally mandated clean air and water standards at the FTC; in the 1980s, students and activists protested against U.S. support for murderous military juntas in Latin America and the nuclear arms race.
Over the past 20 years, however, Americans have largely eschewed the street. True, there were protests against the First and Second Gulf Wars. There was the Battle of Seattle in 1999 to raise awareness about the ill-effects of globalization, but there has been precious little else. A hotbed of political activism in the 1960s, today’s university campuses chiefly serve as a means of professional advancement. Beginning in the 1980s, students increasingly set their sights on getting into top business and law schools in hopes of joining the ranks of Masters of the Universe, or at least the upper middle class.
Our counterparts in Europe, by contrast, have lost none of their enthusiasm for the street. Since the most recent global financial crisis and announced austerity packages, national and international media have brought us images of rioting or marching students, workers, and pensioners in Athens, Rome, Dublin, London, Madrid, and Paris. In late November, tens of thousands of Irish citizens protested their government’s decision to bail out Irish banks at the expense of the national treasury; two weeks later, thousands of British students clashed with police in central London to protest increased tuition fees from a nominal amount to the cost of a modest state school in the U.S. To the average European, it is an outrage of epic proportions that average citizens should be asked to bail out wealthy bankers who continue to prosper while ordinary citizens are made to foot the bill. And they have made this abundantly clear.
In America, by contrast, the most vociferous protests have been directed against government efforts to tame Wall Street excesses and the abuses of monopolistic health insurance companies that charge exorbitant fees for uncertain coverage. Rage over government bailouts and fiscal irresponsibility is mainly aimed at the socialist Obama administration that has supposedly taken over the economy and forced taxpayers to bail out irresponsible and greedy (read: poor, minority) homeowners. In this respect, it is revealing that the only significant grass roots protests related to the fiscal crisis have been the (largely corporate-sponsored) Tea Party movement. Although a big-tent movement, what unites Tea Partiers is a determined effort to ensure that Big Health, Big Oil, and Big Finance (aka Wall Street) be allowed to continue business-as-usual without interference from Big Government. The guiding logic is that government hampers business, which is critical to the success and health of the American economy and, by extension, the moral underpinnings of American society.
What explains the differential response to bailouts and cuts in social programs on either side of the Atlantic?
It is common to put such differences down to American values of rugged individualism and our deeply-rooted suspicion of government. But it is worth remembering American hatred of government has not been the historical constant that we imagine. Despite the received wisdom that American social welfare lagged behind that of other western countries, a large swath of American males and their families enjoyed pensions already in the late 19th Century. In the mid-twentieth century, FDR (widely considered one of America’s greatest presidents) pushed through legislation to establish universal pension benefits, disability insurance, relief for the unemployed, enforcement of collective bargaining rights and the minimum wage, subsidies for farmers, and so on. One of the most popular New Deal programs, the Civilian Conservation Corps, employed millions of out-of-work young men, giving them three square meals a day and a dollar for each day’s work, most of which they sent home to their families. In return, they built many of our national parks, planted 3 billion trees, constructed highways and roads, and implemented conservation projects. In his 1944 State of the Union Address, FDR unveiled his “second” or “economic” bill of rights, which would guarantee every citizen the right to decent shelter, employment with a living wage, adequate medical benefits, freedom from “unfair competition and monopolies”—the Second Bill of Rights provided inspiration for the 1948 Universal Declaration of Human Rights, although efforts to realize these principles in the States ended with FDR’s death.
Since today’s Americans have far less than Europeans to cushion them from abject poverty, it is reasonable to ask what explains the lack of social protests against cuts in education, social security, and other social programs in the States. Where are the millions upon millions of pensioners who should be protesting the proposals of the “catfood commission” to reduce retirement benefits and raise the retirement age? After all, about 43 percent of working Americans have less than 10,000 USD in savings and will depend almost entirely upon Social Security benefits.
Is it because the standard of living in America is still comparatively better than that of our European counterparts and keeps rising with time—making social programs relatively less important? Clearly this is not the case. Although the net worth of the top one percent of income earners has tripled in the past twenty years, the bottom 90 percent has remained relatively flat. Meanwhile, the costs of education and health care have shot through the roof.
Tuition fees for state schools have increased by over 60 percent in the past decade; private schools are now 30 percent more expensive. This is at a time when student aid programs are facing massive cut-backs, so many are forced to take out massive loans, often with commercial banks, greatly undermining their ability to build up a nest egg in their 20s and 30s. Jobs are no longer plentiful, and a college degree no longer inoculates one from unemployment. Having children is for many Americans a one-way ticket to poverty given the spiraling health insurance premiums, the price of education, and the like. According to Harvard Law Professor Elizabeth Warren:
"Our research eventually unearthed one stunning fact. The families in the worst financial trouble are not the usual suspects. They are not the very young, tempted by the freedom of their first credit cards. They are not the elderly, trapped by failing bodies and declining savings accounts. And they are not a random assortment of Americans who lack the self-control to keep their spending in check. Rather, the people who consistently rank in the worst financial trouble are united by one surprising characteristic. They are parents with children at home. Having a child is now the single best predictor that a household will end up in financial collapse."
There is also less upward mobility in America today than in any other high-income country in the world except Britain, including France, Germany, Sweden, Finland, Canada, and Denmark—where the principal means of upward mobility, a higher education, is still free or at least affordable to most.
The average American household carries almost 85,000 USD in personal debt, including about 10,000 USD in credit card debt. The average college graduate leaves owing nearly 20,000 USD; today, over 40 percent of American households spend more than they earn.
