Epic battles of blogger history: Occupy wall street and the 53%

A bit of battle has broken out in cyber space. The supporters of the “occupy wall street” group have established a site called “we are the 99%”, a reference to the fact that 99% of US voters hold but a fraction of the wealth held by the remaining 1%. The site allows people to upload messages in support of their cause and express their grievances with the current status quo. Opposing them is the “we are the 53%”, referring to the 53% of Americans who are taxpayers. This site represents the views of conservative bloggers, tea partiers and others who seem to think the OWS lot should get off their asses and go get a job. Here’s one of their posts (taken from the Beeb site):

“My wife and I decided in 1996 that we were sick of poverty. We went back to school. We earned degrees. We got jobs. No one handed it to us. We earned it. We did it. I didn’t go through all that struggle while raising 5 children so I could support lazy [expletive] people who want nothing but government handouts. You want to ‘occupy’ something? Occupy a job and start contributing”

Let’s pick this one apart. Going back to school (I assume he means university) would require money, lots of money, particularly in America. How exactly is someone on minimum wage, barely earning enough to pay the rent supposed to find the tens of thousands it would take to go to university? And how’s an unemployed disabled military veteran supposed to “earn it?” Crawl around until someone gives him a well paid job? Getting a bank loan to start up a business (or to pay for university)? You’re kidding right! The only way the many Americans who now live in poverty (never mind the now legions of homeless people in the country) could get money out of a bank involves the use of a firearm and a balaclava. I’ve heard of university professors being turned down for credit, so there are no guarantees anymore that anyone will get it. One cannot “occupy a job” if there are no jobs available.

What the “we are the 53%” lot need to realise is that times have changed. They did well for themselves in the boom years of the early 2000’s when the world was awash with cheap credit (read money that we’ve just worked out never existed in the first place) but were now in the mists of “the Bush depression”. Many Americans are seriously struggling. Homeless rates in America have soared. Tent cities or “bushvilles” as I’ll call them are springing up everywhere. Many of their occupants were “middle class” until 2007. Even those who are still working and have a place to live are seriously struggling to make ends meet. Indeed I would note that I’m in the process of moving house right now and remember noting that every single ad I saw for flats stated that (and the first question I was asking when I rang up) they would not rent to anyone who was unemployed (regardless of how much savings you had or if you were in a position to meet rent payments without a guaranteed). In essence if you don’t have a job, then you’re scum and among the great unwashed seem to be the message. One cannot pull themselves up by their boot straps if they can’t afford boots!

In essence much of the “we are the 53%” or indeed Tea Party politics in general amounts to saying is well I’m doing okay why should I change? Because a few twists of fate and you’ll be in the same boat as many others. Simple question to the Tea Party member if you lost you’re job tomorrow, how long before you’d be homeless? And to be fair let’s also apply the provisos to this question that you have to continue to pay all you’re bills and taxes (cos if you don’t pay them you’re not the 53% anymore!), can’t rely on any government handouts (since Tea partiers want “big government off our backs”) nor the bank of Mum and Dad (hardly pulling yourself up if mum & dad bankrolled you, indeed I should include a condition that you repay them for all you’ve got off em, if we’re to be faithful to the Tea Party philosophy). This a good question because there are three realities we all need to face, especially anyone in America (which lacks the welfare safety net of Europe). Firstly, it’s that many people today are only a few pay cheques from destitution and secondly that nobody’s job (or savings or pension plan) is secure in the current climate. If you’re a public sector worker, austerity measures could see you’re job going. If you’re private sector, such austerity measures are already causing a deepening recession here in Europe and what’s the first thing corporations do when a recession strikes? Thirdly, if you do wind up unemployed, there’s no guarantee you’ll get another job. I know people (with degrees or post-grad qualifications and tons of experience) who’ve been unemployed for a year or more (some since 2007) and despite all of their best efforts they still haven’t found anything (some haven’t even gotten an interview!), even after they traded down and went looking for less well paid posts (employers tend to come out then and say you’re overqualified and fear you’ll jump ship once conditions improve, been in this same boat myself!).

Incidentally, as I pointed out in prior posts (see here and here), if the Tea Party had their way and “big government got off America’s back” it would be mostly republicans who’d bare the brunt of that, due to the fact that many republican states take in more money from Uncle Sam than they pay out in taxes! Also its worth remembering that many “self made” members of the so-called 53%/Tea Party owe their success to a “big government” policies (low taxes & interest rates, high deficit spending, the wall street bailout) under the Bush adm. If they we’re true to their principles well they could at least write out Uncle sam a cheque?

I also suspect that this “we are the 53%” may contain an element of astroturfing at work. I found it suspicious when I went on the site how a disproportionate number of the pictures I saw seemed to be of attractive young girls. This blogger seems to think something’s up and Sourcewatch draws a connection between the principle initiator of this site (Erik Eriksson) the Rightroots and the Swiftboaters plus it establishes various connections to shady conservative/republican organisations.

