I think your assumption is that a 7% return cannot be realized without usury or nefarious terms somewhere in the market. While consistent with libertarianism, such a sentiment does live somewhere in the far reaches of the extreme of libertarianism. Furthermore, it stretches credibility to assert that Harvard's receipt of such return disqualifies it, and all those associated with it, from pursuing civil justice.

The bad old market seems capable of rendering any good a bad. Let's just outlaw all such money changers in our temple and go back to Agregaria to tend our flocks. Perhaps that is overly idealistic.

As for overcentralized power, I believe that the proposals do not shut out local political power. But the reality is that the money required to progress is not so evenly distributed today that all locales can simply tax and spend. Wealth concentration is very regional--even coastal. Without a federal collection mechanism that redistributes the tax revenue to the local governments, we've got a whole lot of talk and no results.

/c

In the blogosphere every one is an expert, so no one is an expert.

(From the standpoint of expertise I do not belong in this conversation but I do have an opinion so, with respect, here it is.)

Lyndon Johnson and Richard Nixon shared a common objective at the base of their respective domestic policy rational. Both Johnson (war on poverty) and Nixon (guaranteed income) had the goal of a stable society. With Reagan/Bush/Clinton/Bush that model of a stable society was abandoned in favor of the model of a field of competition. Perhaps it was a life-learned sensibility that allowed Johnson and Nixon to read the driest collection of economic data and still see a person, maybe someone from their own past, who knows. In the end it wasn’t just about numbers for either of them. No such sensibility informed/informs the perspective of R/B/C/B. In fact they all mock that sensibility with their denim trousers and televangelist stylings and their farms without farm animals. Intuitively it strikes me that John Edwards fits the Johnson/Nixon mold quite comfortably and that, for me, is all to the good..

Whatever the economic data, the question is essentially political. For Johnson/Nixon the middle class and poor were stages of economic progress, not static populations (teams) competing for some golden trophy and winners share of the purse. Today the theme of domestic policy is competition and its corollary that “No one remembers who took second place.” Competition as motif has an economic component but it informs behavior across the spectrum of human endeavor – competition for wealth, competition among social cliques (ethnic/regional/religious etc), competition for the authority of the truth, competition for power itself. As we have seen that competition can become so furious that all perspective is lost and political discourse spirals into the realm of the absurd.

The political question that underlies this debate over economic policy is the question of whether the voter of today will see their best future to be found in cooperation or competition. Each of the elements of domestic policy can be reduced to this formulation. Health care, employment security, financial stability and the rest all present the choice of shared or divided effort. Is the cost and availability of health care to be found in sharing the burden or competing for its benefits. Taiwan recently converted from a commercial medical delivery system to a government provided single payer system in ninety days. This is no abstract speculation on health care policy. It is as immediate as that.

Jack Kennedy famously said “Ask not what your country can do for you, ask what you can do for your country.” I think John Edwards more than any of the other Democratic candidates has chosen to challenge the R/B/C/B status quo and return us to the notion of shared duty. I hope he sees it this way and that he is successful.

I think your assumption is that a 7% return cannot be realized without usury or nefarious terms somewhere in the market.

just look at the federal debt! credit card debt! mortgage debt! bonds! student debt! etc... so today's bills are defered till tommorrow. so, instead of eradicating povery, we pass poverty (debt) to the next generation.

i.e., what people call profit is simply, in some ways, part of the debt that others took on. (i.e. I looked in my 401k and a good chunk of it is based on bank and investment stocks)

to solve the problem of debt, the government turns on their printing presses and prints out more money so people can pay off their debts. however, this causes the value of the dollar to go down and the working man/woman has less purchasing power and moves closer to poverty.

the powerful, however, are smart enough to know that the value of the dollar was adulterated and, thus, they use their power to demand higher salaries in order to maintain their standard of living and the wealth gap increases.

I think it's an extreme belief to think that regulations can control this power struggle.

The bad old market seems capable of rendering any good a bad.

we both agree on this. and we're definitely talking over each others heads about what's extreme and what isn't. beauty is in the eye of the beholder, as they say.

Without a federal collection mechanism that redistributes the tax revenue to the local governments, we've got a whole lot of talk and no results.

it seems like a shell game to me. if the IRS was abolished, as Ron Paul suggests, the states would become the primary tax collector and decide, locally, how to invest what they collect.

the problem of overproduction, which plagues farmers, and many other industries, is a hard one. the ethanol program, for example, seems to have no other benefit than dealing with the oversupply issue, at the expense of a lot of environmental damage.

