| SHARED SACRIFICE THE JOURNAL OF PROGRESSIVE THOUGHT 29 JANUARY 2009 |
| RETHINKING ECONOMIC RIGHTS 29 January 2009 by Justin Racette |
As the depth of the economic downturn in the United States became apparent in
late 2008, many commentators in the mainstream media rushed to compare the
current situation with that which preceded the Great Depression. Pundits drew
similarities and distinctions between 1929 and 2008, and opinions varied as to
whether we were actually facing a second Depression or not. One similarity that
drew scant attention was the fact that income distribution in the United States is
now more disparate than at any time since right before the stock market crash of
1929. To be sure, some folks mentioned this factoid, but few examined its
implications for the faulty assumptions of mainstream economics, and fewer still
contemplated its ethical significance.
late 2008, many commentators in the mainstream media rushed to compare the
current situation with that which preceded the Great Depression. Pundits drew
similarities and distinctions between 1929 and 2008, and opinions varied as to
whether we were actually facing a second Depression or not. One similarity that
drew scant attention was the fact that income distribution in the United States is
now more disparate than at any time since right before the stock market crash of
1929. To be sure, some folks mentioned this factoid, but few examined its
implications for the faulty assumptions of mainstream economics, and fewer still
contemplated its ethical significance.
It’s this latter question that seems most pressing. Attempts to help us all to avoid repeating history may be noble, but millions of Americans
have been living in a depression for quite some time. The US is the wealthiest country in the world, and yet by almost every indicator it lags
behind most of the developed world in terms of standards of living. Amongst industrialized nations, the US has the second worst infant
mortality rate, the highest child poverty rate, the most people imprisoned (both in absolute terms and as a percentage of population) in the
entire world, and overall is among the worst in the developed world on the human poverty index. For a country as “prosperous” as the US
to leave so many millions of people in poverty is shameful. The cognitive dissonance created by such a wealthy nation leaving the basic
needs of so many people unmet is easily resolved when one realizes that about 70% of the wealth in the US is concentrated in the hands of
about 10% of its citizens. Decades of free market fundamentalism have widened the gap between the rich and the poor, culminating with
the vicious strain of unfettered capitalism promoted by the second Bush administration.
Although the paradox of a wealthy nation with so many poor citizens is easily resolved when confronted with the stark reality of income and
wealth distribution, there remains a profound ethical problem. Is it justifiable for so few to live in comfort and excess while so many live in
conditions that range from significant deprivation to abject poverty? In the abstract, this isn’t much of a dilemma - certainly it isn’t
acceptable for some people to go hungry, die of preventable diseases, and generally suffer from want while a handful of others manage
large fortunes. Even the most ardent free market fundamentalist doesn’t want anyone to suffer, unless he or she lacks a soul. The problem
for these folks is the myopic view that the only way to raise everyone’s standard of living is via the free market and that all alternatives are
tantamount to “communism,” which on this view is equivalent to the government infringing on your liberties by taking your stuff in order to
give it to someone else. For the market fundamentalist, having the uninhibited opportunity to grow one’s assets is worth the patient wait for
the market to alleviate the poverty of the masses.
Of course, the market isn’t alleviating the poverty of the masses. According to at least one recent study, the income of the bottom 90% of
the population decreased in 2005. Given recent economic developments, it is likely that the income gap has widened even more in the last
three years. The economic climate of the last decade has been one of brazen greed and self-aggrandizement on the part of a small
investor class to a degree difficult to fathom. Details of the financial chicanery that gave rise to the credit crisis underlying the current
economic downturn are just beginning to emerge. The free market has failed so spectacularly that Alan Greenspan, the former Federal
Reserve chairman who literally learned his brand of market fundamentalism directly from its intellectual godmother, Ayn Rand, and oversaw
the growth and bursts of two different economic bubbles, has recently conceded that “some of the critical pillars underlying market
competition arguably have failed” and that “the recent growing inequality of income...requires insight into its roots, and policy action where
appropriate.” Greenspan’s continued commitment to property rights and capitalism notwithstanding, the significance of this concession is
truly breathtaking.
