Economics of Division

A Balance Approach

Balance (noun):  A state of equilibrium or equipoise; equal distribution of weight, amount, etc.

Each day is spent observing via the internet, Twitter, Facebook and blogs how Americans are behaving. Given the troubles of the past 3+ years it’s not surprise that we, on a whole, are deeply concerned about the future – on many levels. It’s also apparent that we are lacking balance in how we live, legislate and care for each other.

The causes and effects of that lack of balance are debated below, but first consider this as something I think we can all agree on….

Whether or not you believe in the creator or natures bold mistake in creating our planet, we might agree that the result is a beautiful and precarious balance between the forces of our solar system, our oceans, sky, earth and our planet’s inhabitants and our actions. Without that elegant balance life on Earth would not be possible. And within the construct of life on Earth, there is a need for a human balance in our relationship to the planet, our environment and each other.

The theme of balance takes in all things in my way of thinking. The problems and challenges we have in 2011 may be a result of those few among us who have gained the most from creating imbalances in nature, the economy and politics. From the distribution of wealth to natural resources, something is amiss.

Economic Balance

The first and most obvious place the imbalance is showing up over the past several years is in domestic and world economies. We are being told daily that “we” have problems and that “we” are struggling… we are out of balance. This comes as a bit of a surprise to me considering U.S. corporations have seen their stocks and profits soaring for over 2 years.

Fortune Magazine writes “Amazingly, as consumers struggle, U.S. corporations are staging a nearly unprecedented comeback that’s largely escaping notice.” and what is most significant is the fact the scale of the “unprecedented comeback”. According to the April 15, 2010 article “For 2009, the Fortune 500 lifted earnings 335%, to $391 billion, a $301 billion jump that’s the second largest in the list’s 56-year history”. And while that was happening average Americans, small businesses and retailers continued to suffer. WalMart climbed into the #1 position on the Fortune 500 surpassing Exxon while mom and pop retailers and service businesses are closing their doors. While we are witnessing these successes at the Fortune 500 corporate level, the average family is making less per capita according to 2010 U.S. Census Bureau statistics released in 2011 and are being expected to pick up a disproportionate share of the financial needs and burdens of our country.

The root of the problem is inequality within the tax code and the way opportunities are being presented by those who have had the best opportunities in education, medical care and business. We are being told by those without need how we should define our own needs. The prevailing conservative approach is that everyone has an equal opportunity for financial success – as if there is an unlimited supply of money and opportunity. This defies logic on so many levels, but the first is too obvious – money is a finite resource like everything else, and very few people control the vast majority of these resources. It’s like oil, diamonds or caviar – they are tightly controlled commodities controlled by an elite few, guaranteeing prices will remain high for the consumer.

Marshall Auerback writes about the dangers of this lack of balance and how it will lead to a worldwide food crisis, the repercussions of which will be more violence and even greater need in Naked Capitalism. Isn’t it in our best interests to seek a balance between need and want?

“It is a signal advantage of taxes on articles of consumption, that they contain in their own nature a security against excess.” ~ Alexander Hamilton

Hamilton decried the type of tax system that is in place today. He believed that there needed to be balance in the way people contributed to the functioning of government that could only be found by taxing consumption. Every effort to close “consumption” based loopholes that would affect the wealthiest Americans has almost always been voted down. There is no tax structure that provides balance. The result of which is increasing deficits as the needs of average Americans are pitted against big business profit demands.

I’m not worried about the deficit. It is big enough to take care of itself.” ~ Ronald Reagan

The contributions of the working class has kept America afloat in these tough economic times, not the largesse of the wealthy. By a huge margin, average Americans contribute the most time and money to nonprofits and those in need. After all, “average Americans” outnumber the wealthy by a factor of 100 to 1. But the burden-sharing is far from equitable. Let’s start by bring back equity in our tax system and close the loopholes that benefit the few at the expense of the average American.

For more on poverty and hunger visit Community Plates.

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