To boldly go...

Ellizabeth--

Thanks for giving me the ammunition I needed to counter Bai!.

I completely agree with your analysis that helping the middle-class and poor need not be an either /or proposition. Certainly, today, as the middle-class faces more risk (of not having health insurance, for instance) we need to stress how the poor and the middle-class are often in the same boat.

Here I can't help but think about a comment on my post below where someone suggested that Edward's campaign slogan "Two Americas" is too divisive. He compared it to FDR's poverty-fighting slogan "Fair Deal" :

"'Fair deal'" worked; 'Two americas' does not. There may well be two americas, but to run a campaign on that theme . . . will fall flat."

If by "Two Americas," Edwards means "the poor" on the one hand and "the rest of us," on
the other hand, then I think his critic is right.
The phrase is divisive, and it's not going to encourage the middle-class to identify with the needs of the poor.

But if the "Two Americas" describes "most of us" (both the working class and the middle-class) on the one hand vs. "people who are so rich that they have abolutely no financial worries" on the other hand, then the slogan could help unite the poor and the middle-class.

But it's still very tricky. For one, Edwards needs to constantly make it clear that he recogizes that he is part of the other America--and would like to see more of us join him in feeling secure that our famlies will have the healthcare, education,etc., that they need.

There is also a question of tact. Many middle-class Americans don't like to be told that they have more in common with the poor than with the rich. It's so hard to discuss class in this country.

200% right! (I don't do math, so I can get away with saying this).

The scheme is as old as the hills--well as old as the end of Reconstruction in 1877.  Northern industrialists seeing abounding opportunities in the South quite deliberately used race to divide poor whites from ex-slaves, so that their mutual economic self-interest was hidden behind a screen race hate, and perhaps even more destructively, if that's imaginable, race fear.  I think we see the same trick happening now...make the middle fear the poor and make the middle and the poor fear the immigrant. We need healthy doses of Franklin and Roosevelt.  No trading of liberty for safety, and fear is the only thing of which we should be rightly afraid.

aMike

Correct me if I'm wrong, but isn't Edwards saying that there are two Americas, and that's a BAD thing?

Also, the GOP has been running on "our America" versus "their America" platforms for 27 years now, and has won 5 out of 7 elections.

Accumulating Peripherals

I'll table the market discussion. As for the ability for local government to raise tax revenues sufficient to cover their social costs, I just don't think the numbers add up. There is a long list of infrastructure that just couldn't have happened if left to the local government because of an inability to raise the necessary tax receipts. For example, rural electrification, interstate highways, and medicare/caid. Today Wyoming receives more federal dollars than they put in the federal coffer, whereas New York receives less than they contribute. I just do not see how sparsely populated states can raise the revenue required.

/c

In the blogosphere every one is an expert, so no one is an expert.

Your Vietnamese example contains something that does not apply here: a Japanese occupation-- the hardships were caused by an external source of oppression. In that situation Americans might show more solidarity too.

No analogy is perfect and certainly it is true that we had no occupation force. But we have had hungry people and actual starvation that led to food stamps available at no cost after the congressional hearings included the facts.

The difference is that the Vietnamese donated to the beggar as a fellow countryman. Here the poor might as well all be foreign invaders - actually many are.

The vast bulk of Americans have been identifying themselves as Middle Class since the 19th century. Given that working people like my father (a truck driver) long made mnddle class incomes this was not wholly inaccurate.

I disagree. Not about your father. :-) I have no idea what he thought.

In any case, it was only under Clinton that nobody below the relatively well off was apparently to be considered. Any mention of the poor was verboten by Democrats and denounced lustily by the like of Chris Matthews.

"Middle class values always sucked in my view whatever my income. Clinton made it "clear why."

I assume you are not talking about Clinton's affair with Monica

It would be nonsensical.

Middle class values have always been conservative.

Impetus for change has always come from the top and bottom.

Best, Terry

"That point is critical, Walker told a Senate committee last week, because the Social Security surplus will begin to shrink in 2009, as the baby boomers start to retire. It is it estimated that the fund will dry up completely in 2017. At that point, the nation's rosy fiscal picture will darken rapidly. Costs for entitlement programs -- Social Security, Medicaid and Medicare -- will explode. Without radical changes in tax policy and retirement spending, the deficit will make up more than 24 percent of the economy by 2050, Walker said." source

The stock market bubble was kind to everyone during the last few terms of clinton's presidency. The housing bubble, I believe-- based on what I read, started around 1995. And the social security fund rose and hid underlying spending.