There is no question that the American middle class is under full frontal assault by market forces—a situation made all the more dire because our political class no longer protects the basic welfare of the poor and middle class. But the question remains: why have Americans failed to mobilized? Why have the riots and protests we see in Europe not been replicated on this side of the Atlantic?
One explanation is that Americans have decided that protests are anyway a lost cause because Congress and the Presidency have shown blatant disregard for popular preferences. The vast majority of Americans wanted out of Iraq already 5 years ago; former Vice President Dick Cheney famously said “who cares?” in response to an interviewer’s observation that a majority of Americans opposed the war. This pattern remains under the new administration, as a majority opposed Obama’s accelerated troop deployments to Afghanistan two years ago. In the course of health care reform, polls showed that over two-thirds of the public felt that the government must ensure universal health care. More recently, Bush’s budget-busting tax cuts were extended to the very wealthy—in the face of strong popular support for ending or phasing out tax cuts for the rich.
A second reason for inaction may be that the pressures facing the American middle class are far more diffuse than they are in Europe. With the cost of health care and education largely unregulated, the hike in costs of these two major items has occurred non-transparently, with universities and health insurance companies increasing their fees in an apparently uncoordinated manner. With no central decision-maker responsible for the hike in costs (such as the British government tripling university tuition fees), there are no obvious targets that can serve as mobilizational rallying points.
Third, the American media have long underplayed public opposition to the Iraq war, the Patriot Act, and bank bailouts; scattered protests in America against planned cuts in education received better coverage in the international press than in American media. It may appear that we are more apathetic than we actually are because protests against health insurance companies, banks, and cuts in social services are largely ignored by the American media. Seeing this, would-be protesters may understandably conclude that their time is better spent elsewhere.
But there is another, more insidious reason for popular inaction as Congress enacts the agendas set out by corporations, and that is America’s unique blind-spot concerning class.
Americans and continental Europeans tend to have very different understandings of wealth disparities. For Europeans, it is universally understood that the class into which one was born is a very powerful predictor of one’s success in life; in America, the very notion of class borders on heresy. Even thinking about class is understood as un-American and likely to lead us down the road to fascism/Marxism/Leninism/socialism/Maoism (pick your favorite boogieman).
In America, the class into which one is born is viewed as irrelevant, or, at most, ephemeral. Those who face crippling debt and spiraling health and education costs have not planned well or must simply suck it up because that is the cost of good medicine and education. Rather than investigate corporate malfeasance, today’s American media are content to regurgitate corporate press releases—embedded in the meme that it can still be “morning in America” so long as government keeps out of the way of business. Rich people are given to be somehow better or more virtuous than the rest of us—after all, they would not be wealthy had they not worked damn hard for their money. One clownish pundit has even crusaded for erecting a huge “bronze and granite” statue in Washington in honor of all that the wealthy have done for this country.
A comment posted on the said pundit’s website says it all:
“I just read Bernard's column on building a statue honoring the rich in the USA. All I can say is, "AMEN". I do not consider myself "rich", but I do have a good-paying job and I pay my fair share of taxes. For many years I mistakenly thought that the richest Americans should pay a lot more in taxes and ease the burden on the middle class. For that, I apologize. I've been reading Mitt Romney's book, "No Apology", and have had my eyes opened to the stark realities of economics in the US and in the world, to which I had no clue. The things Governor Romney talks about in his book are the very things that Bernard touched on in this column about honoring and thanking the rich in America.
“Thank you, rich people. I'll contribute to that monument if someone designs it. And Mr. Goldberg, thanks for the reminder. Merry Christmas!”
America’s blind spot regarding class is likely to persist for as long as being a patriotic American is equated with the belief that in America one can succeed, indeed become wealthy, so long as one works really hard—the belief that one’s fortune (or lack thereof) is a direct reflection of the value of one’s labor. After all, what is America if not the fabled land of opportunity, of milk and honey, and Horatio Alger successes—where bright and motivated immigrants can come to the country with nothing and create a bright future for themselves and their kids and grandkids?
The contrast with continental Europe could not be starker. In most, if not all, of these countries, the rich are expected to give back to society since their prosperity is viewed as the collective product thereof; it is well understood that their fortunes would not be possible without public assistance and the support and hard work of their fellow citizens. Moreover, it is axiomatic that richer members of society have a moral obligation to pay more in taxes than the poor and middle class; great disparities of wealth are frowned upon and seen as a societal ill; in the States, such disparities are seen as a healthful motivation for people to work harder and thereby grow the economy.
In few countries outside the States, in fact, is one likely to see the poor and middle class willing to accept cuts their meager social benefits so that the rich will be encouraged to invest more in the economy. It is a convenient myth perpetrated by the monied class that the public must do its utmost to feed the market beast by levying minimal taxes and treating corporations as gently as possible. If we demand corporate rectitude and a greater share of their outsized profits, we are engaging in class warfare and will be duly punished by a drop in the Dow and the accelerated offshoring of American jobs. The poor and middle class will never win at this game.
The first and best means of breaking this cycle of abuse is to acknowledge that (1) corporations and the rich have their own best interests at heart and these are rarely aligned with the interests of the vast majority of Americans, (2) the profit motive does not by itself result in a more prosperous and functional society for all, and (3) the government is not our enemy, but our best and (presently) only means of protecting the public interest against market vagaries and corporate exploitation. Once the rich are no longer worshipped as economic rainmakers and the surest route to prosperity, then we have effectively toppled them from their “bronze and granite” pedestal. We will be more likely to demand that they pay their fair share in taxes and that the government check the abuses of those who have gamed the system. Our ultimate goal should be something along the lines of FDR’s economic bill of rights, which would be infinitely more valuable than vague promises of a sumptuous life that is increasingly out of reach of the vast majority of Americans.