Class Warfare and Status Quo
I've heard the voices of the wealthy sounding the tocsin, 'class warfare', at the first mention of more fairness in income distribution.
People both poor and rich see problems with the current economic status quo.
Before any theory of economy comes the desire not to see people suffer. Of course, it starts with self and family. When that is satisfied, it extends to neighbors, friends, and people seen on the street.
Is it class warfare to ask for a fair shake? Is it that all changes to the status quo are subject to charges of class warfare?
Let me answer my own question. Yes, all suggested changes are subject to the charges of class warfare. The call for an increase in the minimum wage could decrease the net income of some companies and their owners.
Is the fact that a suggestion has class warfare aspects automatically mean that changes should not be considered?
No. Why? Because the status quo is the result of battles in the past over distribution of wealth between classes. Why are those prior victories immune to analysis and correction now?
I am certainly not saying that everyone should have the exact same income. I think that the US system of wealth creation has worked pretty well, rewarding well those people who created products that many, many people wanted.
It's probably redundant of me to list the frailties and sins of capitalism run amok, since the recent financial crash and Great Recession, but 'pretty well' hides a seamy underbelly of 40 million without adequate insurance, many millions of minimum wage workers who themselves and their children cannot make full use of their potential, etc. And on the fetid topside of income inequality, we find some corporations hiding the dangers of their products for extra profit and certain leaders who risk their companies for their own immediate rewards, unconcerned about the general effect on the economy.
Although I have started with the minimum wage, which should be raised, that is not the real thrust of this post. We need to be aware that class warfare and slicing up the economic pie are just different ways of saying the same thing - and the way we slice up the pie today has not been blessed on high by God or by Adam Smith.
The allocation of income is just the way that a thousand little decisions have gotten us to where we are. Some of the decisions are legal, some are through contract negotiations, and many are political.
We should not reject suggested changes without giving the them at fair hearing.
The poor aren't the only ones who want changes to the status quo. Most state governments want to reign in pension and retiree health costs. What is that if not a change to the status quo?
I agree with the argument that political leaders will promise future benefits for current popularity, ignoring the cost of those benefits which do not come due in their term. There is not an easy solution, yet certainly one step must be to make state and local contracts with their employees based on longer-term economic reality rather than short-term political interests. I.e. elected officials should not lead those decisions; but they need to accept them.
And contracts already made should not be broken, but contracts with new workers should be made with terms that state can afford in their current financial conditions. Potential new employees can then decide - do they want to accept the lower retiree benefits, as a term of employment?
People both poor and rich see problems with the current economic status quo. Both sides are vulnerable to charges of class warfare. Both should resist waving that red flag which raises emotions without addressing issues.