Stop being a compliant consumer. Face the ugly truth. Don’t get fooled by the stock market. Accept the need for the mistreated middle class to become the revolutionary class. The British military establishment's most prestigious think tank sees what too few over-consuming Americans are willing to anticipate. Unjustified and mounting economic inequality is planting the seeds for global economic conflict.
Here is what the new report from the UK Defense Ministry's Development, Concepts and Doctrine Centre warned might happen by 2035. "The middle classes could become a revolutionary class. The growing gap between themselves and a small number of highly visible super-rich individuals might fuel disillusion with meritocracy, while the growing urban under-classes are likely to pose an increasing threat...Faced by these twin challenges, the world's middle-classes might unite, using access to knowledge, resources and skills to shape transnational processes in their own class interest."
Consider the wisdom of economist John Maynard Keynes: The rich are tolerable only so long as their gains appear to bear some relation to roughly what they have contributed to society. Think of it as proportional and justified economic success. This can be tolerated by poor and middle class people if they believe the economic system is fair and properly rewards those who work harder or have better capabilities. But truly obscene economic rewards angers people. When most prosperity and wealth is unfairly channeled to relatively few Upper Class people, it is only a matter of time until fuming, resentful people in the Lower Class decide enough is enough and revolt. Perhaps violently, if the political system remains controlled by the Upper Class.
A ton of data demonstrate how crazy our economic system has become where a relatively few receive astronomical gains that no rational person could see as justified. One study tracked down home ownership data for 488 CEOs in the S&P 500 Index set of companies. The typical home of the CEOs has 12 rooms, sits on 5.37 acres, and carries a $3.1 million price-tag. Companies big enough to rate S&P 500 status hiked their median CEO pay by 23.78 percent in 2006 to $14.8 million. In comparison, U.S. worker weekly wages rose just 3.5 percent in 2006.
Despite what you hear about the sagging housing market and the
many people facing foreclosure, business at the top end of the U.S.
housing market is booming. Sales of homes in the $5 million-and-up
price range rose 11 percent last year, reports the Dallas-based
Institute for Luxury Home Marketing. Ten residential properties sold
for over $28 million in 2006. The most expensive in New Jersey sold for
$58 million; it went to Richard Kurtz, the CEO of Advanced Photonix, a
telecom supplier. In the “ultra-luxury market” a set of suites in New
York’s fabled Plaza Hotel was converted last year into one-bedroom
condos that start at $6.9 million.
From another study we learn
that pay for American college presidents over the past decade has
jumped seven times faster than pay for college faculty. In 1996, only
one college president took home over $500,000. In 2006, 112 college
presidents hit that mark. Meanwhile, after inflation, compensation for
college professors increased just 5 percent since 1996. And college
students have faced rapidly mounting tuition far higher than inflation
rates.
CEOs are getting away with economic murder. Bob Nardelli,
the CEO who departed Home Depot early this year, had an exit package
worth $210 million. IBM CEO Sam Palmisano took home $18.8 million in
2006 and will receive $34.9 million in deferred pay and $33.1 million
in retirement benefits when he leaves IBM. Even more extreme is the
case of Occidental Petroleum CEO Ray Irani. The interest income alone
on the $124 million that ended the year in Irani’s deferred-pay account
totaled $679,396. The Los Angeles Times estimated Irani's total
payoff for 2006 at $460 million. Leslie Blodgett, the top exec at
cosmetics giant Bare Escentuals, collected $118.9 million in 2006, with
most of that coming from the $117.7 million she cleared cashing out
stock options. She received 4 million additional stock options before
2006 ended.
Economists Emmanuel Saez of the University of
California at Berkeley and Thomas Piketty of the Paris School of
Economics found that the richest 10 percent of the U.S. population
received 44 percent of the pretax income in 2005. This was the highest
since the 1920s and 1930s (average: 44 percent) and much higher than
from 1945 to 1980 (average: 32 percent). With more than 140 million
U.S. workers, that top 10 percent equals 14 million workers. The bottom
half of that top 10 percent had incomes of about $110,000. That may not
seem all that high, except that the overwhelming majority of Americans
can never expect such income. And remember that many of these top 10
percent Americans are married to or living with equally highly paid
people.
When it comes to obscene economic inequality, however,
you must focus on the huge gains received by the richest 1 percent -
some 1.4 million people. Their share of pretax income has gradually
climbed from 8 percent in 1980 to 17 percent in 2005. Their average
income was $371,000. Who is in the top sliver of richness? Economists
Steven Kaplan and Joshua Rauh of the University of Chicago estimate
that there were about 18,000 lawyers, 15,000 corporate executives,
33,000 investment bankers (including hedge fund managers, venture
capitalists and private-equity investors) and 2,000 athletes who made
roughly $500,000 or more in 2004.
Do those at the top pay
their fair share of taxes? Middle class Americans, after nearly 30
years of tax-cutting, are now paying about the same share of their
incomes in federal taxes that they paid before Ronald Reagan entered
politics. In contrast, America's richest have seen the share of their
incomes that goes to federal taxes cut by over half. That what happens
in a failed democracy and the rich control the political system.
What
the future holds for the victimized middle class will not only depend
on the uncontrolled greed of the wealthy Upper Class and its control of
the political system. It will also be linked to the coming tsunami of
global warming impacts on climate, sea level, water supplies, crops and
disease. There will be devastating impacts on hundreds of millions and
perhaps billions of people worldwide. Lower Class people will be
sacrificed – left to suffer the consequences. The rich will retreat to
their walled, protected and well stocked havens.
Add to this
scenario the inevitable collapse of the entire economic system. At some
point it will not be controllable as it is now by those in banking and
finance, able to manipulate it to sustain economic injustice.
Eventually the inherent fundamental absurdities of the global economic
system will prove unsustainable. The wealthy Upper Class will have
siphoned off most of the world’s wealth and hoarded resources to
maintain a luxury lifestyle.
What the future holds: Lower Class
economic slaves fighting to survive in a medieval, ugly and bleak world
that so many science fiction stories have portrayed. In that hell their
best option will be to rise up and revolt against the rich and powerful
Upper Class. With such a prospect, global class war on a sick planet,
prevention is a priority. For us, that requires paying much more
attention now to economic inequality, economic injustice, economic
apartheid and the many attacks on the middle class. If not, we get
Economic Armageddon along with environmental disaster.
Opinion 
Stop being a compliant consumer. Face the ugly truth. Don’t get fooled by the stock market. Accept the need for the mistreated middle class to become the revolutionary class. The British military establishment's most prestigious think tank sees what too few over-consuming Americans are willing to anticipate. Unjustified and mounting economic inequality is planting the seeds for global economic conflict. 
Subscribe to this comment's feed
