No Dead Frogs

The story about the boiled frog is apocryphal – that means it isn’t true, it only sounds true. But you know how the story goes – the frog sits in the warm water, all comfortable, and the water temperature keeps rising, but very slowly – so the frog doesn’t do a thing, until the frog is boiled to death. It’s that slow rise in temperature – that you hardly notice, or that you kind of like – that’ll kill you. You realize too late that you’re being boiled to death – and we’re all frogs or some such thing.

But of course any frog knows better, and jumps out of the water when things hurt. What else would the frog do? It’s only a metaphor, a metaphor for those continual little changes – each for the worse, but each not so bad in and of itself – that fool people into thinking things are still fine and dandy, when they’re clearly not anymore. Maybe many a marriage is like that. But married couples divorce all the time. They’re not frogs. But the idea is that people never realize how bad things are, when things only get bad slowly but surely, not suddenly and dramatically. And of course that’s nonsense. They know. The only question is when to jump.

And Steve Benen gauges the current water temperature:

Over the last three decades, wealth has become increasingly concentrated at the top. The middle class is struggling with stagnant wages and a growing class gap; poverty rates are soaring; the jobs crisis seems never-ending; and a growing number of Americans are suggesting it’s time for a larger conversation about economic inequalities and tax fairness.

Yes, it’s time to jump, but Benen flags this response to that notion:

In a promo for the upcoming “Your Money, Your Vote” Republican debate on CNBC that aired on today’s edition of Squawk On The Street, a voiceover asks, “How will candidates end the war on wealth?” During the voiceover the ad shows images of the Occupy Wall Street protests.

How will candidates end the war on wealth? What war on wealth? We were talking about frogs. But Benen also notes that this wasn’t Fox News, it was CNBC, and it’s in the air everywhere:

This was also part of a promotional effort for an upcoming debate for Republican presidential candidates, each of whom will be eager to talk about their desire to cut taxes for the wealthy even more, as if the rewards for wealth that are already in place, ensuring that the rich keep getting richer, aren’t quite sufficient.

The New Gilded Age must be solidified … because the alternative is a “war on wealth.”

Benen considers this a twisted worldview. But there is the other worldview, where the idea might be to jump out of the hot water – a matter of rejecting what modern capitalism itself has become, in a sort of Michael Moore meets Karl Marx kind of way – or to lower the temperature of the water – a matter of reforming what modern capitalism has become with new regulations and further safeguards, and with the absurdly wealthy paying a bit more in taxes, maybe even at the previous levels they had willingly endured for many long decades, back when the country was doing just fine, and so were they. The Occupy Wall Street folks have suggested both alternatives, and many in between. But mainly they’ve said it’s time for something to be done.

And one of the economists from the Clinton administration, Brad DeLong, now teaching up at UC Berkeley, says that if these guys at the top had even a lick of sense they’d act in their own self-interest:

The 1% has an interest in full employment, high capacity utilization, and general prosperity just as the rest of us do… The 1% has a strong material interest in the passage of the American Jobs Act. In acting to block it, the Republicans – and Senator Nelson – are betraying the interests of their contributors in the top 1% as much as they are betraying the interests of their constituents.

And he might have mentioned that’s a classic stupid-frog-being-boiled-to-death problem. They don’t sense the temperature rising. They really don’t seem to know that they’re in hot water.

And Kevin Drum puts it this way:

But here’s the thing: this has been true all along. Hell, it’s been true for the past decade. Sure, the rich want low taxes for themselves and they want income inequality to rise so they get most of the returns to economic growth. That’s in their own self-interest. But they also want – or should want – an end to the recession and a thriving economy, and they should be pressing both Congress and the Fed to do everything possible to make that happen. But they aren’t.

And all Drum has are questions:

Is it just pure blinkered ideology? Ignorance and stupidity? Or do they really not care as long as the brightwork on their yachts stays polished? It is a mystery.

