Wednesday, November 15, 2006
Boy Am I Glad This Guy Got Elected
I know Senator-Elect James Webb's opinion piece from the Wall Street Journal has been on a few of the liberal blogs already today, but I found it to be very compelling reading. Here it is in full, just in case you missed it and the WSJ decides to stick it behind a pay wall:
And Tucker Carlson thinks this guy is more conservative than George Allen?
The most important--and unfortunately the least debated--issue in politics today is our society's steady drift toward a class-based system, the likes of which we have not seen since the 19th century. America's top tier has grown infinitely richer and more removed over the past 25 years. It is not unfair to say that they are literally living in a different country. Few among them send their children to public schools; fewer still send their loved ones to fight our wars. They own most of our stocks, making the stock market an unreliable indicator of the economic health of working people. The top 1% now takes in an astounding 16% of national income, up from 8% in 1980. The tax codes protect them, just as they protect corporate America, through a vast system of loopholes.
Incestuous corporate boards regularly approve compensation packages for chief executives and others that are out of logic's range. As this newspaper has reported, the average CEO of a sizeable corporation makes more than $10 million a year, while the minimum wage for workers amounts to about $10,000 a year, and has not been raised in nearly a decade. When I graduated from college in the 1960s, the average CEO made 20 times what the average worker made. Today, that CEO makes 400 times as much.
In the age of globalization and outsourcing, and with a vast underground labor pool from illegal immigration, the average American worker is seeing a different life and a troubling future. Trickle-down economics didn't happen. Despite the vaunted all-time highs of the stock market, wages and salaries are at all-time lows as a percentage of the national wealth. At the same time, medical costs have risen 73% in the last six years alone. Half of that increase comes from wage-earners' pockets rather than from insurance, and 47 million Americans have no medical insurance at all.
Manufacturing jobs are disappearing. Many earned pension programs have collapsed in the wake of corporate "reorganization." And workers' ability to negotiate their futures has been eviscerated by the twin threats of modern corporate America: If they complain too loudly, their jobs might either be outsourced overseas or given to illegal immigrants.
This ever-widening divide is too often ignored or downplayed by its beneficiaries. A sense of entitlement has set in among elites, bordering on hubris. When I raised this issue with corporate leaders during the recent political campaign, I was met repeatedly with denials, and, from some, an overt lack of concern for those who are falling behind. A troubling arrogance is in the air among the nation's most fortunate. Some shrug off large-scale economic and social dislocations as the inevitable byproducts of the "rough road of capitalism." Others claim that it's the fault of the worker or the public education system, that the average American is simply not up to the international challenge, that our education system fails us, or that our workers have become spoiled by old notions of corporate paternalism.
Still others have gone so far as to argue that these divisions are the natural results of a competitive society. Furthermore, an unspoken insinuation seems to be inundating our national debate: Certain immigrant groups have the "right genetics" and thus are natural entrants to the "overclass," while others, as well as those who come from stock that has been here for 200 years and have not made it to the top, simply don't possess the necessary attributes.
Most Americans reject such notions. But the true challenge is for everyone to understand that the current economic divisions in society are harmful to our future. It should be the first order of business for the new Congress to begin addressing these divisions, and to work to bring true fairness back to economic life. Workers already understand this, as they see stagnant wages and disappearing jobs.
America's elites need to understand this reality in terms of their own self-interest. A recent survey in the Economist warned that globalization was affecting the U.S. differently than other "First World" nations, and that white-collar jobs were in as much danger as the blue-collar positions which have thus far been ravaged by outsourcing and illegal immigration. That survey then warned that "unless a solution is found to sluggish real wages and rising inequality, there is a serious risk of a protectionist backlash" in America that would take us away from what they view to be the "biggest economic stimulus in world history."
More troubling is this: If it remains unchecked, this bifurcation of opportunities and advantages along class lines has the potential to bring a period of political unrest. Up to now, most American workers have simply been worried about their job prospects. Once they understand that there are (and were) clear alternatives to the policies that have dislocated careers and altered futures, they will demand more accountability from the leaders who have failed to protect their interests. The "Wal-Marting" of cheap consumer products brought in from places like China, and the easy money from low-interest home mortgage refinancing, have softened the blows in recent years. But the balance point is tipping in both cases, away from the consumer and away from our national interest.
The politics of the Karl Rove era were designed to distract and divide the very people who would ordinarily be rebelling against the deterioration of their way of life. Working Americans have been repeatedly seduced at the polls by emotional issues such as the predictable mantra of "God, guns, gays, abortion and the flag" while their way of life shifted ineluctably beneath their feet. But this election cycle showed an electorate that intends to hold government leaders accountable for allowing every American a fair opportunity to succeed.
