Economic Inequality

Posted by: philipfontana | May 17, 2017

Economic Inequality

Economic Inequality

and the

Threat to Our Republic:

Economic Inequality to Political Inequality to Demagogue to Tyrant

Philip Fontana

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“Signing of the Constitution of the United States,” by Howard Chandler Christy, 1940, currently displayed in the House of Representatives wing in the Capitol building, Washington, D.C. (20 x 30 ft.). One of our most famous paintings depicts the meeting of the Constitutional Convention in Independence Hall, Philadelphia, September 17, 1787, at which the U.S. Constitution was signed. On the right side of the dais stands George Washington, president of the Convention. Seated, painting center, can be seen prominently Benjamin Franklin & Alexander Hamilton. The framers at the Convention envisioned a strong middle class to ground the republic.

“Excuse Us For Living” as a website has had more articles on the economy than any other topic. That is surprising in that I pride myself in not being “pigeon holed” and write on all sorts of topics. In fact, the very first post here, five plus years ago, was spawned out of a newspaper commentary I wrote, the essence of which said; “We’re not a bunch of greedy old Baby Boomers with our hands out collecting entitlements like Social Security, Medicare, and pensions. We’ve worked all our lives and it just happens to be our turn to retire.”

The last time I addressed the topic of economic inequality I was talking about Thomas Piketty’s book, Capitol in the Twenty-First Century, 2013. (To see that, go to the bottom of the right margin here and click on “National Economy” and then click on “Inequality” to go to the article.) To oversimplify and summarize, Piketty’s central thesis was as follows; inequality of wealth is not an accident, but rather a feature of capitalism, and can only be reversed through government intervention/politics/legislation. Needless-to-say, Piketty’s book shook and swept the economic and government scene into a frenzy.

Piketty’s book was the last monumental say on the subject until now; enter this spring a new book by Ganesh Sitaraman, The Crisis of the Middle-Class Constitution: Why Economic Inequality Threatens Our Republic, March 14, 2017, Alfred A. Knopf, at only 423 pages. Sitaraman brings Piketty’s “economic inequality as a feature of capitalism” home to America by arguing that a strong and sizable middle class is a prerequisite for America’s constitutional system.

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Ganesh Sitaraman’s new book, The Crisis of the Middle-Class Constitution: Why Economic Inequality Threatens Our Republic, published by Alfred A Knopf, March, 2017. Sitaraman’s book makes the case that a prosperous middle class is a necessity for American’s constitutional system to succeed. The author gives America a stark choice: “Will we accept rising economic inequality & risk oligarchy or will we rebuild the middle class & reclaim our republic?”

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Ganesh Sitaraman, author of The Crisis of the Middle-Class Constitution: Why Economic Inequality Threatens Our Republic, Harvard educated, is an associate professor of law, Vanderbilt Law School, & senior fellow at the Center for American Progress. He is longtime adviser to Senator Elizabeth Warren (D-MA). He has served as her policy director as well as her senior counsel. Sitaraman has published on foreign policy as well as domestic policy in numerous periodicals including The New York Times, The New Republic, The Boston Globe, & The Christian Science Monitor. He won the Palmer Prize for Civil Liberties in 2013 for his book, The Counterinsurgent’s Constitution: Law in the Age of Small Wars.

Ganesh Sitaraman’s book provides historical context to his thesis. He makes the case that throughout history civilizations from the Greeks forward were concerned about economic inequality leading to political inequality, instability, class warfare, and constitutional revolution. As a result, the great republics – – Rome, Florence, Venice, England – – had, what Sitaraman calls, “class warfare constitutions.” These governments designed different systems to prevent the clashing of rich and poor. The idea was to prevent “economic conflict” from becoming “constitutional revolution.” These governments took it as a “given” that inequality would exist and built in “checks.” They created various bodies within the government to represent the different classes of people. Balancing power was the objective to prevent one economic group from dominating. – – Simple example; England’s Parliament with the nobility in the House of Lords and the commoners in the House of Commons.

