My response to a question over at Thoughts from Kansas/Oakland: “What would you suggest are the causes of [the hardships faced by the 99%]?”
Well, LJJ [read LJJ’s comment here] already offered a couple examples upthread: Do you suppose that the owners of a battery factory are in the top 1%? Would you suppose that they are being further enriched by neglecting safety standards? Do you think this causes hardship for some in the 99%?
What about the bank worker who is required to do more work for less pay (specifically lack of overtime)? Who gets the hardship and who gets the benefit?
Someone made a lot of money off of sub-prime mortgages. I’m pretty sure most of them weren’t 99-percenters. But a lot of 99-percenters delayed their retirements — and thereby made it harder for kids to find jobs — because their retirement accounts tanked.
You know more about this than I do, presumably, if you’re teaching business (my own expertise is completely unrelated), but I have a suspicion if you honestly ask yourself what effect the corporations and their lobbyists have on the well-being of the average person in this country, you’ll see a lot of room for improvement.
I agree that the mere fact that someone makes a lot of money doesn’t mean that I’m any worse off — and I may even be better off if some of her spending comes my way. But I think we sometimes need to ask where that money’s coming from, and sometimes it is indeed coming out of your pocket, and my pocket, and especially out of the pockets of people who have a tougher lot than you or I.
When CEOs get big bonuses for laying people off and increasing the workload on the remaining workers, that money is coming from the people who are now unemployed and from the people who are working more for the same amount of money.
When corporations ship production overseas, the money they save doesn’t appear out of thin air — it’s taken from the people who lost their jobs.
Again, profit is not bad per se, and yes, improvements in efficiency are good, and yes, people in other countries deserve jobs too, and so on, and so on.
But do you really not see cases (indeed many cases) where the very same mechanism that produces wealth for the richest also increases the burdens on those less fortunate?
It seems to me that very fact that the wealthiest are getting much more wealthy, while the lower 99% are holding steady or getting worse off indicates quite clearly that this is happening pretty consistently.
And it’s hardly surprising, is it? With wealth comes the ability to make more wealth. When times have been tough for me, if I could borrow at all it was at an astronomical interest rate. When times are good, I get offers for dirt-cheap loans everywhere I turn.
If I buy my groceries with my platinum business credit card, I get a 3%-5% kick-back. Where does that money come from? Well, the grocery store pays the bank even more than that, so the bank makes money off of my using the card. Of course, the grocery store has to jack up the prices to cover that.
So now the bank makes money, and the store and I come close to breaking even (or maybe even come out ahead?), and who pays? Well, the guy who doesn’t have the credit score to get a kick-back credit card, because he has to pay the same grocery prices that I do.
The system is set up to make it look like free money. I get the money back from my card “for free.” The card issuer makes a killing (most banks have done pretty well lately, haven’t they?), because some clever business person figured out that they could jack up the fees they charge stores without anyone really complaining.
But that money isn’t really free. It’s costing my neighbor who buys his food with cash and can’t get credit.
And this is just one example. Multiply it by the hundreds or thousands of clever schemes that the rich and powerful have dreamed up, and it’s not surprising that the welfare of the general population is suffering while the richest are getting richer. In a way, how could it be otherwise?
So yes, I’m inclined to side with the occupy movement on this. I think we need some legislative action to help level the playing field to some degree.
I don’t have details. You can ask Josh for those.
[UPDATE: The Onion offers further details: All Of Area Man’s Hard Work Finally Pays Off For Employer.]