When the stock market crashed in 2000, I've read that Bush used the taxcuts to bail out the rich who lost significant sums of money in the stock market.

As the boomers age, how the economy performs will be interesting to watch!

To boldly go...

Re: I disagree. Not about your father. :-) I have no idea what he thought.

I don't know how old you are (I'm just 40, not antique yet I hope), but when I was growing up working class people (at least in well-paying unionized jobs) definitely thought of themselves as middle class, and they tended to live in subdivisions with other middle class people (teachers, doctors, middle management types, university faculty, small business owners, policemen, etc. -- these were my neighboprs growing up).

Re: I disagree. Not about your father. :-) I have no idea what he thought.

Where were you in the 90s? The middle class did quite well for itself and I certainly never had the impression that the Clintions only favored the wealthy (though if you claim that the poor weren't much on their radar I might agree). That may have been true in the 80s with Reagan, and certainly true now, but the 90s were an oasis of propserity asnd peace for America and the great mass of its citizens. Even my working class friends were carping about too much overtime back then, not about layoffs and unpaid bills.

Re: Middle class values have always been conservative.

Not entirely. The middle class tends to produce the bulk of history's really fearsome radicals (Lenin, Cromwell, Robespierre, etc.) The rich don't need to be radical; they have it all. And the poor are too uneducated and powerless.

Re: Impetus for change has always come from the top and bottom.

See above. In general one must gain (seize, in some cases) power before one can effect change, so in that sense it is certainly true (tautologically so) that change comes from the top. It almost never comes from the bottom though: in all history there is exactly one instance of a revolution from below succeeding, that Haitian slave revolt in the 1790s.

What an intelligent discussion. Thank you for hosting such a forum.

I have been struggling my whole adult life with this issue. I am 60 now - and have come to reject the class containers. There are income demographics that define purchasing power. In a culture that puts purchasing power as the highest human value - "class warfare" is inevitible.

The growing problem is how purchasing power now affects the commmons resources that should be held as a fundamental human right. Clean air, clean water, to start, then a sustainable harvesting of renewable resources that feed, shelter and cloth us. Thus protection of the planet's ecosystem should be the highest law and priority.

When wealthy people like John Edwards build huge homes with acres of surrounding land they are using their purchasing power advantage. The real cost in long term resource depletion is passed on to future generations. The purchasing power of John Edwards does not take into consideration the real cost - only the relative advantage over the less wealthy at present.

As a nation the United States is depleting resources and destroying the planet's ecosystem in a way that future generations will find unforgiveable. Our way is clearly no longer the way to sustain a civilization.

Until we change our direction there will be continued breakdown into conflicts between demographic segments. We are no longer, if we ever were, a united people.

I find it interesting that our collective forgetfulness about our own past as a nation is a stumbling block in any discussions such as the one in this thread or any discussion of poverty and prosperity in America over the past century.

There are some things to keep in mind and remember when discussing all the things I see people mentioning above. One of them is that prior to the New Deal, the American middle class was a very small group indeed compared to today. So, essentially we had two America's prior to the New Deal. There were the priveleged and then there was the vast majority.

The birth of the modern middle class America we know it, is in no small part, and in my opinion primarily, a result of the anti-poverty programs and policies of the New Deal such as pro-union labor policies and laws like the NLRA, unemployment benefits, higher minimum wages, the social security program, WPA,and many others. These anti-poverty programs were butressed after World War II by other anti-poverty programs such as the GI Bill, Medicare/Medicaid, food stamps and others.

Most of us don't think of most of these programs as being anti-poverty programs but that is precisely what they were and what they are. They were programs that benefited large groups of people who did not have the financial means to achieve the ends the program was aimed at helping them achieve. They have been extraordinarily successfull programs to boot! Poverty among the elderly in particular is dramatically reduced from the levels we saw prior to the New Deal. We tend to think, however, of all these anti-poverty programs as being programs that benefitted the middle class when in fact it is more correct to say these programs created and sustain the middle class we have come to know and take for granted in this country. In a way, collectively, we have forgotten where we come from and why. This is a fundamental stumbling block for those who want to continue to fight poverty and build a stronger America than that which we have known.

