Destructive mythology of the ‘free market’

Over the last six weeks I have been doing phone banking for the primary election, working off a database of prospective voters which shows the approximate age, gender and party affiliation of all the voting members of the household.  The data point of that real-time demographic sampling that has stood out most sharply has been the large percentage of young people in their twenties and thirties who are living with their parents.

This has been a common anecdotal narrative about the aftermath of the Great Recession.  It is a fact. This is a natural and predictable effect of a shrinking consumer economy with diminished job security and the general downgrading of job quality in a very tight labor market. It is to the credit of both generations that they have mostly learned to live reasonably harmoniously together as adults.  It is really a sign of an underlying level of social and familial strength that should encourage us that the true American spirit of solidarity has not been crushed, even under strained economic circumstances.

One of the primary markers of social status in American society has been the establishment of one’s own household. That now is becoming a luxury item that can only be purchased by the top 10 percent. The patrimony of the Millennials is a necklace of debt, saddling them with a heavy burden right at the start of their lives, simply to complete their education and afford common consumer goods. The basic human cycle of birth, education, career, courtship and marriage, childrearing, wealth accumulation through home ownership, and finally the respite of a dignified retirement in old age has been interrupted. We have yet to see the whole of the cultural shocks that the demolition of the middle class will cause.

Even though the TV economists tell us that the catastrophic financial meltdown of the Great Recession is now ending, based on an uptick in stock valuations and home prices, the real economic data is telling us that something else more fundamental is happening.  The 150-year trajectory of rising incomes in America has been broken.  The vaunted American optimism for the future has run into an historical trend-line that we as a people are not psychologically prepared to deal with.  The next generation look to their elders for guidance and they get instead the threadbare dogma of the mythical “free market.”

I never cease to be amazed at the blinkered and deliberate lack of historical perspective, the raw coarseness and the sheer volume of the conservative ideological agit-prop churned out 24/7 by the Mighty Wurlitzer of the right-wing media machine.  The sum of their now tattered project is to try to whip up popular discontent (and political advantage), by inciting non-stop manufactured rage, designed to turn the disaster that befell us as a country due to the enactment of their policies into a political liability for the luckless crew that came in to do crisis management after the Crash. Like the quack that has only his patented magic snake oil to sell, their formula never changes: lower taxes, less regulation. No matter what ails us, we just need another stiff double shot of the same old bad medicine.  That’ll do the trick.

One of my least favorite conservative columnists, George Will, recently opined that what this country needs is the more of same remedy that The Gipper applied to the economy after the deep recession of 1982-3 (another self-inflicted wound based on voodoo economics and the laughable Laffer curve-based policies).  Bartender, I’d like another shot of ruinous upper-income tax cuts, and a second round of financial sector deregulation, while you’re at it. Will even rubs salt in the wound by snarkily declaring that: “But today’s Millennials have the consolation of having the president they wanted.”

This pernicious and bromidic prescription has become what Nobel economist Paul Krugman describes as a “zombie idea” that will not die, no matter how many times the real-world empirical outcome ends in disaster. My emblematic image for the triumph of conservative ideology is the photo-op of Reagan Administration officials gleefully ripping a chainsaw through a stack of New Deal era banking regulations. Oh, the irony, in hindsight. Sadly, this project became bipartisan. Centrist Democrats and conservative Republicans egged each other on. No, my fellow Americans, the ideal tax rate is not zero.  A sane regulatory regimen protects the commons that we all rely on for survival.  We have a civilization to run here. Wake up.

Why do these people still get any air time?  How many errors finally result in pundit disqualification?  Apparently, if you own the media platform, you don’t have to account for your record.  On a slow news day, they’ll just rev up their new favorite hobby horse, the Bullghazi Incident, run stock inflammatory segments about food stamp users, and bring on the neo-con handwringers worrying aloud peevishly that the U.S. is getting sand kicked in its face because we’re not starting another war somewhere in the world.  Day after day, like a hollow fury signifying nothing, the Fox News/Rush Limbaugh propaganda machine drones on, debasing our political discourse and stirring up paranoia, hatred, fear and loathing in the populace.  They prey upon the economic and cultural insecurities of the American white middle class and working class citizens, providing rhetorical piñatas and faux culture wars to distract them from the unpleasant and inconvenient fact that their corporate overlords have dumped them.

They can get labor cheaper all over the world.  When China, India and Brazil get too expensive, they will downshift to Vietnam, Bangladesh, or downtrodden Eastern European states.  The emerging international oligarchy has no loyalty to any nation state.  Capital is now global and highly fluid, and U.S. labor markets no longer claim the allegiance of traditionally American-based corporations. That was the seismic economic shift that occurred out of the Crash of 2008.

Large segments of the American work force have been rendered redundant. Their services are no longer required.  We haven’t come to terms yet with what that will mean for our future as a people. The social compact between labor and capital that generated the broad American middle class in post WWII America turns out to have been an historical anomaly.  The historical tendency of capitalism is towards a neo-feudal, Robber Baron type of plutonomy.  That is the actual statistical norm. This is the thesis of Thomas Picketty’s new best-selling masterwork, “Capital in the 21st Century”, which I will explicate in the July edition of The Sun.