With this new Congress, and heading into an important presidential election in 2008, American workers have a chance to be heard in ways that have eluded them for more than a decade. Nothing is more important for the health of our society than to grant them the validity of their concerns. And our government leaders have no greater duty than to confront the growing unfairness in this age of globalization.
And Tucker Carlson thinks this guy is more conservative than George Allen?
Comments:
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As interesting as James Webb is, his economic and political goals are mostly bad news.
Webb writes:
"The most important--and unfortunately the least debated--issue in politics today is our society's steady drift toward a class-based system, the likes of which we have not seen since the 19th century."
His claim is totally false. Bush and Kerry both attended Yale at the end of the era when social status was the key to admission to an ivy-league school.
Since then those schools have become meritocracies. With the exception of Cornell, none of the ivy league schools accepted women before 1971.
Webb writes:
"It is not unfair to say that they are literally living in a different country. Few among them send their children to public schools; fewer still send their loved ones to fight our wars."
More nonsense. Plenty of people who can afford private school send their kids to public schools, especially in suburban areas where there aren't many disruptive kids. In fact, most people who move out of NYC to the suburbs do so because they can send their kids to the local public schools confident that educating will take place.
Meanwhile, I know plenty of people whose kids are in NYC gifted programs and they are staying in those programs even though the parents can afford private school tuition.
As for those who fight our wars, well, West Point, Annapolis and the Air Force Academy are not filled with idiots. Our officer corps comes from every part of America. But poor students aren't likely to get in to these top schools.
Webb writes:
"They own most of our stocks, making the stock market an unreliable indicator of the economic health of working people. The top 1% now takes in an astounding 16% of national income, up from 8% in 1980."
More lunacy. Everyone with a retirement plan run by his employer is in the stock market. That means well over half the population is in stocks, whether they know it or not.
Meanwhile, national income has skyrocketed over the last couple of decades. While the top group might receive more of it, the whole pie has gotten so much larger that those further down are doing quite well as a result.
More to follow.
Till recent years, most corporations were white enclaves. That's no longer true. Pro sports were white bastions as well. No longer.
Meanwhile, class mobility is also part of the picture. Now you will find rich black entertainers and athletes at the same functions attended by rich white Wall Streeters.
If you have the green, you are welcome almost everywhere.
Webb writes:
"The most important--and unfortunately the least debated--issue in politics today is our society's steady drift toward a class-based system, the likes of which we have not seen since the 19th century."
His claim is totally false. Bush and Kerry both attended Yale at the end of the era when social status was the key to admission to an ivy-league school.
Since then those schools have become meritocracies. With the exception of Cornell, none of the ivy league schools accepted women before 1971.
Webb writes:
"It is not unfair to say that they are literally living in a different country. Few among them send their children to public schools; fewer still send their loved ones to fight our wars."
More nonsense. Plenty of people who can afford private school send their kids to public schools, especially in suburban areas where there aren't many disruptive kids. In fact, most people who move out of NYC to the suburbs do so because they can send their kids to the local public schools confident that educating will take place.
Meanwhile, I know plenty of people whose kids are in NYC gifted programs and they are staying in those programs even though the parents can afford private school tuition.
As for those who fight our wars, well, West Point, Annapolis and the Air Force Academy are not filled with idiots. Our officer corps comes from every part of America. But poor students aren't likely to get in to these top schools.
Webb writes:
"They own most of our stocks, making the stock market an unreliable indicator of the economic health of working people. The top 1% now takes in an astounding 16% of national income, up from 8% in 1980."
More lunacy. Everyone with a retirement plan run by his employer is in the stock market. That means well over half the population is in stocks, whether they know it or not.
Meanwhile, national income has skyrocketed over the last couple of decades. While the top group might receive more of it, the whole pie has gotten so much larger that those further down are doing quite well as a result.
More to follow.
Till recent years, most corporations were white enclaves. That's no longer true. Pro sports were white bastions as well. No longer.
Meanwhile, class mobility is also part of the picture. Now you will find rich black entertainers and athletes at the same functions attended by rich white Wall Streeters.
If you have the green, you are welcome almost everywhere.
Webb writes:
"The tax codes protect them, just as they protect corporate America, through a vast system of loopholes."
High-income people make a lot of money AND they pay a lot of taxes. Not only income taxes, they pay more property taxes, more sales taxes and more of every form of tax that exists in this country. It's that simple.
Webb writes:
"Incestuous corporate boards regularly approve compensation packages for chief executives and others that are out of logic's range."