Most Americans were poor prior to the New Deal. It was just that the vastness of the poor as a class allowed for many more grades of poverty and the incorrect perception that somehow the middle class as we know it is not a relatively recent phenomenon when it is. Most of those who rose out of poverty and solidly into the middle class were those in the upper strata of the poor hence all the family stories about how poor the family was that grandpa grew up in and how little they had--you know the kind I refer to I'm quite sure.

Many millions of us who have been the obvious and clear beneficiaries of those policies like to think that somehow our own families were in some way different and perhaps better or more deserving than poor families today and that is a big reason why our families got out while others were left behind. I submit that it just isn't true. The poor people of today are very like the poor people of yesteryear in character regardless of race, but they face an entirely different and far more daunting set of obstacles than our grandparents or their parents did. These obstacles and circumstances are something that few non-poor Americans know anything about and we have little appreciation of what it means to be poor in today's America, but if we did I can't help but to believe we would be compelled to act and to help and assist these people to escape their present situation.

The question of race and poverty is also a very interesting one vexed by our forgetfulness. There's no question that race has always played a factor in the past in terms of the perception of poverty and who benefits from poverty programs implemented by the government. But that is even more so in terms of how poverty has been perceived in the past 40 years or so.

The truth is and always has been that there are more poor whites than any other group of poor people. However, a false image of the poor has grown into and become fixed in the minds of most Americans (particularly since the election of 1968 and the "southern strategy") in a way that goes something like this: that most poor people are black, that most blacks are "on welfare", that most on "welfare" don't deserve the assistance and abuse what they get, and that they do nothing in return for the assistance they get even if they are deserving. The still existing range of prejudice from outright hatred to a smug sense of superiority on the part of whites toward blacks has been exploited by this line of thinking quite effectively to the benefit of the right and the Republican Party in particular.

It seems that the discussion of poverty was morphed by right wing effort, and media cooperation into an us vs them situation starting in the mid-1960's. Prior to that time, public debate on how to address problems of poverty was a problem commonly understood to impact many "good" and deserving people as well as the slovenly, unworthy poor that exist in the political myth described above. I believe this is in large part because you couldn't fool people who themselves were only 15-20 years out of poverty into thinking that the poor were only black people, the lazy and the ne'er do wells of society. You just couldn't pull the wool over the eyes of the previously poor who dominated the political landscape for decades. They knew what they had experienced, they knew well what they had seen with their own eyes and no right wing meme was going to fool them. The portrayal of the poor as mostly black, undeserving, lazy, etc... could take hold only when enough time had passed and people who came from families that benefited from the New Deal but who themselves never lived in poverty were far enough away from it to start believing that their family, their kind and so on were in some way "different" than today's poor. My own grandfather, born in 1911, put it more succinctly when he often commented about suburbanites voting Republican in the 1970's "They get six white shirts and think they're God Damn Republicans."

Sadly, the race factor is still quite potent in large part as a result of our continued segregation in America. Sure we've made lots of progress and all to the good, but we still live primarily in communities highly segregated on the basis of race. Genuinely integrated communities are rare in America. Thus many of us (in the aggregate) don't really know too many people who are not of the same race as we are, let alone poor people of any race. Partly because of this it is much easier to paint black people as "other" to many whites.

Bottom line though is that all of us need to remember what brought us all out of poverty and what things were like prior to our families escaping that fate. By doing so we must also remember that those left behind are no different but, in fact, just like us. The phrase, "There, but for the grace of God go I", should be present in all our minds every time the subject of poverty and what to do about it comes up. John Edwards is a good model for the vast majority of Americans in this regard. He leads on this issue, in my opinion, because he actually does remember where he comes from and what helped him escape over and above his own desire to make something of himself. Millions today, mired in poverty, work desperately to achieve much more modest success in life than that which Edwards achieved but are swatted down over and over because they do not have enough help to make it out despite all their toil and sacrifice.

As for me, I see it as our obligation to do all we can for everyone in poverty who needs and want help in escaping it without any stipulations. It is the right thing to do, but it also is the smart thing to do. Look at the vast dividends all our investments in anti-poverty programs have paid since the beginning of the New Deal. Look how much stronger we are in every way because of our efforts to lift up the poor. Has there ever been a better deal than that? I think not.

Re: along the way, treasury bonds, worth $2 trillion+, would have to be redeemed-- from the general budget.

