Tuesday, June 15, 2010

"you don't get there by playing from the rule book. you stack the aces, you load the dice"

Guest blogger C on how the rich are getting richer and the poor are eating kraft dinner every night.

I actually liked the StephenGgordon article C is writing about, but I didn't love how he ended it:

"The extreme concentration of income to such a small number of high earners is unhealthy in a democracy. But a proper remedy must be based on a plausible theory of how high earners managed to acquire the bargaining power to extract such high salaries and to fend off tax increases. And we don't have one yet."

That just ain't true. There are plenty of theories about how racism and sexism, a society stratified by class, and a 'lean towards the rich' tax schema has led to the concentration of wealth in the hands of a very few privileged people.

There is actually a list of transnational corporations that owe taxes in canada--like, millions and millions of dollars in back taxes. They just don't pay and they don't get punished for it. Why? well that's what happens when corporate dudes and politician dudes are one in the same. They're family, they're married into the family, they're bros, they went to school together, whatever. When you've got someone scratching your back with gold plated fingernails you don't turn around and make them pay their backtaxes. Something like that is very obvious.

Anyways, on to the guest blog, which is very good:

"Stephen Gordon has a great opinion piece in the current issue of Canadian Business. In it he cites research from McMaster University’s Mike Veall revealing that top 0.5% of earners in Canada, those making greater than $250,000 per year, have somehow managed to increase their share of total income from 5.3% to 10.4% between 1982 and 2007. Put simply, this data reveals that the highest wage-earners in Canada have extracted 5.1% of the total income available to all Canadians from lower-wage brackets over the past two and a half decades.

I’m pleased to finally have hard proof that the rich continue to get richer in Canada while the poor and middle classes get poorer. A concept that older generations steadfastly deny is happening, likely because they’ve convinced themselves it couldn’t possibly have happened on their watch.

There have been several books published in the past decade or so talking about how the “rise of the creative class” or the “information technology revolution” has brought balance to the income classes of Western countries. “Experts” have been saying for years that with a certain amount digital savvy combined with an active imagination, anyone from anywhere can earn enough to live comfortably in Canada.

Of course, if you ask the millions of young adults in this country who still can’t afford the luxuries their parents already had at their age, like a home, a car or even a healthy meal every night of the week they’ll almost certainly call bullshit on the “information technology revolution”. Sure, they can operate a personal computer and find useful solutions to problems in the workplace but that doesn’t seem to be rocketing them up the corporate ladder like they were told it would.

The hard truth is that there’s only so much money circulating in any economy, which means there’s only so much money to be made. As long as older generations with old money continue to hoard their wealth, then younger folks won’t be able to increase their own wealth, regardless of how hard they work for it.

Governments will tell us that higher taxes levied on the rich, combined with more social programs for everyone else will ensure we all have access to the bare minimum. Aw shucks, thanks. In reality, the rich will always find clever new ways to evade taxes while taking advantage of social spending meant to assist lower classes.

Our employers will tell us if we work as hard as we can we will eventually be rewarded for it. If by “work hard” they mean day, night and weekend, and if by “reward” they mean our incomes will just barely keep up with inflation and cost of living increases, then this is absolutely true.

We’re only beginning to see a new class system emerging in developed economies. One that resulted from a massive population boom, that not surprisingly, turned public policy and economics in the favour of the greedy majority for as long as they’re alive, and likely even longer. Generations that follow this bubble, who knows how many, will pay for the insatiable appetites of the old and rich for decades to come. Furthermore, they may never gain access to the luxuries that those older generations still maintain they are absolutely entitled to.

My cynicism towards work and money are usually met with suggestions that I’m lazy and ungrateful, which is true, but why would I work my ass off trying to get ahead when it’s become all too obvious that I’ll never get back as much as I put in?"

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