City on a Hill, Slum in the Valley


All through the fall, you could hear them chanting their glib platitudes, each candidate posturing as a champion of hardworking Americans. Now, as the country lists toward our season of mass consumption, you can listen to the publicans gravely intone the perils of the “fiscal cliff.” Or see the venality of double-tongued Congressmen who pose as social saviors, but aim a scythe at our safety nets. But behind the rhetorical swordplay you can just glimpse the neoliberal blueprint the hyperbole is designed to hide: the economic destruction of the state, which elegantly precedes—like a set of collapsing dominos—the decimation of the 99 percent for whom the state still offers meager sanctuary.

The formula is notorious: downsize government; privatize its assets and outsource its core functions; and simultaneously dismantle regulatory frameworks to free up speculative finance. The rhetorical euphemism is to clamor for the removal of barriers to free trade. When capitalists say this, the barrier is the state, and free trade is the exploitation of you and me. In one fell ideological swoop, the nation is strip-mined of its ecological patrimony, and the people fleeced by predatory finance and ubiquitous transaction fees. In the neoliberal game plan, only the one percent wins.

The dichotomy between the haves and the have nots is easy to spot—any economic index will lay it plain. On the one hand, abundance. On the other, want. The latter always proportionally dwarfs the former. Gated communities engulfed by shantytowns. Capital gains gurus floating on an ocean of debt peonage. Luxury towers peering out over pastures of cheap rental housing. But it is such a ubiquitous reality that it sometimes feels as though injustice itself is prosaic. We see the favela mudslide on page one, and it hardly registers as we swipe to page two. Indeed, no index better represents the impact of neoliberal reform that the income gap between top and bottom.

But who’s on the inside looking out and who’s on the outside looking in? That’s easy.

Insiders are white collar. They sit in cushy Aeron chairs in Goldman Sachs, where they turn government funds intended for loans into fresh derivatives and outsized bonuses. Insiders wear Hugo Boss shirts to their jobs at giant REITs, where they purchase huge chunks of our shadow housing inventory for pennies on the dollar. They pace corner suites in cloud-capped towers and build rate swap treasure chests and later petition Washington for sweetheart bailouts.

Insiders are unpatriotic. They take 3.5 million manufacturing jobs in a single decade and offshore them to low-wage countries with business-friendly labor laws—once called a “favorable business climate.” Any mix of despots and peasants will do. The products the proles produce are shipped off to high-dollar economies where addicted consumers overpay for them. Profits are quickly rerouted to offshore tax havens to avoid contributions to a tax base that would benefit outsiders.

Insiders are populist grandstanders. They pose on plywood platforms draped in the colors of hope and issue populist stump speeches to credulous voters. Insiders grease the political machinery of the status quo with lobbyist funds, guaranteeing the profits of faceless petroleum multinationals, depression-lifting pharmaceutical firms, and brokerages that portray retirement as one long globetrotting vacation for aging pair bonds. Even though these same firms have helped sink half the life savings of millions of Boomers.

When they speak, insiders counsel caution and advise against rash action. Insiders prefer the incremental and warn against making the perfect the enemy of the good. Insiders feel your pain, but pragmatically recognize the glacial pace of change. And now—thanks to the wonders of market innovation—insiders can digitally donate to the local food bank from the comfort of their Martha’s Vineyard porch, even as they peruse the timeless wisdom of Atlas Shrugged. Insiders are never all evil, but are rarely half good.

Insiders sit atop mountains of wealth. When they check their bank accounts, insiders find they own 42% of America’s wealth, even though they comprise just 1% of its population. Insiders also happily concede they gleaned 93% of our economic profits in 2010, capturing almost all the benefits of the stimulus. Heavily invested insiders are thrilled to report that the Dow Jones Industrial Average and Nasdaq Composite Index have nearly doubled since 2009. On the inside, things are getting better. On the inside, we are in the midst of a miraculous recovery that lines that frontings of Wall Street with boughs of holiday cheer as another calendar year closes with more record-setting Q4 profits.

While insiders get ahead, outsiders get by. Some of the time. Usually thanks to high debt, artificially inflated assets and longer working hours. What they didn’t inscribe at the foot of Lady Liberty was that once the huddled masses are welcomed into America, they mostly remain in their huddled mass. Upward mobility in America is the lowest among developed industrial nations. Less than 20% of us even own individual stock—those who do are mostly insiders, or outsiders who hope to build mountains out of financial molehills. Outsiders own 1% of America’s wealth, even though they are 50 times larger than that tiny tribe that owns nearly half of it. Fifty-seven million outsiders are out of food. Fifty million outsiders are out of money. Twenty-three million outsiders are outside the workplace. Ninety million outsiders spent this election outside the voting booth.

Some would quite fairly protest the existence of a third class, the middle class. But in neoliberal social order—as seen from its track record from Chile to Russia to South Africa—the middle class rapidly becomes indistinguishable from the lower orders. The trope of the taxi-driving economist is no lie. The undoing of the middle is well underway. Median household incomes—a barometer of the middle—have been declining for decades, and now hover below $50,000 a year. The middle’s share in our economic output has been in steep decline as well, and fewer households are earning those declining middle-class incomes.

At the same time, the cost of staple middle-class goods has skyrocketed. The cost of college. The cost of a home. The cost of healthcare. Once our most salient symbols of middle-class status, these goods have become debt collars that saddle the stressed finances of two-income families struggling to keep up appearances.

In a paradoxical neoliberal world, outsiders are driven further into dependency on the state, while insiders work to eliminate the state that serves the dependent. There’s now bipartisan agreement inside the beltway to slash hundreds of billions of dollars from the few services that keep outsiders afloat. The core bipartisanship consensus—that vile unanimity of the spineless and the soulless—is that the New Deal must be eviscerated to enable higher corporate profits. The day of our demise will surely be marked by record gains in the precincts of power.

Some day tourists may flock to America to take snapshots of the ruins of the New Deal, lying idle like some economic Acropolis, an empty architecture amid a farrago of urban destitution.

Jason Hirthler is a writer, strategist, and 15-year veteran of the corporate communications industry. He lives and works in New York City. He can be reached at jasonhirthler@gmail.com.

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