Enter the American Constitution. The author says that our Constitution is different in that it is not based on the assumption that class conflict is inevitable. He calls it “a middle-class constitution” which assumes “relative economic equality” with the middle class remaining dominant; the prerequisite of our republic! Sitaraman points out that the framers of the Constitution purposely adopted a design with no class distinction for the Senate or the House of Representatives, rich or poor. He explains that our founding fathers lived in a society of relative economic equality in contrast to Old World Europe. America offered available land to the west and with it economic opportunity.

The author does an admirable job marching through American history with countervailing developments that maintained the middle class. – – Jacksonian Democracy; abolishing property ownership to qualify for voting and dismantling the National Bank. – – Abraham Lincoln and the new Republican Party; ending slavery and the expansion of our class of free working people. My favorite examples start with the Populist and Progressive Eras of the late 19^th-early 20^th centuries to off-set the wealth of the Gilded Age. – – Think anti-trusts, progressive income tax, the Federal Reserve System, direct election of U.S. Senators, and social reforms from the Pure Food and Drug Act to child labor laws, and more. Naturally, FDR’s New Deal programs and economic legislation to counter the Great Depression are paramount examples, along with the GI Bill in post-World War II America, all building the middle class. He ends with LBJ’s Great Society programs; Medicare. Medicaid, and Head Start. For the middle class it was a society more equal economically than in generations.

Author Ganesh Sitaraman, having established the historical and political context, then goes for the jugular. – – The problem being that the foundation of our middle class constitution, “the prerequisite of relative economic equality,” is crumbling! Despite more than eight years having passed since the onslaught of the Great Recession, “disparities in economic power are at the forefront of popular debate.” Economic inequality is still on the rise with an increasing share of the wealth going to the top 1 percent and even more so for the top 0.1 percent of the people.

Concern then turns to economic inequality changing our system of governing into one of political inequality. “The system is rigged” to work for the wealthy and corporate interests, buying influence through campaign funding and “armies of lobbyists.” The result is outrage from both “the populist right” and “the progressive left.” (I hear Trump supporters and Bernie supporters!)

In conclusion, The Crisis of the Middle-Class Constitution ends with a cataclysmic warning. Clearly, rising inequality threatens America’s middle class republic. The wealthy will stop advocating policies that promote the common good and, rather, support policies that lead to their private benefit. This will lead to the wealthy thinking “they are inherently better than the poor and that they alone are worthy of the right to govern.” – – The result? Our republic will slowly and silently be transformed into an oligarchy. And then with no political recourse from the elites, people will turn to a demagogue. (Are we already there with Trump?) That leaves only one dangerous step left; the demagogue overthrows the government and we are left with a tyrant.

Excuse us for living, but Ganesh Sitaraman provides us with the historic underpinnings to understand the predicament we face today as a nation, as do people around the world as well facing economic inequality. History tells us it is time to find the means to re-establish and grow the middle class through some government mechanism(s) to correct the imbalance and redistribute wealth. We have done so in the past. We must do so once again.

Comments: Please!

Sources:

The Crisis of the Middle-Class Constitution, by Ganesh Sitaraman, Alfred A. Knopf, Mar, 2017

“When the Rich Get Richer,” by Angus Deaton, The New York Times Book Review, Mar, 2017

“How the Disappearing Middle Class Threatens Our Democracy,” by Kristen Miller, online “Moyers & Company,” March 24, 2017

“Can the American republic survive extreme economic inequality?” by James Pope, The Washington Post, April 7, 2017

“Can the Country Survive Without a Strong Middle Class?” by Rebecca J. Rosen, The Atlantic, March 21, 2017

Wikipedia online; factual content

Posted in Book Reviews, Commentary, History, National Economy, National Politics, News, Public Policy, Uncategorized | Tags: 1%, 99%, campaign finance, class warfare, demagogue, democracy, economic conflict, economic inequality, FDR, Founding Fathers, Ganesh Sitaraman, GI Bill, Gilded Age, Great Society, Head Start, Jacksonian Democracy, LBJ, Lincoln, lobbyists, Medicaid, Medicare, middle class, New Deal, oligarchy, political inequality, Populist Era, populist right, Progressive Era, progressive left, redistribute wealth, republic, Republican Party, revolution, rich vs middle class, rich vs poor, Sen. Elizabeth Warren, Thomas Picketty, Trump, tyranny, tyrant, U.S. Constitution, wealthy vs middle class

