Elizabeth Warren is at it again spewing populist rhetoric that thousands, perhaps millions of people will “like” and why not, it all sounds so good and easy to believe; corporate executives and shareholders holders taking money from workers and thus holding down worker income.
The problem is that her rhetoric is misleading at best.
First, most people don’t even work for corporations and certainly not for corporations with overly paid executives so the majority of American workers are unaffected by “corporate greed.” There are only 500 large corporations in the US. Only 38% of workers are employed by large businesses.
Twenty-two million Americans are employed by government and another 1.4 million are in the military. Are corporate executives responsible for keeping their wages stagnant too⁉️ Should the federal government not have frozen pay during the recession or provided only a modest raise in 2014? Does old Liz believe government employee households are not part of the middle-class?
And about those stockholders; how many people do you know who believe their dividends are overly generous? If anything, the opposite is true, especially if you are using them as part of your retirement income.
Isn’t it interesting that the Administration is pushing more retirement investment while Warren slams the very source of that investment growth? In addition, who benefits from the growth in stock value? Anyone who owns stock or mutual funds, has a 401k plan or IRA or participates in a pension plan (mostly Union and government workers), that’s who‼️
Why do corporations pay what they do❓ Because they can. If you were running a business would you pay workers more than necessary to hire and retain a competent, productive workforce? The issue of stagnant income is very complicated (the recession, global competition, low inflation, declining Union jobs, misaligned skill sets, dysfunctional family units including the growth of single parent births, etc.).
Elizabeth Warren is dangerous because she seeks to solve problems by finding scapegoats and by promoting populist and simplistic non-solutions. Blaming others, populist rhetoric and finding scapegoats leads to other problems, just ask the Germans.
What is the danger of scapegoat ideology? I’m going to take a risk here and draw a parralell to another extreme. Ruslan Tsarni on CNN after his two nephews, Dzhokhar and Tamerlan Tsarnaev, were accused of the Boston Marathon bombing. They were just two “losers,” he said, who resented those who did better than them and dressed it up in ideology.” No, Americans are not losers, but all too many can be easily cajoled into the resentment of others who do better thereby giving increased power to the messenger.
How can the answer to growing the middle-class (which by the way is a dynamic population) be higher taxes on some and increased government transfers to others? That sounds more like an economic hospice. There is no real progress to recovery.
WASHINGTON — Sen. Elizabeth Warren (D-Mass.) and Rep. Elijah Cummings (D-Md.) are launching a series of events focusing on Democratic solutions to the woes of the middle class.
The “Middle Class Prosperity Project” starts Tuesday with a forum featuring prominent economists. On Monday, Warren and Cummings co-authored a USAToday op-ed describing a decline in middle-class prosperity since 1980.
“Beginning in the late 1970s, corporate executives and stockholders began taking greater shares of the gains. Productivity kept going up, but workers were left behind as wages stagnated,” Warren and Cummings write.“Families might have survived as their incomes flattened, except for one hard fact: the costs of basic needs like housing, education and child care exploded,” the op-ed continues. “Millions took on mountains of debt and young people began struggling to cling to the same economic rung as their parents.”
The Middle Class Prosperity Project, billed as an opportunity “to give a voice in Washington to those who need it most,” will first hear from a panel of economists including Jared Bernstein, Beth Ann Bovino, Joseph Stiglitz and Gerald Jaynes. The event is not a formal hearing of a congressional committee.
President Barack Obama, for his part, has been pushing a middle-class-themed agenda that includes higher taxes for the wealthy, a higher minimum wage and free community college. On Monday, the White House announced it would push a new rule to require investment brokers to act in the best interests of their clients.
Conventional wisdom used to hold that what’s good for General Motors is good for America. While GM may no longer be the poster child for corporate America, large corporations can afford lobbyists who make sure their clients are first in line when legislation is drafted. One of the justifications in protecting the interests of corporations first is the notion that they employ the vast majority of Americans and that corporate interests are necessarily aligned with most workers’.
But large businesses only employ about 38 percent of the private sector workforce while small businesses employ 53 percent of the workforce. In fact, over 99 percent of employing organizations are small businesses and more than 95 percent of these businesses have fewer than 10 employees. The reality is that most Americans are employed by a very small business that has little in common with the tiny sliver of the business demographic represented by corporate America. Huff Post Business
According to the U.S. Census Bureau, in March 2013, federal, state, and local governments employed 21.8 million people. There about another 1.4 million active military.
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