To those of us who have been paying attention, Greenspan is clearly a bit late to the party. While he and his intellectual kin have been
repeating the mantra that we live in a land of equal opportunity where anyone can prosper with a little hard work, the rest of us have
watched as millions of working poor bust their humps every day and receive little in return. Hard work has gotten these folks only as far as
limited educational opportunities, no access to capital, and minimum wages will take them, which is next to nowhere. The mythical
entrepreneur pulling herself up by the bootstraps only exists in anecdotal terms at best. For years, the public has been battered with
absurd stereotypes such as Reagan’s “welfare queens” - the prevailing meme has been that those who are poor deserve it because they
are lazy. In reality, those who are poor are products of their material conditions. The market fundamentalists have always maintained that
basic needs such as adequate food and shelter, education, and health care are the incentives that the market relies upon to better
themselves. Progressives have known all along that these basic needs are instead prerequisites to self-improvement.
It remains to be seen what the Obama administration will do to try and pick up the pieces of the shattered American economy. The stimulus
package that has passed the House is comprised primarily of tax cuts, spending on public works projects, and entitlement spending.
Undoubtedly, some of these measures will provide relief to people who are suffering. However, it seems painfully obvious that unless we
adjust our beliefs about the role of the “market” in our society, we are doomed to repeat the cycle of boom/bust crisis capitalism that has left
millions in the lurch. The unwavering belief of this country’s leadership has been that the free market is the most efficient means of
allocating resources. As progressives, we need to constantly be reframing this question: For whom? The market has proven plenty
efficient at generating fabulous wealth for a privileged few while doing nothing for many. Even Alan Greenspan is coming around on this
point, but we must do everything we can to seize this moment to change public opinion about the “market’s” wisdom.
To that end, there is no time like the present to rethink the concept of economic rights. To his credit, President Obama unequivocally
proclaimed his belief that health care is a right in the debates preceding the election. However, the list of economic rights does not end
there. If we as a society agree that adequate food, shelter, education, and living wages are, at a minimum, essential to human
development, then these things ought to be fundamental rights. Franklin Roosevelt advocated an economic Bill of Rights 64 years ago. It’s
time to renew the push for positive rights. For too long conservative dogma has subordinated the material needs of individuals to abstract
negative rights. Only by placing economic rights on equal conceptual footing with liberty interests can progressives hope to effect
meaningful change in our economic practices. Economic stimulus is all well and good but equates to a $819 billion band-aid. Real
economic healing requires new thinking, or every so often we can expect to repeat inane historical debates about whether we’re heading for
another depression and all the while ignore the fact that for many Americans, the depression never ends.
Justin Racette is an attorney in Alaska.
have been living in a depression for quite some time. The US is the wealthiest country in the world, and yet by almost every indicator it lags
behind most of the developed world in terms of standards of living. Amongst industrialized nations, the US has the second worst infant
mortality rate, the highest child poverty rate, the most people imprisoned (both in absolute terms and as a percentage of population) in the
entire world, and overall is among the worst in the developed world on the human poverty index. For a country as “prosperous” as the US
to leave so many millions of people in poverty is shameful. The cognitive dissonance created by such a wealthy nation leaving the basic
needs of so many people unmet is easily resolved when one realizes that about 70% of the wealth in the US is concentrated in the hands of
about 10% of its citizens. Decades of free market fundamentalism have widened the gap between the rich and the poor, culminating with
the vicious strain of unfettered capitalism promoted by the second Bush administration.
Although the paradox of a wealthy nation with so many poor citizens is easily resolved when confronted with the stark reality of income and
wealth distribution, there remains a profound ethical problem. Is it justifiable for so few to live in comfort and excess while so many live in
conditions that range from significant deprivation to abject poverty? In the abstract, this isn’t much of a dilemma - certainly it isn’t
acceptable for some people to go hungry, die of preventable diseases, and generally suffer from want while a handful of others manage
large fortunes. Even the most ardent free market fundamentalist doesn’t want anyone to suffer, unless he or she lacks a soul. The problem
for these folks is the myopic view that the only way to raise everyone’s standard of living is via the free market and that all alternatives are
tantamount to “communism,” which on this view is equivalent to the government infringing on your liberties by taking your stuff in order to
give it to someone else. For the market fundamentalist, having the uninhibited opportunity to grow one’s assets is worth the patient wait for
the market to alleviate the poverty of the masses.