Responses

First, correct eight to eighty in this sentence. “Despite more than eight years having passed since the onslaught….” You can remove this comment if you wish. Marty
By: mvschulze on May 17, 2017
at 4:21 pm

Reply
- Mark, Thanks! Forgive my thick head but what does “Despite more than eight years having passed since the onslaught….” refer to??? Obviously that’s a line I wrote….but i haven’t found it! 8 to 80 years??? Please wake me up & tell me what you refer to! Thanks! Phil
  By: philipfontana on May 17, 2017
  at 5:24 pm
  
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  - My mistake, mis-reading “great recession” for “Great Depression! (Center of 4th paragraph from bottom) Marty
    By: mvschulze on May 17, 2017
    at 5:35 pm
- Mark!!!!!!!!!!!! I found it!!!!!!!!!!! It DID sound like me talking in that phrase!!!! If you reread that CLOSER, it says “Great Recession”…..The author refers to The Great Recession that started in 2008!!!!!!!!! He was not referring to the Great Depression! Ah, now I feel better. Great respect for all you say!!!!!!!!!!! Phil
  By: philipfontana on May 17, 2017
  at 5:37 pm
  
  Reply
- My mistake, mis-reading “great recession” for “Great Depression! (Center of 4th paragraph from bottom) Marty
  By: mvschulze on May 17, 2017
  at 5:37 pm
  
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  - Mark, You are fast! Just sent you an email with my reply above. I like to use caps as does the author to emphasize how bad The Great Recession of 2008 was with the obvious parallel to The Great Depression of EIGHTY YEARS AGO!!!! HA! Phil
    By: philipfontana on May 17, 2017
    at 5:42 pm
Inspiring post on what seems like a most timely insight to our contemporary politic. Having just finished Chernow’s “Alexander Hamilton” at some 800 pages (and being a relatively slow reader,) I none the less am intrigued enough to read Mr. Sitaraman’s book.
It is interesting also about he being a “longtime advisor to Sen. Elizabeth Warren…” in comparison to our current president who again and again seems to act independent of any credible advice. M 😦
By: mvschulze on May 17, 2017
at 4:36 pm

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- Marty, Very positive reaction to the book by you! Glad you might read Sitaraman’s book! I read Chernow’s “Hamilton” when it was published in 2004….I have a First Edition!!! Many thanks for the great comment! 8 to 80 years???? Phil
  By: philipfontana on May 17, 2017
  at 5:28 pm
  
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- Hi Philip and Marty,
  
  There is a really excellent article on Wikipedia about the various polarizations in the USA as a result of income inequality:
  https://en.wikipedia.org/wiki/Income_inequality_in_the_United_States
  
  According to Wikipedia:
  
  Plutocracy (Greek: πλοῦτος, ploutos, ‘wealth’ + κράτος, kratos, ‘rule’) or plutarchy, is a form of oligarchy and defines a society ruled or controlled by the small minority of the wealthiest citizens. The first known use of the term was in 1631. Unlike systems such as democracy, capitalism, socialism or anarchism, plutocracy is not rooted in an established political philosophy. The concept of plutocracy may be advocated by the wealthy classes of a society in an indirect or surreptitious fashion, though the term itself is almost always used in a pejorative sense.
  
  Usage
  The term plutocracy is generally used as a pejorative to describe or warn against an undesirable condition. Throughout history, political thinkers such as Winston Churchill, 19th-century French sociologist and historian Alexis de Tocqueville, 19th-century Spanish monarchist Juan Donoso Cortés and today Noam Chomsky have condemned plutocrats for ignoring their social responsibilities, using their power to serve their own purposes and thereby increasing poverty and nurturing class conflict, corrupting societies with greed and hedonism.
  
