Today I read an article about Leon Cooperman, the Wall Street billionaire who famously wrote a scathing letter to President Obama.
Since I come from a working-class background, and have enjoyed few economic privileges in my life, I am inclined to take the side of the poor and oppressed. I like to look at long term facts and figures and the fact that the middle class has been gradually shrinking since before I was born is deeply disturbing. After all, that’s the class to which my family belongs! What are things going to be like for my children and grandchildren?
While they were alive, I was able to discuss the Great Depression with my grandparents and great-grandparents so the memory of that period is very much alive in me. The men could not find work so the women did what they could in sweat shops or they worked as domestics in the homes of the wealthy. Grown siblings were forced to live in the same house along with their spouses, children and in-laws. There was no allowance; kids found whatever work they could and brought their meager earnings back home to help cover food and rent.
Despite the fact that the economic picture today looks very grim it is still a far cry from the level of deprivation our ancestors endured during the 1930’s.
Nevertheless, I find it deeply disturbing that the last few decades have seen a steady shrinking of the middle class and the growth of poverty while at the same time there is a small class of corporate leaders who have been experiencing personal financial growth unlike any that has been seen before. Is this healthy? Is this good? This trend has been going on for some 40 years so I think it is foolish to blame either Republican or Democrat leadership. If these trends continue, what is our country going to look like 40 years from now? The “Hunger Games?”
I am on a quest to find out the causes of these trends and to find solutions so that American can, once again, enjoy a robust middle class with good opportunities and prospects.
When we are struggling with joblessness, when the bank is forclosing on our homes, when we are saddled with debt we can never repay... it is tempting, it is easy, it is logical to resent those bankers and financiers who own multiple homes, private jets and off-shore savings accounts. After all, the numbers show that the wealth and prosperity is flowing steadily upward.
But I always like to look at both sides of the issue. I have personally known and I have worked with incredibly wealthy individuals. Some of them were the scions of old-money families. Others were nouveau riche. Strangely, each and every one of them panics about their bills and about the future just as much as everyone else I know. Many of them are providing for spoiled or clueless family members who have no hope of making it on their own. Many of them are involved in the roller-coaster ride that is Wall Street. For all their abundant assets, they are just as terrified of financial ruin as the single mother living paycheck to paycheck. So, I really have a hard time viewing CEO’s as a bunch of French aristocrats who laugh at the ignorant and destitute peasantry.
I found Cooperman’s letter intrigueing because I want to understand his psychology. Sure, we have some government social programs in the US but why are so many people afraid of “communism,” a “world government” and various boogey men that really come across as just yet another paranoid conspiracy theory. Because, that’s what I really believe it is. There is no vast socialist conspiracy to destroy capitalism in America. People just put those ideas out there to sell books and get TV interviews. Just like there is no vast right-wing conspiracy to force the American people to become submissive church-going peasants licking the shoes of their Armani-clad overlords. Again, sensationalism sells books and is good for TV ratings.
It’s time for the wealthy capitalists who control our corporations and who control Wall Street to let go of fear and make the effort to understand the masses. Likewise, it behooves the Occupy Movement and their sympathisers to understand the structure of our capitalism, both its sucesses and its flaws, so we can tweak the existing system for the benefit of everyone.
We really don’t have much of a class system in the US... yet. Cooperman comes from very humble beginnings. Like many of the nouveau riche he comes from a working-class family that largely benefited from the unions and from the social programs that have afforded some protections for the poor since FDR. Although he, his children and his grandchildren are fabulously wealthy and are likely to remain fabulously wealthy for many generations, I am certain that there are yet many working-class people in his family who are treading water.
We are a nation divided but those divisions are not conducive to bloody revolution. A class war will ultimately pit brother against brother, father against son, cousin against cousin. So how can mutual hatred possibly make any sense?
On the side of the capitalists, I think that they are aware of the swelling divide between rich and poor and I think it frightens them. I am sure that they feel powerless to change that trend; it is a force of nature larger than themselves or their bank accounts. They look upon the masses and, perhaps rightly, fear a Bolshevik-style revolution. Perhaps not in this generation, perhaps not even in the next but, if the pendulum does not swing the other way, it is very possible that a populist leader may channel the collective frustration of the unemployed and use it to turn our nation upon its head. So, caving to fear, it is natural that those who have the means are inclined to hoard as much wealth they can and hide it overseas as a form of insurance against such a calamity.
The working classes, too, are naturally frightened. You can borrow tens of thousands of dollars to get a college degree and still not find a job. If a family member needs cancer treatment or an organ transplant you take out a second mortgage on your home but then what if you can’t make the payments and the bank takes it away? The uncertainty and the fear are palpable. Meanwhile, the same company that laid you off, the same company that hasn’t given you a raise in ten years, is controlled by a handful of men whose bank accounts are surging. What’s not to envy? What’s not to resent? Our nation was founded by men who threw off the shackles of monarchy and their descendants are very capable of doing so again.
Are we all that different from one another? We’re all looking at the world and feel powerless. People have taken to the streets in Europe to protest austerity. Russia as devolved back into its Soviet-style totalitarian ways. The middle east is in even more chaos than ever before. Meanwhile, we nervously co-sign loans for our children to go to school and we anxiously hope that it’s money well spent. A man such as Cooperman things to himself, should I make that risky loan to that guy who wants to start a company or am I better off squirreling that money away in Switzerland?
The devotees of capitalism, in order to save capitalism, must relinquish their fear. Because, if you fear revolution then that fear will cause you to behave in such a way as to make the revolution inevitable. We must recognize that every sustainable system is a circle. It may be comforting to write off those public school teachers and those single moms because you don’t socialize with them but it is far more powerful to embrace them as fellow citizens and to indeed help them to find better solutions. Use your resources to find new and creative ways to build a more closely-knit society... not one where even brother schemes against brother on the way to reach the top.
Those of us who are struggling must realize that many of those who wield great wealth also come from humble beginnings. Many of them really do understand our struggles. In many ways, the existing laws and regulations restrict corporations and force CEO’s to make decisions even they find unpalatable. Let’s work together to build more sensible legislation. We need legislation that rewards corporations for creating jobs for Americans, not jobs in China. Let’s work together to create legislation that protects CEO’s when they show a loss next quarter because they need an extra year or two to turn that company around. Because the way the laws are now, if that CEO doesn’t lay you off then the shareholders are going to sue his pants off.
Each and every one of us, high and low, must put aside fear and prejudice. We must each make a commitment to stop scheming and hating and fighting. We have the power to stand together. Because when you and I stand together that will set the tone for the two parties to work together and when we learn to cooperate and to trust we will create a future far greater than any we could possibly imagine.