Some CEO paychecks may be too high. But that's not a government problem. Stockholders of public companies have the power to knock down inflated paychecks. For years stockholders stood by and did nothing about overpaid executives.
In the last couple of years hedge funds have taken on that job. There are many hedge funds that aim to throw out ineffective overpaid managements. The SEC is looking into illegal handling of incentive stock options. Webb is way out of touch on this.
While a few people complain about excessive pay for corporate execs, many many more complain about the extraordinary deals given to pro athletes. Does anyone think A-Rod is worth what he's paid? Should the government step in and order the Yankees to cut his pay?
Webb wails:
"As this newspaper has reported, the average CEO of a sizeable corporation makes more than $10 million a year, while the minimum wage for workers amounts to about $10,000 a year, and has not been raised in nearly a decade."
There's millions of CEOs out there. Some of them own taxi medallions and drive their own cabs, some are house-painters, and some run organizations with large numbers of employees. How much should they earn?
Meanwhile, Webb is disingenuous when he says CEOs make $10 million while minimum-wage earners make $10,000 a year. At companies where CEOs earn big bucks, there are almost NO minimum-wage jobs. Does anyone at Microsoft earn minimum wage? If Microsoft operates its own cafeterias, perhaps those workers are near the bottom of the company's pay-scale. But so what? It surely isn't the fault of Bill Gates that those people haven't developed their skills for creating software. Meanwhile, I'll bet even the lowliest workers at Microsoft get a shot at something better in the company.
Webb blabbers:
"In the age of globalization and outsourcing, and with a vast underground labor pool from illegal immigration, the average American worker is seeing a different life and a troubling future."
Webb's preceding statement is a non-sequitur. No skilled laborer in the US is displaced by an illegal immigrant. Lawn-cutting and house-painting are very low-skill jobs. I know the guy who runs the lawn-cutting service in my Brooklyn neighborhood employs several illegal aliens.
So too does the Korean owner of the convenience store closest to my house. He wants to increase his income because his wife just had their second baby. He could hire a legal worker for minimum wage, but he can do a little better for his family if he employs the illegal alien.
Webb's whopper:
"Trickle-down economics didn't happen."
He's nuts. It absolutely has happened. To make a long story short, just check Milton Friedman's obituary. The most influential economist of the 20th century died a couple of days ago. His monetarist theories have guided White House thinking since Reagan moved into the White House. Benefits have flowed from the top of the economy to the bottom.
Webb rants:
"Despite the vaunted all-time highs of the stock market, wages and salaries are at all-time lows as a percentage of the national wealth."
He's comparing apples and oranges. Wealth and wages are not on the same financial statements. One is income and the other represents assets.
Webb blathers:
"At the same time, medical costs have risen 73% in the last six years alone. Half of that increase comes from wage-earners' pockets rather than from insurance, and 47 million Americans have no medical insurance at all."
Medical costs and healthcare expenses can NEVER decline. We develop more and more treatments, cures, technologies, and drugs to defeat more and more illnesses and maladies. This leads to a one-way trip of accelerating expenditures for a growing population.
Our humanitarian nature and our advancing medical technologies can combine to bankrupt the nation. And Webb seems like the guy who wants to lead the charge to national bankruptcy through healthcare.
"The tax codes protect them, just as they protect corporate America, through a vast system of loopholes."
High-income people make a lot of money AND they pay a lot of taxes. Not only income taxes, they pay more property taxes, more sales taxes and more of every form of tax that exists in this country. It's that simple.
Webb writes:
"Incestuous corporate boards regularly approve compensation packages for chief executives and others that are out of logic's range."
Some CEO paychecks may be too high. But that's not a government problem. Stockholders of public companies have the power to knock down inflated paychecks. For years stockholders stood by and did nothing about overpaid executives.
In the last couple of years hedge funds have taken on that job. There are many hedge funds that aim to throw out ineffective overpaid managements. The SEC is looking into illegal handling of incentive stock options. Webb is way out of touch on this.
While a few people complain about excessive pay for corporate execs, many many more complain about the extraordinary deals given to pro athletes. Does anyone think A-Rod is worth what he's paid? Should the government step in and order the Yankees to cut his pay?
Webb wails:
"As this newspaper has reported, the average CEO of a sizeable corporation makes more than $10 million a year, while the minimum wage for workers amounts to about $10,000 a year, and has not been raised in nearly a decade."
There's millions of CEOs out there. Some of them own taxi medallions and drive their own cabs, some are house-painters, and some run organizations with large numbers of employees. How much should they earn?