  Examples
  Historic examples of plutocracies include the Roman Empire, some city-states in Ancient Greece, the civilization of Carthage, the Italian city-states/merchant republics of Venice, Florence and Genoa, and the pre-World War II Empire of Japan (the zaibatsu). According to Noam Chomsky and Jimmy Carter, the modern day United States resembles a plutocracy, though with democratic forms.
  
  More from Wikipedia:
  
  Effects on democracy and society
  Economists Jared Bernstein and Paul Krugman have attacked the concentration of income as variously “unsustainable” and “incompatible”[98] with real democracy. American political scientists Jacob S. Hacker and Paul Pierson quote a warning by Greek-Roman historian Plutarch: “An imbalance between rich and poor is the oldest and most fatal ailment of all republics.” Some academic researchers have written that the US political system risks drifting towards a form of oligarchy, through the influence of corporations, the wealthy, and other special interest groups.
  
  Also from Wikipedia:
  
  United States
  Further information: Income inequality in the United States § Effects on democracy and society
  See also: American upper class and Wealth inequality in the United States
  
  Some modern historians, politicians, and economists argue that the United States was effectively plutocratic for at least part of the Gilded Age and Progressive Era periods between the end of the Civil War until the beginning of the Great Depression. President Theodore Roosevelt became known as the “trust-buster” for his aggressive use of United States antitrust law, through which he managed to break up such major combinations as the largest railroad and Standard Oil, the largest oil company. According to historian David Burton, “When it came to domestic political concerns, TR’s Bete Noire was the plutocracy.” In his autobiographical account of taking on monopolistic corporations as president, TR recounted
  
  …we had come to the stage where for our people what was needed was a real democracy; and of all forms of tyranny the least attractive and the most vulgar is the tyranny of mere wealth, the tyranny of a plutocracy.[19]
  By: SoundEagle on December 10, 2017
  at 1:28 am
  
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  - SoundEagle, Excellent excerpts from Wikipedia known to me content wise. Thanks for your interest & research. The end ing you quote is most meaningfully on point, “… of all forms of tyranny the least attractive and the most vulgar is the tyranny of mere wealth, the tyranny of a plutocracy.” The two greatest issues of our time are global; global warming & economic inequality. All other issues fall in line under these the greatest dangers & challenges of our time. Thanks you. You are a BIG thinker & a BIG talent!!! It is a honor to know you. Phil
    By: philipfontana on December 10, 2017
    at 10:05 am
  - Likewise! Thank you, Phil, for being so welcoming and friendly. 🙂
    
    My latest post at https://soundeagle.wordpress.com/2017/10/18/the-quotation-fallacy/ could be of great interest to you. Please enjoy!
    By: SoundEagle on December 10, 2017
    at 6:13 pm
Excuse Us for Living

“They say it is better to be poor and happy than rich and miserable, but how about a compromise like moderately rich and just moody?”—Diana, Princess of Wales

“As democracy is perfected, the office of president represents, more and more closely, the inner soul of the people. On some great and glorious day the plain folks of the land will reach their heart’s desire at last and the White House will be adorned by a downright moron.” — H. L. Mencken

Remember your Machiavelli? Three pure forms of government: monarchy, aristocracy, and democracy—all unstable. The flawed ideals degenerate to tyranny, oligarchy and licentious (corrupt culture of the entertainment industry, think “You’re Fired.”)

Air Force Corrupt has landed in America. A despot sits on a Floridian throne. Rip Van Winkle Republicans awake to The Make America Great Dictatorship. Economic inequality manifests civil war more destructive than nuclear detonation in the Far East. Incivility upon us, words unspeakable a few months ago, self-censored even if thought—Fenway Park begets Ferguson.

The Constitution was never middle-class economics, but ruling class bourgeois’ slavery prop for gentleman farmers. A document written by Mean White Men, aka White Men of Means.