Of course, the market isn’t alleviating the poverty of the masses. According to at least one recent study, the income of the bottom 90% of
the population decreased in 2005. Given recent economic developments, it is likely that the income gap has widened even more in the last
three years. The economic climate of the last decade has been one of brazen greed and self-aggrandizement on the part of a small
investor class to a degree difficult to fathom. Details of the financial chicanery that gave rise to the credit crisis underlying the current
economic downturn are just beginning to emerge. The free market has failed so spectacularly that Alan Greenspan, the former Federal
Reserve chairman who literally learned his brand of market fundamentalism directly from its intellectual godmother, Ayn Rand, and oversaw
the growth and bursts of two different economic bubbles, has recently conceded that “some of the critical pillars underlying market
competition arguably have failed” and that “the recent growing inequality of income...requires insight into its roots, and policy action where
appropriate.” Greenspan’s continued commitment to property rights and capitalism notwithstanding, the significance of this concession is
truly breathtaking.
To those of us who have been paying attention, Greenspan is clearly a bit late to the party. While he and his intellectual kin have been
repeating the mantra that we live in a land of equal opportunity where anyone can prosper with a little hard work, the rest of us have
watched as millions of working poor bust their humps every day and receive little in return. Hard work has gotten these folks only as far as
limited educational opportunities, no access to capital, and minimum wages will take them, which is next to nowhere. The mythical
entrepreneur pulling herself up by the bootstraps only exists in anecdotal terms at best. For years, the public has been battered with
absurd stereotypes such as Reagan’s “welfare queens” - the prevailing meme has been that those who are poor deserve it because they
are lazy. In reality, those who are poor are products of their material conditions. The market fundamentalists have always maintained that
basic needs such as adequate food and shelter, education, and health care are the incentives that the market relies upon to better
themselves. Progressives have known all along that these basic needs are instead prerequisites to self-improvement.
It remains to be seen what the Obama administration will do to try and pick up the pieces of the shattered American economy. The stimulus
package that has passed the House is comprised primarily of tax cuts, spending on public works projects, and entitlement spending.
Undoubtedly, some of these measures will provide relief to people who are suffering. However, it seems painfully obvious that unless we
adjust our beliefs about the role of the “market” in our society, we are doomed to repeat the cycle of boom/bust crisis capitalism that has left
millions in the lurch. The unwavering belief of this country’s leadership has been that the free market is the most efficient means of
allocating resources. As progressives, we need to constantly be reframing this question: For whom? The market has proven plenty
efficient at generating fabulous wealth for a privileged few while doing nothing for many. Even Alan Greenspan is coming around on this
point, but we must do everything we can to seize this moment to change public opinion about the “market’s” wisdom.
To that end, there is no time like the present to rethink the concept of economic rights. To his credit, President Obama unequivocally
proclaimed his belief that health care is a right in the debates preceding the election. However, the list of economic rights does not end
there. If we as a society agree that adequate food, shelter, education, and living wages are, at a minimum, essential to human
development, then these things ought to be fundamental rights. Franklin Roosevelt advocated an economic Bill of Rights 64 years ago. It’s
time to renew the push for positive rights. For too long conservative dogma has subordinated the material needs of individuals to abstract
negative rights. Only by placing economic rights on equal conceptual footing with liberty interests can progressives hope to effect
meaningful change in our economic practices. Economic stimulus is all well and good but equates to a $819 billion band-aid. Real
economic healing requires new thinking, or every so often we can expect to repeat inane historical debates about whether we’re heading for
another depression and all the while ignore the fact that for many Americans, the depression never ends.
Justin Racette is an attorney in Alaska.
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