Meanwhile, Webb is disingenuous when he says CEOs make $10 million while minimum-wage earners make $10,000 a year. At companies where CEOs earn big bucks, there are almost NO minimum-wage jobs. Does anyone at Microsoft earn minimum wage? If Microsoft operates its own cafeterias, perhaps those workers are near the bottom of the company's pay-scale. But so what? It surely isn't the fault of Bill Gates that those people haven't developed their skills for creating software. Meanwhile, I'll bet even the lowliest workers at Microsoft get a shot at something better in the company.
Webb blabbers:
"In the age of globalization and outsourcing, and with a vast underground labor pool from illegal immigration, the average American worker is seeing a different life and a troubling future."
Webb's preceding statement is a non-sequitur. No skilled laborer in the US is displaced by an illegal immigrant. Lawn-cutting and house-painting are very low-skill jobs. I know the guy who runs the lawn-cutting service in my Brooklyn neighborhood employs several illegal aliens.
So too does the Korean owner of the convenience store closest to my house. He wants to increase his income because his wife just had their second baby. He could hire a legal worker for minimum wage, but he can do a little better for his family if he employs the illegal alien.
Webb's whopper:
"Trickle-down economics didn't happen."
He's nuts. It absolutely has happened. To make a long story short, just check Milton Friedman's obituary. The most influential economist of the 20th century died a couple of days ago. His monetarist theories have guided White House thinking since Reagan moved into the White House. Benefits have flowed from the top of the economy to the bottom.
Webb rants:
"Despite the vaunted all-time highs of the stock market, wages and salaries are at all-time lows as a percentage of the national wealth."
He's comparing apples and oranges. Wealth and wages are not on the same financial statements. One is income and the other represents assets.
Webb blathers:
"At the same time, medical costs have risen 73% in the last six years alone. Half of that increase comes from wage-earners' pockets rather than from insurance, and 47 million Americans have no medical insurance at all."
Medical costs and healthcare expenses can NEVER decline. We develop more and more treatments, cures, technologies, and drugs to defeat more and more illnesses and maladies. This leads to a one-way trip of accelerating expenditures for a growing population.
Our humanitarian nature and our advancing medical technologies can combine to bankrupt the nation. And Webb seems like the guy who wants to lead the charge to national bankruptcy through healthcare.
Webb writes:
"Manufacturing jobs are disappearing. Many earned pension programs have collapsed in the wake of corporate "reorganization.""
Domestic Maufacturing jobs are disappearing -- for at least two reasons. One is productivity. It is not low wages that draw jobs from the US to other regions. It is productivity. Good workers in other countries do earn less than US workers. But most workers in other countries are not as productive as US workers.
If cheap wages were the key, the US would have moved all its manufacturing to Haiti years ago. But those workers aren't productive.
The other major reason is the cost of energy. Energy is very expensive in the US and adequate supplies are not always avaiable for manufacturers. Thus, they go elsewhere.
We can repair the energy problem easily. It is a political problem, not a supply problem.
As for Webb's claims about pensions, well, he's misleading. A "reorganization" is another term for bankruptcy. If a company submits to a Chapter 11 reorganization, the company and its finances are restructured with the aim of returning the company to financial health and continued operations. IN those cases, everyone shares a little pain.
When a company goes Chapter 7 it is liquidated. End of story. Doors close, everybody goes home, sometimes with very little. At that point the Pension Benefit Guaranty Corporation (PBGC) -- a taxpayer-supported government agency -- takes over and pays retirees their benefits, sometimes at reduced levels.
Webb writes:
"Some shrug off large-scale economic and social dislocations as the inevitable byproducts of the "rough road of capitalism." Others claim that it's the fault of the worker or the public education system, that the average American is simply not up to the international challenge, that our education system fails us, or that our workers have become spoiled by old notions of corporate paternalism."
There's no doubt public education isn't producing what it should. Very few Americans pursue engineering. Very few become scientists.
While many US kids nail high scores on their SATs, there is a huge number who score low and a big number who don't bother to take the test. The reasons reflect societal, family and educational problems.
Meanwhile, it is absolutely true that workers came to expect corporate paternalism. But those days are over. And the reason they are over has little to do with the US. The reason is the rise of foreign competition. The other teams got very good and they caught up with us.
Webb writes:
"Furthermore, an unspoken insinuation seems to be inundating our national debate: Certain immigrant groups have the "right genetics" and thus are natural entrants to the "overclass," while others, as well as those who come from stock that has been here for 200 years and have not made it to the top, simply don't possess the necessary attributes."
Webb is right. Certain immigrant groups -- asians, most recently -- have shown they've got the right stuff. Stuyvesant High School was 50% Jewish, 40% white and 10% everybody else in 1970. Today it is 50% asian, 40% white and 10% everybody else.