Over that long a time period, 2 trillion is not that much. And those bonds have to be redeemed no matter what. And they will be,. America is a very rich nation, and need only tweak its publci finanaces to relieve its social security problems. As for Bush's pronoucnements, I doubt he said what you claim, but even if he did, so what? The man also told us there were WMDs in Iraq and complimented the FEMA chief on doing a great job in New Orleans.

I don't know how old you are

I have far outlived any usefulness.

I am very sensitive about it so I am sure you won't ask again. :-)

when I was growing up working class people (at least in well-paying unionized jobs) definitely thought of themselves as middle clas

When I was working in union jobs on construction and non-union jobs elsewhere, everybody I knew thought they were just working stiffs. Not one I ever met thought any different.

Some that sometimes made far less in white collar jobs thought more highly of themselves as well as their status.

Best, Terry

I suppose you are correct. Perhaps Clinton and Gore, not to mention the Republicans, are simply a product of their time.

the funny thing is the paradox! gore was pushing "personal accounts," if I remember correctly and based on what I read lately, personal accounts don't "protect your wealth, and let it to grow," as Bush would say but, instead, they act as ways to ration what you get. with social security, the public's expects cost of living increases, etc... with personal accounts, this sort of thing isn't be expected.

To boldly go...

I hope that's so! ;-) I'm sorry to hear about someone hacking you!

To boldly go...

John-
I agree--which is why I think it would be helpful for Edwards to characterize the two Americans as "the upper-class" (the top 20%) --and the rest of us (the lower 80%--which includes
everyone in the middle as well as the poor.

I recently saw an article by Clive Crook in The Atlantic where he described somebody making $750,000 as middle class. No, that ain't the middle.

Absolutely.  I've asked students of mine to define "middle class" in terms of income range at the beginning of each semester.  While none so far has gone as high as $750,000, they regularly place the ceiling of the middle in the $350,000 - $400,000 range.  There's a compulsion within them to define themselves in the middle.

aMike

Precisely one of the points I was making in my blog entry to which I linked.  The other point is implied.  Social class in common usage is self-assigned.  The delusion is in those who do the assigning, and it is hurtful.  If a person with treble the income defines himself to the same social class as the other person does, he becomes blind to the differences in opportunities and options available, and generally accepts his opportunities as a right and the lack of same in the other as a fault. 

aMike

aMike:

I went back and looked at your post about the "articulate" and "dexterous" working class. It reminds me of a summer, when I was still teaching, I spent working for a concrete contractor pouring foundations and walls. There was a core group of full-time staff who worked hard, drank a lot, made a lot of rude jokes - all in all fun to work with.

They put up with me as it was clear that they had an obvious physical edge. I refused to work up high and tried to make up for it with it hard work on the ground. I worked hard and got dirtier than anybody else. Like them, I also liked to drink beer at day's end. They seemed amused and treated me well.

There was another summer guy, Tom, about to enter grad school, that some of them hated because Tom violated the intraclass division between the macho dexterous and the (pick the adjective) articulate. They called Tom "Geraldo," with an H.

It's like weight lifting and gymnastics in a hot, dirty environment. To give some idea of what this work is like Tom (Geraldo), like the other full-timers, could stand on top of the new wall, which is 8-inches wide, lean over and pick up a form (about the size of a big door), turn on the top of the 8-inch wall, and hand the form to somebody on the other side of the wall.

On either side of the wall is a trench where the wall sets on the footings and the trench was usually 8 feet deep, but sometimes 12 or 16-feet deep.

Not all the "creters" resented Geraldo, a "quick learner." For some though, the versatility to enable him to successfully access both worlds was too unfair to tolerate.

Class is hard to define, but it is real. It starts early. We can feel it, and it is something bad we do to each other.

Amike,

Sorry for any misinterpretation.

In the past I have struggled with social class from the other end.

I made most of the money I needed to get through college working on construction in the summer. Wasn't easy getting a union card in the Laborer's Union. You had to know how to fight them. You also were not overly appreciated as a college kid.

One fellow that braved the cold successfully was a former teacher. I don't know why he was "former" but I do know he said he couldn't return. He had to be awful hard of hearing to succeed.

I got a bit of a kick out of the fellow who insisted his father, a truck driver, always considered himself middle class. Wouldn't have anyplace I worked.

As far as money, it took me many years after I left college to make as much money as I made working only part of the summer in menial job. Some with special skills made much more; e.g., powder monkeys who set the dynamite charges.

Unionization made the difference those days.

In truth, dividing people up by class is ruinous. It helps no one but politicians who feed on that sort of thing.

Best, Terry