On Economic Inequality in America

Katrina vanden Heuvel, writing for The Nation:

By implying that there is a disconnect between inequality and opportunity, (many, not all) Democrats ignore the fact that opportunity cannot be provided as long as the economic and financial system is so unequal. Some, like Senator Elizabeth Warren, intuitively understand this. After all, she first came to Washington to battle a system that has long been rigged against the middle class, where working families' voices get overpowered by well-funded lobbyists who hold elected officials by the pocket. By creating an artificial division between inequality and opportunity, we turn a blind eye to this rampant unfairness that helped the 1 percent ascend to their economic perches in the first place. We also accept the built-in unfairness of the system as, simply, the way things are. Robert Borosage, co-director of the Campaign for America's Future, labels this flawed way of thinking "passive-voice populism." We assume that the ups and downs of the American middle class are as natural and as out-of-our-hands as the ebb and flow of the tides: economic inequality as an act of god. But, Borosage writes, "inequality didn't just happen to us. It wasn't inevitable. Just as the broad middle class was constructed brick by brick after World War II, the decline of that middle class was constructed policy-by-policy, step-by-step over the last three decades." Or, as Warren Buffett famously said in 2011, "[T]here's been class warfare going on for the last twenty years, and my class has won. We're the ones that have gotten our tax rates reduced dramatically." If we want to really create "opportunity" within our system, then we need to change the system. We need more than, as Borosage wrote today, "rhetorical pablum about lifting the middle class." A solution, he continues, "will involve taking on the rigged game and changing the rules. And that inevitably will require curbing Wall Street, taxing the wealthy and making vital public investments, closing the tax havens and dodges of the multinationals, requiring the Federal Reserve to favor a full employment economy for workers rather than an austerity regime for bankers, and much more." But, capitalism! Free market! The American Way!