Well, maybe frogs aren’t the answer. Maybe they need to know about monkeys, and in an attempt to explain the whole Occupy Wall Street thing, at Wired, in a science column, Jonah Lehrer describes this odd study done with monkeys:

The primatologists trained brown capuchin monkeys to give them pebbles in exchange for cucumbers. Almost overnight, a capuchin economy developed, with hungry monkeys harvesting small stones. But the marketplace was disrupted when the scientists got mischievous: instead of giving every monkey a cucumber in exchange for pebbles, they started giving some monkeys a tasty grape instead. (Monkeys prefer grapes to cucumbers.) After witnessing this injustice, the monkeys earning cucumbers went on strike.

Some started throwing their cucumbers at the scientists; the vast majority just stopped collecting pebbles. The capuchin economy ground to a halt. The monkeys were willing to forfeit cheap food simply to register their anger at the arbitrary pay scale.

This labor unrest among monkeys illuminates our innate sense of fairness. It’s not that the primates demanded equality – some capuchins collected many more pebbles than others, and that never created a problem – it’s that they couldn’t stand when the inequality was a result of injustice.

And now people started throwing their cucumbers. Enough is enough.

Or maybe, cucumbers and boiled frogs aside, this is the way things are. Things slowly, over time, got worse and worse, and now nothing can be done. And over at the American Enterprise Institute that is how Arnold Kling sees it:

There are two widely circulated narratives to explain what is going on. The Keynesian narrative is that there has been a major drop in aggregate demand. According to this narrative, the slump can be largely cured by using monetary and fiscal stimulus.

The main anti-Keynesian narrative is that businesses are suffering from uncertainty and over-regulation. According to this narrative, the slump can be cured by having the government commit to and follow a more hands-off approach.

Yeah, we know that, but he suggests a third interpretation.

Without ruling out a role for aggregate demand or for the regulatory environment, I wish to suggest that structural change is an important factor in the current rate of high unemployment. The economy is in a state of transition, in which the middle-class jobs that emerged after World War II have begun to decline.

And he cites Erik Brynjolfsson and Andrew McAfee in Race Against the Machine:

The root of our problems is not that we’re in a Great Recession, or a Great Stagnation, but rather that we are in the early throes of a Great Restructuring.

And Kling notes that we’ve been here before:

In fact, I believe that the Great Depression of the 1930s can also be interpreted in part as an economic transition. The impact of the internal combustion engine and the small electric motor on farming and manufacturing reduced the value of uneducated laborers. Instead, by the 1950s, a middle class of largely clerical workers was the most significant part of the labor force.

And here we go again:

The economy today differs from that of a generation ago. Mortgage and consumer loan underwriters have been replaced by credit scoring. Record stores have been replaced by music downloads. Book stores are closing, while sales of books on electronic readers have increased. Data entry has been moved off shore. Routine customer support also has been outsourced overseas.

These trends serve to limit the availability of well-defined jobs. If a job can be characterized by a precise set of instructions, then that job is a candidate to be automated or outsourced to modestly educated workers in developing countries.

Were you a frog you might notice the water is at a near-boil, and that means action is called for – something must be done. But Kling is not hopeful about what can be done:

The most optimistic scenario is the one I consider least likely. Under this scenario, the supply of workers adapts to changes in technology. In particular, this means a future with relatively fewer workers whose skills are limited to following directions in well-defined jobs. Instead, more workers will have the cognitive ability, initiative, and self-discipline to constantly update their skills, adapt to new technology, and to participate in the creative part of creative destruction. Under this scenario, economic growth will be very high, and median earnings will also be high.

But he sees that as unlikely:

Perhaps the middle-class affluence that emerged during the latter part of the industrial age is not going to be a feature of the information age. Instead, we could be headed into an era of highly unequal economic classes. People at the bottom will have access to food, healthcare, and electronic entertainment, but the rich will live in an exclusive world of exotic homes and extravagant personal services.

And David Frum doesn’t like the implications of that:

What happens in that scenario to political democracy?

After all, sooner or later everybody will wake up to what is going on, assuming they have not woken up already. The bottom 240 million or 297 million or 299.7 million have the votes. Won’t they try to use those votes to redistribute away from their new information-age economic betters?