Well done Phil, thoughtful essay, and another reason to be scared sh***less.
Charlie
By: Charles Puccia (@CarloBoston) on May 17, 2017
at 9:54 pm

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- Charles!!! Love the quote! How about “comfortable”!!! That’s all what we want, right?! And, I pray, we are there!
  H.L. Mencken’s prediction is here!!!
  Few people focus on all Machiavelli said about democracy & good rulers.
  Your 4th paragraph I don’t know where to begin! –It would take dissection!!!
  Ganesh Sitaraman’s “Middle-Class Constitution” makes sense in the context of world history & world governments & speaks to the American ideal of no aristocracy in our U.S. Constitution. He speaks relatively speaking about what the Founding Fathers created. Now he could do a better job in developing how our political system has been corrupted since then….but does so in effect by tracing the events in American history to counter wealth & advance the middle class.
  Great comments on this post, best so far! Thanks! And right, the book DOES give us “reason to be scared shitless!” Phil
  By: philipfontana on May 18, 2017
  at 10:31 am
  
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An interesting book! I can relate to the middle class in Indonesia that currently is growing and play part in forming the politics atmosphere. I wonder what makes the inequality even wider in the US? I will read the book and thank you for the review, Phil! It makes me want to read it myself!
By: Indah Susanti on May 24, 2017
at 9:59 pm

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- Indah! Great to hear from you! Indonesia & people all over the globe are affected. As the poor struggle to move up the economic ladder, it is more difficult to move up & into the middle class. And as they move up into the middle class as in Indonesia & around the world, political equality is expected but not as it should be. The wealthy look out for themselves & the interests of the middle class are neglected by the government. In the US the in equality is magnified by the amount of great wealth on the other end. The combination of wealthy investors on Wall Street, corporations, & lobbyists in Washington, D.C., dominate the agenda of our Congress & the people & their interests/needs like health care, jobs,climate change, infrastructure & so on are not represented properly by those elected to Congress. So good that you want to read this book!!!! Wish to hear how much more time you have left in the USA or that you are back in dear old Rotterdam!!! Thank you for being in touch! Phil
  By: philipfontana on May 25, 2017
  at 10:58 am
  
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Great piece as always Phil. I just have one opinion I think we are much closer to an oligarchy than people realize. As a member of Clergy the parish took very good care of me. However since the Great Recession I had to tighten my belt and take a pay cut just so the parish could survive. I now work a secular job as well as my vocation and it still is very hard to balance the books of the Tatro House each week.
By: Padre Tatro on May 29, 2017
at 7:15 pm

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Padre Tatro!!! Eddie, how great to have you “visit” me!!! Agreed, our Congress legislates more for the wealthier special interests than the common people…so that puts us into oligarchy territory! How sad that you as a pastor had to take a pay cut & work another job as well & still struggle financially. I guess Geri & I should be more thankful than we are for our financial state. We are not part of the wealthy but want not & have enjoyed much. Many of my educator colleagues retired have more income because husband & wife were educators & have TWO pensions & TWO with high Social Security. But Geri & I keep our tastes modest from cars to home & spending in general. As a result, our nest egg exceeds that of our friends. We also stay away from the stock market variable investments. We stay with lower interest on fixed investments. It has worked for us. And we do count our blessings. May God watch over you & wife Nicole. How did I ever miss that nuptial event???!!! Best to you both! Phil
By: philipfontana on May 29, 2017
at 8:52 pm

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Great post and thanks for all the likes on mine! Have a great day!
By: kkessler833 on March 4, 2018
at 4:17 pm

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- kkesslar833, KENDALL! How nice to see you here! Oh, this book by Ganesh Sitaraman, “The Crisis of the Middle-Class Constitution: Why Economic Inequality Threatens Our Republic”!!! Excellent on my favorite peeve, economic inequality, yet to be addressed BUT WIILL INEVITABLY!!! Yes, I went on a “Like” tear on your posts!!! Thanks! Phil
  By: philipfontana on March 4, 2018
  at 5:59 pm
  
  Reply
  - Thank you! I hope you are right! Things need to change!
    By: kkessler833 on March 4, 2018
    at 6:43 pm

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