Reflections on an American system failure and the road ahead
In June of 2019, I wrote a paper for a public policy class on poverty and inequality in America. In it, I include a number of stark facts about our current economic system and its sweeping income inequality. For instance, did you know…
- The United States ranks last of the top 10 most well-developed countries in terms of labor markets, poverty, safety net, wealth inequality, and economic mobility, and 35th out of 37 OECD countries in terms of poverty and inequality
- The top 10% of American households control 50% of income and 76% of national wealth
- The bottom 80% of Americans own only 8% of stocks
- From 1999 to 2016, incomes decreased for the bottom 40% of earners, eroding to an average annual income of $12,943 for the bottom 20% of earners
- 57% of Americans don’t have enough cash to cover a $500 unexpected expense
- From 1973 to 2017, while workers’ productivity grew 77%, workers’ hourly pay only increased 12% (indicating gains are flowing disproportionately to the top)
- In 1973, CEOs’ average compensation was 30x the average worker’s; it is 271x today
It’s abhorrent that we, as a nation built on principles of justice, have allowed things to get this out of wack, this unjust, this imbalanced. What is worse, now that we have a true health and economic crisis on our hands, the house of cards that we have built is quickly crumbling before our eyes, and make no mistake, it will disproportionately devastate the poor. The turbulence that is headed our way is colossal, and the fact that our current presidential administration is a hot mess won’t help matters much, nor will our rigid media and social media silos which enable gross distortions and flat-out destructions of truth at the touch of a screen. A reckoning is upon us; people will suffer, thousands will die, fear and anxiety will increase, and many will urgently search for answers.
The most pressing question on my mind today is, where will we turn for solutions? Where will we go from here?
A few more facts, just to ground us in our current reality:
- As of April 8, 2020, 425,107 Americans had been infected by the Corona Virus, 14,262 had died; 81,766 are projected to die before we find a solution
- Black and Latino Americans are getting sick and dying from Corona Virus at disproportionate rates, likely due to 1) lower paying jobs that require physical labor in riskier conditions, 2) insufficient access to high-quality healthcare, 3) greater density of housing 4) higher rates of pre-existing conditions
- One third of U.S. apartment renters didn’t pay their rent in April (remember the $500 unexpected bill statistic?)
- 6.6 million Americans filed for unemployment last week; the highest number of initial claims filed in history
- Since 1981, trends show that each economic recession takes America longer to recover from
To recap, our American economic system was and is precariously imbalanced, with most Americans living paycheck to paycheck. We are currently incurring a systemic shock with the unprecedented shutdown of our economic system. Our presidential leadership is a masterful mess, and I have no doubt they will likely continue to flounder and muck things up, while also working to grab more power, stack more of the government’s branches with partisan loyalists while the country is distracted, and, in general, be bad at their jobs.
Friends and fellow Americans, it’s a hell of a time that we find ourselves in, and there really are no easy answers here, so let me digress with a very quick, seemingly unrelated story.
On October 8, 1871, disaster struck the City of Chicago in the form of a fire that burned for three days. On Wednesday, October 11, the day after the fire was extinguished and with the wake of its destruction laid bare, the Chicago Tribune published a distinctive headline. “Cheer Up,” it read. “We will rebuild.”
I love that. I am, and forever will be, an eternal optimist, and I have nothing but faith in the people of my country and our capacity to restore and rebuild. Things are pretty abysmal right now, and I am unflinching in my recognition of all that is broken; however, rather than blame scapegoats, utter half-truths, or distract from reality, I vote in favor of addressing our challenges head on with all of our power and grit. We must unite against the common foe that each generation faces in its new and ever-cleverer forms. In short, we must kick in the teeth of injustice. We must rebuild.
The list I’ve outlined below are my broad strokes, back-of-the-envelope ideas for a new American society that I’d like to co-create with y’all.
- First, we must address our current health crisis with a massive investment in equipment for hospitals and by tactically executing on a clear national plan built by pandemic professionals. We need to put money and resources to ensure our hospitals have what they need today and execute on a proactive plan to prevent the illness from spreading further, not to mention long-term planning for potential future pandemics. Furthermore, any Governor who is not promoting social distancing and issuing lock-down orders should be given the democratic boot. Science is real. Data is real. People are dying. In the words of Governor Pritzker, “Get your $#*@ together.”
