Advertise On EU-Digest

Anual Advertising Rates

5/17/16

Global versus US Economy: The Self-Indulgence of Prioritizing Income Equality While Ignoring US Militarism in the Era of Climate Change

Income inequality has been rising in the United States for the last forty years and has become especially drastic since 2008. This state of affairs is no accident. Since the late 1970’s, regardless of which party holds the White House, public policy has favored redistribution of wealth upwards through a variety of means including tax cuts, deregulation and, starting in 2008, simply handing out cash, in the case of the bank bail-outs.

Big money has always dominated US politics of course but its level of domination has grown to the point where government is now essentially a wholly-owned subsidiary of corporate power, specifically of the FIRE sector (Finance, Insurance and Real Estate). As David Rosen put it in CounterPunch: “Capitalism is evolving from an international system of nation states to a global system of financial plunder.”

Economist Michael Hudson echoes this sentiment, saying, “The Wall Street economy has taken over the economy and is draining it.” (For those interested in the details, Hudson explains the process very well in this interview with Gordon Long.)

Popular awareness of income inequality led to the popularity of both Bernie Sanders and Donald Trump in the US presidential race (but not of the many “third parties” who have long included it in their platform). Taking advantage of ground broken by the Occupy movement, Sanders explicitly drew attention to Wall Street. Trump spoke openly about how politicians are bought by wealthy people, pointing to his own personal experience as proof.

The media was forced to break its silence on topics it prefers to ignore. Now the reality of the richer getting richer and spending their lucre on political bribes can no longer be credibly denied.

But almost totally absent in discussions about how the economic pie has been divided is any acknowledgement of the nature of the pie itself. Where does it come from? The material and financial wealth of the United States is not produced without cost: it is extracted from the global environment in processes that require much suffering and destruction. Every dollar in the US economy represents exploited labor, degraded ecosystems and the viability of the future being sacrificed for profit in the present.

The US pie is 20% of the world’s resources being consumed by 5% of the world’s population. According to the Pew Research Center, “on a global scale, the vast majority of Americans are either upper-middle income or high income. And many Americans who are classified as ‘poor’ by the U.S. government would be middle income globally.”

Using data from the World Bank and the Luxembourg Income Study database, Pew notes that by world standards, only 2% of Americans are poor, 3% low income and 7% middle income. Fully 56% of the US population is in the top bracket, “high income,” with the remaining 32% being “upper middle.”

The Pew study adds that “the majority of Americans are part of the global high-income population that resides almost exclusively in Europe and North America. These two regions accounted for 87% of the global high-income population in 2011.”
Global Economics: The Self-Indulgence of Prioritizing Income Equality While Ignoring US Militarism in the Era of Climate Change

No comments: