According to conservative philosophy, wages must be cut at the lower end of the economic spectrum so that profits can be maintained and expanded. When this happens, rich people will have more money to pump back into the economy to provide more jobs.
It’s a fine theory if you believe that people can survive making $7.25 an hour with no benefits or job protection, and somehow stay alive should rich people’s money disappear in stock market crashes.
If, on the other hand, you realize that keeping vast swathes of the population in a state of perpetual fear over their jobs, health and financial well being might be counterproductive, you might be inclined to change your economic philosophy. Neoliberalism has been so disastrous to the working poor, that 43% of the population have less than $10,000 upon retirement age. From CNN:
The percentage of workers who said they have less than $10,000 in
savings grew to 43% in 2010, from 39% in 2009, according to the
Employee Benefit Research Institute’s annual Retirement Confidence
Survey. That excludes the value of primary homes and defined-benefit
Workers who said they had less than $1,000 jumped to 27%, from 20% in 2009.
Statistics like these should be very, very scary to the US government. The complete economic disenfranchisement of that large a sector of the population has the potential to blow up very badly. The anger, frustration and resentment most people now feel at the system that promises the world but delivers peanuts can manifest itself in several different ways. On the one hand, people will turn to fringe right wing movements like the Tea Baggers, or they can join progressive causes that push for a much larger redistribution of wealth. It’s hard to tell which way the majority of people will go, but progressives should do as much as possible to educate the public on the real reasons why they have been cut out of society.
And it has nothing to do with not giving rich people more tax cuts.
Ben Cohen is the editor and founder of The Daily Banter. He lives in Washington DC where he does podcasts, teaches Martial Arts, and tries to be a good father. He would be extremely disturbed if you took him too seriously.