<nettime> Nouriel Roubini does Alex Foti

[Brian Holmes <bhcontinentaldrift@gmail.com>]

[ Not as good of course! But look at how far these guys - Roubini and
the sociologist Guy Standing - have gone in Alex's wake. ]

The Main Street Manifesto | by Nouriel Roubini

https://www.project-syndicate.org/commentary/main-street-manifesto-for-covid19-crisis-by-nouriel-roubini-2020-06

The historic protests sweeping America were long overdue, not just as a
response to racism and police violence, but also as a revolt against
entrenched plutocracy. With a growing number of Americans falling into
unemployment and economic insecurity, while major corporations take
bailouts and slash labor costs, something had to give.

The mass protests following the killing of George Floyd by a Minneapolis
police officer are about systemic racism and police brutality in the United
States, but also so much more. Those who have taken to the streets in more
than 100 American cities are channeling a broader critique of President
Donald Trump and what he represents. A vast underclass of increasingly
indebted, socially immobile Americans – African-Americans, Latinos, and,
increasingly, whites – is revolting against a system that has failed it.

This phenomenon is not limited to the US, of course. In 2019 alone, massive
demonstrations rocked Bolivia, Chile, Colombia, France, Hong Kong, India,
Iran, Iraq, Lebanon, Malaysia, and Pakistan, among other countries. Though
these episodes each had different triggers, they all reflected resentment
over economic malaise, corruption, and a lack of economic opportunities.

The same factors help to explain populist and authoritarian leaders’
growing electoral support in recent years. After the 2008 financial crisis,
many firms sought to boost profits by cutting costs, starting with labor.
Instead of hiring workers in formal employment contracts with good wages
and benefits, companies adopted a model based on part-time, hourly, gig,
freelance, and contract work, creating what the economist Guy Standing
calls a “precariat.” Within this group, he explains, “internal divisions
have led to the villainization of migrants and other vulnerable groups, and
some are susceptible to the dangers of political extremism.”

The precariat is the contemporary version of Karl Marx’s proletariat: a new
class of alienated, insecure workers who are ripe for radicalization and
mobilization against the plutocracy (or what Marx called the bourgeoisie).
This class is growing once again, now that highly leveraged corporations
are responding to the COVID-19 crisis as they did after 2008: taking
bailouts and hitting their earnings targets by slashing labor costs.

One segment of the precariat comprises younger, less-educated white
religious conservatives in small towns and semi-rural areas who voted for
Trump in 2016. They hoped that he would actually do something about the
economic “carnage” that he described in his inaugural address. But while
Trump ran as a populist, he has governed like a plutocrat, cutting taxes
for the rich, bashing workers and unions, undermining the Affordable Care
Act (Obamacare), and otherwise favoring policies that hurt many of the
people who voted for him.

Before COVID-19 or even Trump arrived on the scene, some 80,000 Americans
were dying every year of drug overdoses, and many more were falling victim
to suicide, depression, alcoholism, obesity, and other lifestyle-related
diseases. As economists Anne Case and Angus Deaton show in their book
Deaths of Despair and the Future of Capitalism, these pathologies have
increasingly afflicted desperate, lower skilled, un- or under-employed
whites – a cohort in which midlife mortality has been rising.

But the American precariat also comprises urban, college-educated secular
progressives who in recent years have mobilized behind leftist politicians
like Senators Bernie Sanders of Vermont and Elizabeth Warren of
Massachusetts. It is this group that has taken to the streets to demand not
just racial justice but also economic opportunity (indeed, the two issues
are closely intertwined).

This should not come as a surprise, considering that income and wealth
inequality has been rising for decades, owing to many factors, including
globalization, trade, migration, automation, the weakening of organized
labor, the rise of winner-take-all markets, and racial discrimination. A
racially and socially segregated educational system fosters the myth of
meritocracy while consolidating the position of elites, whose children
consistently gain access to the top academic institutions and then go on to
take the best jobs (usually marrying one another along the way, thereby
reproducing the conditions from which they themselves benefited).

These trends, meanwhile, have created political feedback loops through
lobbying, campaign finance, and other forms of influence, further
entrenching a tax and regulatory regime that benefits the wealthy. It is no
wonder that, as Warren Buffett famously quipped, his secretary’s marginal
tax rate is higher than his.

Or, as a satirical headline in The Onion recently put it: “Protesters
Criticized for Looting Businesses Without Forming Private Equity Firm
First.” Plutocrats like Trump and his cronies have been looting the US for
decades, using high-tech financial tools, tax- and bankruptcy-law
loopholes, and other methods to extract wealth and income from the middle
and working classes. Under these circumstances, the outrage that Fox News
commentators have been voicing over a few cases of looting in New York and
other cities represents the height of moral hypocrisy.

It is no secret that what is good for Wall Street is bad for Main Street,
which is why major stock-market indices have reached new highs as the
middle class has been hollowed out and fallen into deeper despair. With the
wealthiest 10% owning 84% of all stocks, and with the bottom 75% owning
none at all, a rising stock market does absolutely nothing for the wealth
of two-thirds of Americans.

As the economist Thomas Philippon shows in The Great Reversal, the
concentration of oligopolistic power in the hands of major US corporations
is further exacerbating inequality and leaving ordinary citizens
marginalized. A few lucky unicorns (start-ups valued at $1 billion or more)
run by a few lucky twenty-somethings will not change the fact that most
young Americans increasingly live precarious lives performing dead-end gig
work.

To be sure, the American Dream was always more aspiration than reality.
Economic, social, and intergenerational mobility have always fallen short
of what the myth of the self-made man or woman would lead one to expect.
But with social mobility now declining as inequality rises, today’s young
people are right to be angry.

The new proletariat – the precariat – is now revolting. To paraphrase Marx
and Friedrich Engels in The Communist Manifesto: “Let the Plutocrat classes
tremble at a Precariat revolution. The Precarians have nothing to lose but
their chains. They have a world to win. Precarious workers of all
countries, unite!”





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