Americans love the culture of inequality – it’s here to stay despite any revolutionary or enlightening discussions.
Despite the celebrated recent work of Piketty, “Capital: in the 21st century,” the opportunity for the United States to change or address inequality through policy is dismal. Prior to this much discussed New York Times best seller, Americans protested and demanded a change in the accountability of the financial sector and social protection systems. The most famous location of outrage was in the nation’s city with the highest income inequality, New York, at Zuccoti Park in the Financial District. After more than a month of a protest camp, this peaceful movement was disrupted by the police with a severe display of power. On the day of the crackdown, families, children and a great representation of average Americans, not just political activists from a range of beliefs, experienced a brutal repression, including the famed case of Cecily McMillan. Hundreds of officers armed with helicopters, guns and batons displayed an act of power to disband the park and forbid the congregation of individuals in that exact location. Since that momentous day, any act or attempt to voice contempt of the hugely unequal society in the USA is dismissed, ignored or responded with an angry defense of the current system.
Even more so, to question tax policy (and subliminally fiscal policy) is akin to treason for two reasons: historical prominence of taxation as a political issue and American cultural values.
Historically, taxation has always been a contentious issue for debate. At the birth of the revolution, “No taxation without representation,” was a major issue and rationale to separate from the British colonial system and it continues to be taught in elementary schools as an important reason to revolt. Fast forward to George Bush’s ill-fated quote, “Read my lips, no new taxes,” and the tea party’s mantra of low taxes, tax decreases are celebrated. Any discussion to raise taxes, even on the exuberant wealthy, is profoundly discouraged and feared. Even if taxes pay for needed and appreciated public goods like higher education or maintenance of infrastructure.
This sentiment was furthered during the Cold War. The war’s effects from propaganda have established fear of social expenditure by equivocating socialism to communism. The failure of the USSR is expressed as the reason why social spending will also fail. To provide individuals with free healthcare, quality education and free higher education is too close to communist objectives that failed. Redistribution by taxing the wealthy to fund social projects is seen as a terrible idea because it reflects communist ideals of redistribution. But also, taxing the rich does not respect the individualistic ideal that if you work hard, you will earn more. Even though social mobility in the USA has stagnated and is low compared to other developed nations, as evidenced by an OECD report, “A Family Affair: Intergenerational Social Mobility across OECD Countries,”
in 2010, Americans still believe in the immigrant dream. Furthermore, a report by the EPI, reveal that the the bottom fifth of the population works 3 times annual hours (number of weeks actually worked times number of average weekly hours) than the top 5% and work weekends significantly more than the top wage earners. This dispels the myth that if you work more, you will get paid more.
Culturally, America is a status oriented society. Hierarchy and respecting the roles within the organization is important from business to politics. No one wants to question their boss recognizing the power they have over their jobs. Furthermore, “climbing the ladder,” to get a higher paid more ‘respected’ position is encouraged and demanded upon individuals. Few are satisfied with their current positions and seek to upgrade. To reveal your status or position, Americans consume goods that reflect their income level or desired level. The brand of shoes, watches or purses are visually displayed to signify how much one paid for the good. The car we drive, the size of our home and how many homes or the location of our home are all items boasted about by Americans. The quality of our jobs, living conditions, or health is not the major concern for Americans because the culture conflates consumer goods with well-being. To be happy is to own or to be healthy is how much medical help you can buy. What we have is not enough and what makes us happy is only measured in terms of items.
Combining these two factors, inequality is encouraged. In one aspect, inequality is uplifted through the achievement of status where one must prove their VIP status and they must be part of a select group not available to all of society. In another channel, the tools used to redistribute income is despised and discouraged. Thus, there is no desire to change the levels of inequality and the few who would like to do something about this, have no political feasible tools to act upon. Americans love the culture of inequality – it’s here to stay despite any revolutionary or enlightening discussions.