But the asian population is about 10% of the NYC total. Today, due to hard work, asian students are flying high. Colleges have limited their enrollments because too many asian high-schoolers are doing so well that they could populate entire freshmen classes.
Best bet is to imitate the drive for success rather than complain about it.
reality writes:
"More troubling is this: If it remains unchecked, this bifurcation of opportunities and advantages along class lines has the potential to bring a period of political unrest."
In other words, you're threatening violence and revolution. Just like the subway panhandlers who issue a veiled threat when they tell you that giving them a buck will keep them from resuming a life of violent crime. Nonsense.
There's no permanent aristocracy in this country. There is, however, a growing number of affluent people who are living better than ever. And even less fortunate people are doing okay.
Meanwhile, routes to the top are wide open. But most require education. However, as long as students fail to learn WHY and HOW education is invaluable, we'll have plenty of nitwits wailing about a lack of opportunity.
And workers' ability to negotiate their futures has been eviscerated by the twin threats of modern corporate America: If they complain too loudly, their jobs might either be outsourced overseas or given to illegal immigrants.
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"Manufacturing jobs are disappearing. Many earned pension programs have collapsed in the wake of corporate "reorganization.""
Domestic Maufacturing jobs are disappearing -- for at least two reasons. One is productivity. It is not low wages that draw jobs from the US to other regions. It is productivity. Good workers in other countries do earn less than US workers. But most workers in other countries are not as productive as US workers.
If cheap wages were the key, the US would have moved all its manufacturing to Haiti years ago. But those workers aren't productive.
The other major reason is the cost of energy. Energy is very expensive in the US and adequate supplies are not always avaiable for manufacturers. Thus, they go elsewhere.
We can repair the energy problem easily. It is a political problem, not a supply problem.
As for Webb's claims about pensions, well, he's misleading. A "reorganization" is another term for bankruptcy. If a company submits to a Chapter 11 reorganization, the company and its finances are restructured with the aim of returning the company to financial health and continued operations. IN those cases, everyone shares a little pain.
When a company goes Chapter 7 it is liquidated. End of story. Doors close, everybody goes home, sometimes with very little. At that point the Pension Benefit Guaranty Corporation (PBGC) -- a taxpayer-supported government agency -- takes over and pays retirees their benefits, sometimes at reduced levels.
Webb writes:
"Some shrug off large-scale economic and social dislocations as the inevitable byproducts of the "rough road of capitalism." Others claim that it's the fault of the worker or the public education system, that the average American is simply not up to the international challenge, that our education system fails us, or that our workers have become spoiled by old notions of corporate paternalism."
There's no doubt public education isn't producing what it should. Very few Americans pursue engineering. Very few become scientists.
While many US kids nail high scores on their SATs, there is a huge number who score low and a big number who don't bother to take the test. The reasons reflect societal, family and educational problems.
Meanwhile, it is absolutely true that workers came to expect corporate paternalism. But those days are over. And the reason they are over has little to do with the US. The reason is the rise of foreign competition. The other teams got very good and they caught up with us.
Webb writes:
"Furthermore, an unspoken insinuation seems to be inundating our national debate: Certain immigrant groups have the "right genetics" and thus are natural entrants to the "overclass," while others, as well as those who come from stock that has been here for 200 years and have not made it to the top, simply don't possess the necessary attributes."
Webb is right. Certain immigrant groups -- asians, most recently -- have shown they've got the right stuff. Stuyvesant High School was 50% Jewish, 40% white and 10% everybody else in 1970. Today it is 50% asian, 40% white and 10% everybody else.
But the asian population is about 10% of the NYC total. Today, due to hard work, asian students are flying high. Colleges have limited their enrollments because too many asian high-schoolers are doing so well that they could populate entire freshmen classes.
Best bet is to imitate the drive for success rather than complain about it.
reality writes:
"More troubling is this: If it remains unchecked, this bifurcation of opportunities and advantages along class lines has the potential to bring a period of political unrest."
In other words, you're threatening violence and revolution. Just like the subway panhandlers who issue a veiled threat when they tell you that giving them a buck will keep them from resuming a life of violent crime. Nonsense.
There's no permanent aristocracy in this country. There is, however, a growing number of affluent people who are living better than ever. And even less fortunate people are doing okay.
Meanwhile, routes to the top are wide open. But most require education. However, as long as students fail to learn WHY and HOW education is invaluable, we'll have plenty of nitwits wailing about a lack of opportunity.
And workers' ability to negotiate their futures has been eviscerated by the twin threats of modern corporate America: If they complain too loudly, their jobs might either be outsourced overseas or given to illegal immigrants.
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