Happy Wealth Day

This week brings us one more in a string of Labor Days with very little for labor to celebrate.

Over the past eight years, the federal minimum wage remained the same, and is now lower in real terms than it has been for 50 years. Over the same period, Congress has raised its own pay six times. In return for their steadily rising salary, members of the House will work from 91 to 94 days this year; Senators will work a whopping 121. One example of that “work” is Congress’s rejection of a bill that would have increased the minimum wage.

The bill was defeated due to a cynical ploy on the part of the majority party, who attached a permanent repeal of the estate tax to the bill containing the minimum wage increase. This tax repeal would cost the country $1 trillion over the next decade, and benefit the top two percent of the population. Even those Senators who strongly support an increase in the minimum wage were unwilling to tie this millstone around the necks of the American people, given an already gargantuan deficit that is pushing up interest rates, impairing housing activity and threatening economic growth.

The episode is, unfortunately, part of a national trend that increasingly devalues work and workers, while glorifying and aggrandizing the very wealthy. Since November 2001, when the latest recovery began, wages in real terms have actually fallen by one percent. As reported recently in The New York Times, real wages now comprise the smallest percentage of gross domestic product ever recorded, as compared to corporate profits, which have exploded to take the highest share since the 1960s. Even that may actually overstate workers’ earning power, since the measures of inflation have been rigged in ways that do not fully account for rises in the cost of housing and health care, which—in the real world as opposed to government-economist land—constitute the biggest problem for workers stuck with stagnant incomes.

Some argue that stock ownership is so broad nowadays that we all participate in the corporate profit boom. But the most recent data we could obtain for stock ownership, from 1998, showed that 78 percent of all stock value is in the hands of the richest 10 percent of the population. That leaves just enough for the rest to fool us into believing that it makes sense to sacrifice our interests as workers for the sake of our interests as stockholders.

The revolution that created this country was, in part, a rejection of a system of inherited wealth and power. Because this country was based on what people did and how hard they worked, as opposed to who their parents were and what they inherited, America was, for a couple of centuries, called “the land of opportunity.” Right now, all that seems to be slipping away.

The repeal of the estate tax is not the only attempt being made to promote the accumulation of wealth by the uber-rich at the expense of the middle class. According to New York Senator Charles Schumer, as reported in the article, “Schumer attacks wealthy individuals and businesses who avoid paying taxes,” in our August 10 edition, last year Sullivan County residents paid $62 million more than they would have had to if the very wealthy hadn’t found ways to shelter about $70 billion per year of their income from taxes. Yet the government is planning to cut the staff that oversees the tax returns of the wealthiest Americans by almost half. This, combined with the outsourcing of American jobs, big business’s protection of illegal immigrant labor and the ownership of the government and media by multinational corporations, is leaving the American worker further and further behind.

Capitalism is the most effective economic system going. And there is nothing wrong with a desire to accumulate wealth—something virtually all of us share. But when labor is denigrated in favor of wealth, something is out of balance. Rewards for ownership are essential to capitalism, but rewards for labor are equally essential. With an election coming up, it is time for the electorate to take a hard look at the candidates and figure out who understands this, and who is merely hoping to nose their way into a place at the lobbyists’ trough. Otherwise, we might as well stop pretending, rename the first Monday in September “Wealth Day,” and declare the American Revolution a failure.

Dr. Punnybone

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