Once we accept all of the above we also have agree that the unbridled greed of Wall Street is about as acceptable in the current climate as an Archbishop at a Tea Party convention. One criticism of the “occupy wall street” group is a lack of decent policies, other than a general down with this sort of thing attitude. Let’s try and sort that one out and suggest a few policies.

The idea of a Tobin tax or as its also called Robin Hood tax or Financial Transaction tax (its technical name) seems to be doing the rounds. I have to say that I believe that this is clearly insufficient; not least because just such a measure is now being championed by Sharkozy and Merkel right now (note to Americans it may surprise you to learn this but both of these politicians are actually right wingers!). While I certainly think it’s a good idea, it would knock Goldman Sachs off their throne (see my thoughts on that here). But no, I would argue that, while supportive of it, this would be little more than a band-aid on a severed limb in the current climate, especially given that it looks like the spiv’s and speculators on Wall Street may be limbering up to profit from the Greek default.

Firstly I would call for a loosing of libel laws to allow firms to try and recoup some of the bonuses that were paid out to the top bankers in the lead up to the recession. Take the former head of RBS here in Scotland, Fre>:XX actually hold up, I can’t name him as I think there’s still a super-injunction out preventing that, I’ll refer to him therefore as Scottish Holder of Indebted Titles :>>. Anyway despite wrecking his company he’s walked away with a £703,000 a year pension. Indeed it would appear that our Mr Banker was a bit of a Bonker, as he was busy sha&$ing some floozy in HR while the bank collapsed around him. Consider a friend of mine who owned shares in RBS. Unfortunately he was abroad when the balloon went up and his shares in the bank are now worth pennies. Is it fair that our Bonker profits at the expense of shareholders who got shafted? And of course we the taxpayer had to bail him out. I would argue that no, shareholders and RBS are within their rights to recoup their losses from the idiot. Indeed the state is entitled to its pound of flesh off of him too. Similarly if we can claw back the bonuses from the ghoul’s gallery of wall street that would send a clear signal to future generations of investors what will happen if they screw up.

I’ve previously discussed the benefits of some form of a PATRIOT Tax (Providing Appropriate Tax Requirements In Our Time) on the super-rich to help states out of the current crisis. I called it a PATRIOT tax because if the super rich were the true patriots they often claim to be surely they would be happy to help rescue they’re country from danger by opening their cheque books? If not then why does Glenn Beck hate America so much?

But I would also propose some form of Carbon tax. This would expose two politicians with the same brown envelope ;). It would raise revenue to solve current woes and encourage the transition towards a carbon free economy. I would favour the gradual integration of a carbon tax with general VAT taxes. This would moderate VAT rates based on the carbon footprint of a product or activity. Thus products with a low carbon impact would pay relatively little VAT, while those with higher impacts would pay more VAT. This would turn current economics on its head and create strong financial incentives for companies and individuals to go green. Furthermore while this current crisis would require such taxes to be paid into state coffers, longer term, post-crisis such money would instead be paid into a “Green Bank” that would lend or grant money to major renewable and Green energy infrastructure projects.

Many talk about raising the minimum wage, I would instead argue instead in favour of a maximum wage (means the wage of the boss is linked to the wage of the lowest paid worker, so a boss can’t earn more than say 20 times the guy who cleans his office). This would have many positive benefits. It would prevent the absurd and excessive wages that many of the MOTU currently command. Try and ask a CEO about his outrageous salary these days and he’ll say oh! I don’t decide salaries, that’s the board of directors, why they said that if I didn’t take it they’d beat me up after school and steal my pencil case (see Bob Diamond interview on the Today program here). It would also lead to some useful scenarios. For example let’s suppose a boss tells the unions he needs to cut salaries by 10% so he’s going to lay off X number of workers. The unions come to him and say, no it’s okay nobody’s loosing their jobs, they’ve had a meeting and all the staff agreed to take a 10% pay cut. No, wait! The boss says, actually we don’t need to cut wages by 10% (if the union followed through on that threat the salary of the boss would also fall by 10%), indeed I’ve “found” a few million (behind the sofa one assumes!) and am planning to put them up by 10% instead!

While many on the left would call for the scraping of bonuses I would argue in favour of them, but I would include a further condition – that all such bonuses can only be paid in the form of shares in the company. Shares than cannot be sold for many decades. If the company grows long term our high flyer will profit handsomely, indeed he’d be better off than under current cash bonus systems (as shares tend to out perform all other long term investments). However, if the company instead went through a spectacular rise only to then crash and burn (like so many banks did recently), then our high flyer would stand to loose everything.

If there’s one reality Americans need to face, its that the “American dream”, where one could arrive off a boat at Ellis Island with a small suitcase and through shear hard work you could eventually become a billionaire, is well and truly dead. We could argue all day about whether it was always a myth to begin with, but it certainly does not hold true today. Most immigrants to America wind up employed in jobs too low paid or too dangerous for Americans to do. And the only way one can succeed in America now is through shear blind luck (win the lottery or become a celebrity of sorts and cash in) or by virtue of being a member of the Plutocratic elite already. America, if not global capitalism in general, has become a massive poverty trap which many find it impossible to escape.


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