Monday, December 12, 2016

WALL STREET CALLS OFF THE AMERICAN DREAM - Study on pay for young adults highlights plunge in US living standards



A Nation Commits Suicide

Study on pay for young adults highlights plunge in US living standards

Study on pay for young adults highlights plunge in US living standards

12 December 2016
A study released last week by a team of economists from 
Stanford, Harvard and the University of California at 
Berkeley found that the odds of American children growing 
up to earn more than their parents declined precipitously 
from 1970 to the present. Whereas in 1970, 92 percent of 30-
year-olds earned more than their parents did at a similar age, 
that number fell to 51 percent by 2014.

The figures for males were even worse. As of 2014, only 41 
percent of 30-year-old men earned more than their fathers at 
a similar age. The researchers also found that the decline in 
the ability of children to earn more than their parents was 
greatest in the Midwest, where decades of deindustrialization 
have had their most devastating social impact.
The economists concluded that even rapid economic growth 
would do little to reverse the downward trend because of the 
immense and ongoing growth of social inequality.
The authors of the study described their findings as a harsh 
verdict on the strength of what they called “the American 
dream.” In fact, their own findings add to a mass of social 
indices demonstrating that the much-vaunted but largely 
mythical “American dream” has turned into a nightmare. To 
the extent that this term, promoted to encourage illusions in 
American capitalism, ever corresponded to social reality, it 
was largely in connection with the belief that each young 
generation would enjoy a better standard of living than the 
one that preceded it.

Just last week, the federal Centers for Disease Control and 
Prevention (CDC) reported that overall life expectancy in the 
US declined for the first time in more than two decades in 
2015. The fall reflected rising death rates for a variety of 
diseases, an increase in unintentional injuries, accelerating 
suicide rates and an increase in infant mortality.

Earlier this year, a group of Harvard researchers reported that
 there was a 15-year life expectancy gap between men in the 
richest one percent of the population and those in the bottom 
one percent. Another reflection of the social crisis is the 
CDC’s finding that deaths from heroin overdoses surpassed 
gun homicides in 2015, while total annual deaths from all 
opioid overdoses quadrupled between 1999 and 2015.

The study on pay noted that the sharpest drop in the 
percentage of young adults earning more than their parents 
occurred from 1970 to about 1992—from 92 percent to 58 
percent. The percentage stabilized for about a decade and 
began to fall again beginning in 2002.

There is a direct correlation between this downward 
trajectory in living standards and the decay of American 
capitalism. The 1970s was the decade when the unraveling of 
the post-World War II economic boom and the erosion of the 
dominance of American industry found open expression in 
the collapse of the Bretton Woods monetary system in 1971 
and the growing share of global markets, including the US 
market, captured by rivals such as Germany and Japan.

At the end of the decade, the American ruling class initiated a 
major shift in its class policy, terminating the postwar period 
of relative class compromise and launching a class-war 
offensive aimed at breaking the militant resistance of the 
working class and reversing its previous social gains. A wave 
of plant closures and mass layoffs that began under the 
Democratic Carter administration was intensified under 
Reagan, who used the growth of unemployment along with 
union busting and wage cutting, made possible by the 
betrayals and collusion of the unions, to drive down working-
class living standards.

This ruling-class offensive has continued ever since, under 
Democratic no less than Republican administrations. The 
pace of decline in working-class living standards slowed 
somewhat in the 1990s, with Clinton presiding over a 
transient upward trend in economic growth based on the 
removal of virtually all restraints on financial speculation and 
parasitism. The resulting bubble imploded in 2000, 
fueling a new wave of mass layoffs and wage cutting under 
both the Bush and Obama administrations. This offensive was
 stepped up in response to the Wall Street crash of 2008.
It is this social catastrophe, rooted in the decline of American 
capitalism, that underlies the political crisis of both big-
business parties in the 2016 election and the victory of Trump
—the personification of the economic, political and moral 
decay of the American ruling class.

The election was dominated by the growth of popular anger 
and disgust with both parties and the political and economic 
status quo. The broad popular support, particularly among 
young people and workers, for the Democratic primary 
campaign of Bernie Sanders, who presented himself as a 
“socialist” opponent of the “billionaire class” and social 
inequality, reflected the initial stages of a movement of the 
working class to the left. Sanders worked to channel this 
opposition behind the Democratic Party, culminating in his 
endorsement of and campaign for Hillary Clinton.

Clinton’s campaign, the most right-wing in modern 
Democratic Party history, focused on scandalmongering 
against Trump and warmongering against Russia. She was
 broadly backed by Wall Street and the CIA and ran as the 
continuator of Obama’s supposed economic “recovery.” She 
utilized racial and gender politics to portray “white working 
class” support for Trump as motivated by racism and sexism 
and distract attention from the ongoing growth of social 
inequality and impoverishment of broad layers of working 

In an election where the two candidates vied for the 
distinction of being the most despised presidential 
contenders in US history, and the biggest bloc of voters were 
those who saw no reason to vote, Trump was given a free path
 by the Democrats and Sanders to exploit the economic 
grievances of workers and middle-class people whose living 
standards had been devastated by the policies of both parties.
Both the Obama administration and the Clinton election 
campaign were the outcome of nearly five decades, beginning 
at the end of the 1960s, during which the Democratic Party 
has repudiated any connection to policies of social reform and
 moved ever more sharply to the right.
It will not take long for workers, including those who voted 
for Trump, to realize that they have been taken for a ride and 
face in his administration the most ferocious enemy of the 
working class. His cabinet of billionaire reactionaries and 
warmongering generals already makes clear that his will be 
the most right-wing, anti-working class government in US 
Trump’s policies of social counterrevolution and war will do 
nothing to resolve the underlying crisis of American and 
world capitalism. They will only exacerbate the social crisis. 
The working class will face immense shocks in the coming 
months. It will move into struggle against a government that 
is preparing an unprecedented level of state repression in 
defense of the corporate-financial elite.

The interests and needs of the working class can find no 
expression within the existing political system. The defense 
of democratic and social rights must assume the conscious 
form of a socialist political movement of the working class 
against the capitalist system.

Niles Niemuth

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