American Inequality: Ticking Time Bomb

Inequality has been on everyone's lips from President Obama to Mayor DeBlasio, from the Wall Street Journal and New York Times to The Indypendent.

Which inequality? There are plenty to choose from, including gender, racial, income, and wealth though the one that resonates across the political spectrum is the inequality of opportunity.

Americans are more generally accepting of these higher degrees of income and wealth inequality because of their staunch faith that American society is more of a meritocracy than other countries.

This faith is woefully undermined by the data, which show that in America, who your parents were is far more important to your success than it is in other countries. Americans' acceptance of inequality is based on this misconception of American meritocracy -- on the false belief that America rewards those of sufficient ability and diligence more readily than other nations.

Most Americans want to believe that we live in a society in which an individual's success is mostly determined by his or her talent and effort and not by winning a birth lottery of inherited wealth and connections. In a true meritocracy, everyone, regardless of race, creed, economic background, or parents' education, has an equally fair shot at achieving his or her own greatness. America proudly points to example after example of this American dream -- from presidents who rose from humble beginnings to the self-made techno-billionaires who started their businesses in the garage.

This belief in American meritocracy has created the long-held perception of the United States as a "land of opportunity," the desired destination of countless immigrants over hundreds of years, many with dreams of political freedom, religious freedom, and economic opportunity. While it didn't take long for these immigrants to discover that the streets were not paved with gold, their children and grandchildren and the many who continue to come here still tend to believe that the U S meritocracy offers a greater opportunity to fulfill aspirations than other countries.

The reality falls far short. Extreme inequality -- of income, wealth, or anything else, for that matter -- undermines democracy. The concentration of a large portion of assets into the hands of a few has historically been associated with oppression. When wealth is thus aggregated, the wealthy tend to have overwhelming influence on the design of laws that then tilt the balance more and more in their favor. Thus favored, the moneyed classes are even more advantaged when it comes to amassing still more wealth and power, while opportunities for mobility become rarer

Democracy shaped by high income and wealth inequality becomes transformed into governments that seem more like aristocracies. In that scenario, the rich, empowered to direct policy from their gated communities, and the poor, struggling to pay the rent with their minimum wage service-sector McJobs, never meet across the vast disparity of wealth, power, and opportunity.

Inequality breeds instability. Two thousand years ago, Plutarch wrote that "an imbalance between rich and poor is the oldest and most fatal ailment of all republics," a statement proven time and again in history. If a highly unequal society is to be stable, the deprived majority needs to accept that the distribution of income, wealth, rights, and status is fair -- or that it is unchangeable. (Physical intimidation has often been used to "encourage" such acceptance and enforce stability.) If the deprived majority does not accept this, then political change is likely to ensue--maybe through a democratic process, maybe through violence. That is why nearly all political experts agree that the existence of extremely large centers of private power and wealth is a threat to the long-term viability of a democracy. The intermittent influence of America's own populist movements has shown how organized people can become an effective counterforce to organized wealth, shaking up the democracy and restoring it to a new level of stability.

Economic inequality could not have been more prominently displayed than in this disparity between the plight of most American taxpayers and the further enrichment, at the taxpayer's expense, of the elites who had helped create the 2007-08 financial crisis. Populist anger raged; politicians grandstanded in response. But nothing happened. Soon the populist anger dissipated, and the public focused on other issues.

One wonders if our nation must be pushed to the brink of self-destruction before it will implement change.

The existence of extremely large centers of private power and wealth is a threat to the long-term viability of American democracy, and the main effective counterforce to organized money is organized people.

The tools to address inequality are well known.

The barriers to using these tools, such as powerful entrenched self-interests, state repression, voter apathy, poor organization, and insufficient sustained action are also well known.

For America to change its course, Americans need to put down the remote, stop checking how many retweets and likes their latest quip received and get out in the streets.

Quotes from this post were taken from Howard Steven Friedman's Measure of a Nation