- We need to be bold in our efforts to reform our national healthcare system and heed Senator Sanders' and Senator Warren’s clarion call to have the courage to stand up to healthcare and corporate insurance executives who benefit from the status quo. To be fair, these folks are not villains (“It is difficult to get a man to understand something, when his salary depends upon his not understanding it”), but their incentives are not aligned with the broader public, and things can be better. Look at most other developed countries’ health outcomes and costs. If they can do it, we can do it. Also, things are going to look even worse when healthcare premiums jump 40% next year.
- To do anything related to number two (and much more), we need to get “dark money” out of politics and ensure that companies cannot launder political funds through super PACs that then more-or-less buy local and national elections. The Citizens United ruling is one of our democracy’s open wounds. Let’s mend it.
- Promote all programs to increase voter registration and representation amongst the electorate, especially historically marginalized and disenfranchised groups. We will be a safer, more secure nation when everyone is safer and more secure, so it makes sense that we should listen to the ideas and voices of those who are least safe and least secure, am I right? Moreover, this aligns with our founding principles, so there’s that.
- Vote Donald Trump and his menagerie of goons out of office. I imagine this entire list of ideas would be anathema to them; all the more reason to democratically show them the door.
- Reconfigure the tax code to ensure a more progressive distribution of wealth. Collaborate with other nations so that corporations can’t swindle national governments with complex tax avoidance techniques, even if they have clever names. (Double Irish with a Dutch sandwich, anyone?) With that said, don’t go crazy with taxes. Incentives matter and economically successful people should be able to keep reasonable portions of the surplus they authentically create. Laffer Curve, my friends.
- Make WiFi a public good, like gas or electricity. Everyone should have it. I care more about the millions of U.S. children in poverty who cannot continue to learn via online classrooms than my Internet provider’s profits. Again, provide these firms with a reasonable rate of return for their services (like electricity, gas, etc.), but give our people the basic toolkit they need to thrive in the 21st century.
- Address massive gaps in the “gig economy” and make sure that big tech companies like Uber, Airbnb, et al. pay workers a living wage, including health and benefits. They aren’t scrappy startups anymore, and they need to start making leading contributions to societal surplus, not skirting their responsibilities.
- Address the emerging system of power tied to big data. Large companies harness their access to immense data sets and monetize insights for the economic benefit of a select few. We need legislation to address this, to ensure higher degrees of data privacy for individuals, and to make certain that society at large benefits from the vast wealth created by data mining.
- Invest in physical infrastructure. Some of our bridges, roads, and trains are unsafe. Fix them.
- Invest in teachers, schools, enrichment programs, and counseling. If stay-at-home orders have taught us anything, it is the incredible challenge of great teaching. Let’s reward our teachers and school leaders with compensation that rivals consulting and tech, and let’s make sure our children have the complete suite of resources needed to thrive.
- Keep investing in green technologies and address global warming through aggressive policies to keep the planet cool. It’s the only one we have, and if we can lock down the entire country for a virus killing thousands, we can certainly take aggressive steps to ensure the planet does not physically destroy us all.
- Criminal justice reform, let’s do that too. Our jails are filled with human beings who are doing hard time for less than hard crime, again an issue disproportionately impacting black and Latino Americans due to our unceasing legacy of racism. Let’s get those Americans back into society, educated, with jobs, voting, etc.
- Implement a thoughtful immigration system. Stop detaining and separating children and families. Ensure high-skill labor can cut through the red tape to work here and pay taxes.
- Pass common sense gun control legislation to ensure that we keep guns out of the hands of maniacs intent on killing other humans.
In sum, we are in a terrible mess, there is a lot that we need to do, but we cannot dig out if we are divided. We need to see each other as fellow Americans again. We are a people who have inspired the world for generations with our founding principles of freedom, justice, and the right to pursue happiness. We don’t always hit the mark, and we’re certainly not doing a great job on all fronts today, but we have so much potential, if we can only figure out a way to stack hands again.
America, I believe in you. I love you. And as soon as I pay off my six figures of student debt, I aspire to use my life, my energy, and my career to serve you.
Here’s to the journey ahead.
Footnotes:
Disclaimer: Opinions expressed are solely my own. If you disagree, I'd love to have a conversation. Feel free to comment or reach out on Facebook. Be well, my friends.
Comments
Thank you for writing it.
Best,
Rapha