[NYTr] Bob Herbert: Nightmare Before Christmas

[All the News That Doesn't Fit]

The New York Times - Dec 22, 2007
http://www.nytimes.com/2007/12/22/opinion/22herbert.html

Nightmare Before Christmas

By BOB HERBERT

Christmastime is bonus time on Wall Street, and the Gucci set has been
blessed with another record harvest.

Forget the turbulence in the financial markets and the subprime
debacle. Forget the dark clouds of a possible recession. Bloomberg News
tells us that the top securities firms are handing out nearly $38
billion in seasonal bonuses, the highest total ever.

But there’s a reason to temper the celebration, if only out of respect
for an old friend who’s not doing too well. Even as the Wall Streeters
are high-fiving and ordering up record shipments of Champagne and
caviar, the American dream is on life-support.

I had a conversation the other day with Andrew Stern, president of the
Service Employees International Union. He mentioned a poll of working
families that had shown that their belief in that mythical dream that
has sustained so many generations for so long is fading faster than
sunlight on a December afternoon.

The poll, conducted by Lake Research Partners for the Change to Win
labor federation, found that only 16 percent of respondents believed
that their children’s generation would be better off financially than
their own. While some respondents believed that the next generation
would fare roughly the same as this one, nearly 50 percent held the
exceedingly gloomy view that today’s children would be “worse off” when
the time comes for them to enter the world of work and raise their own
families.

That absence of optimism is positively un-American.

“These are parents who cannot see where the jobs of the future are that
will allow their kids to have a better life than they had,” said Mr.
Stern. “And they’re not wrong. That’s the problem.”

Record bonuses on Wall Street at a time when ordinary working Americans
are filled with anxiety about their economic future are signs that the
trickle-down phenomenon that was supposed to have benefited everyone
never happened.

The rich, boosted by the not-so-invisible hand of the corporate
ideologues in government, have done astonishingly well in recent
decades, while the rest of the population has tended to tread water
economically, or drown.

A study released last month by the Pew Charitable Trusts noted that
“for most Americans, seeing that one’s children are better off than
oneself is the essence of living the American dream.” But for the past
40 years, men in their 30s, prime family-raising age, have found it
difficult to outdistance their dads economically.

As the Pew study put it: “Earnings of men in their 30s have remained
surprisingly flat over the past four decades.” Family incomes have
improved during that time largely because of the wholesale entrance of
women into the work force.

For the very wealthy, of course, it’s been a different story. According
to the Congressional Budget Office, the after-tax income of the top 1
percent rose 228 percent from 1979 through 2005.

What seems to be happening now is that working Americans, and that
includes the middle class, have exhausted much of their capacity to
tread water. Wives and mothers are already working. Mortgages have been
refinanced and tremendous amounts of home equity drained. And families
have taken on debt loads — for cars, for college tuition, for medical
treatment — that would buckle the knees of the strongest pack animals.

According to Demos, a policy research group in New York, “American
families are using credit cards to bridge the gaps created by stagnant
wages and higher costs of living.” Americans owe nearly $900 billion on
their credit cards.

We’re running out of smoke and mirrors. The fundamental problem, the
problem that is destroying the dream, is the extreme inequality pounded
into the system by the corporate crowd and its handmaidens in
government.

As Mr. Stern said: “To me, the issue in America is not a question of
wealth or growth, it’s a question of distribution.”

When such an overwhelming portion of the economic benefits are skewed
toward a tiny portion of the population — as has happened in the U.S.
over the past few decades — it’s impossible for the society as a whole
not to suffer.

Americans work extremely hard and are amazingly productive. But without
the clout of a strong union movement, and arrayed against the mighty
power of the corporations and the federal government, they don’t
receive even a reasonably fair share of the economic benefits from
their hard work or productivity.

Instead of celebrating bonuses this Christmas season, too many American
workers are looking with dread toward 2008, worried about their rising
levels of debt, or whether they will be able to hang on to a job with
few or no benefits or how to tell their kids that they won’t be able to
help with the cost of college.

It’s not the stuff of which dreams are made.