More relevantly: won’t the information-age economic betters resist? Won’t they begin to perceive political democracy as a threat to their interests? Won’t they begin to work to subvert and curtail it?

And Frum points out the obvious:

The distribution of power tends to follow the distribution of wealth. If only a comparative few own, then only a comparative few will rule. If it’s indeed inevitable as Kling hypothesizes that wealth must concentrate in the information age then it’s equally inescapable that democracy must yield to a new political system that better protects the interests of those who possess it. Understand that implication – and brood on it.

And here’s his scenario for what’s most likely:

I’m not suggesting here that anyone will overthrow the Constitution or anything like that. The forms of American constitutionalism will remain intact, just as the forms of the British monarchy remain intact. We’ll still have elections, just as the British have royal weddings.

But maybe we’re there already. There’s a reason fewer and fewer people bother to vote. What’s the point? The folks at the top do what they want, for themselves.

But there may be another way to look at this, as Will Wilkinson considers the psychology and ideology of responsibility – you know, where conservatives think people are responsible for themselves and liberals think that luck and social forces play a bigger role in people’s fates in this sorry world:

I agree that many people are in dire straits and suffering for absolutely no fault of their own, and that policies ought to be in place to provide meaningful material assistance. Still, I find I want an ethos of effort and individual responsibility to prevail… And this is why I have a hard time seeing eye to eye with some progressives. Progressives are sincerely inclined to impersonal, socio-cultural explanations of success and failure, but I think they’re also generally of the opinion that an ethos of initiative, hard work, and individual responsibility will impede the political will to offer assistance to those who ought to get it. I’m not sure that they’re wrong. After all, those who tend to oppose progressive transfers tend to do so partly on the basis of their disbelief in the faultlessness of the needy. In any case, it seems to me progressives’ deep-seated opposition to victim-blaming and by-the-bootstraps perorations helps keep a lot of suffering people from getting the other, non-material part of what they really need: encouragement to meet the social expectation that they will continue supplying effort on their own behalf, even if that hasn’t worked out well so far.

And Wilkinson just likes that top One Percent, but with some reservations:

Unlike most of us, they’ve got the means to make the world match their wills. More generally, organized groups can be effective agents of real change. (It takes a village.) And groups are easiest to organize along lines of common material interest. That’s why, for example, “right-to-work” laws look to progressives like unilateral disarmament of the working classes, next to which the right of an individual to opt out of collective bargaining seems trivial. What’s the value of having the right to individually negotiate your terms of employment when all that gets you is screwed over? A politics of nothing but individual rights in a world dominated by social forces is a recipe for domination by those sufficiently powerful or organized to shape those forces.

So he’s fine with libertarians and conservatives lauding those masterful folks who make the world match their wills, and progressives “ought to take seriously the possible anti-social, demoralizing effects of a culture too quick to absolve individuals of responsibility for their choices.”

And here Kevin Drum also offers some insight:

Obviously there are lots of different kinds of lefties, and they have lots of different beliefs. And I don’t have an argument with the notion that lefties place more emphasis on the role of luck and social conditions in life outcomes than conservatives do. But seriously: is there really a sizeable chunk of the left that believes an “ethos of initiative, hard work, and individual responsibility” is an actively bad thing?

I don’t think so. It’s possible that the segment of the left that believes this is small but loud, but I don’t even really believe that either.

Drum is just not impressed with this argument:

First, I think this kind of post suggests the dangers of spending too much time on the web, where the loudest and most extreme voices actually do have a disproportionate influence sometimes. That can lead you to believe that their beliefs are far more widespread in the real world than they really are. Second, as Wilkinson suggests, to the extent that he’s correct it’s because of the almost insane levels of partisanship and tribalism that we see in politics today. Speaking just for myself, there are very definitely times when my preferred policy position is some kind of melding of left and right (i.e., social forces are important and an ethos of personal responsibility is important), but I’m not really willing to say so because the American right has become so insane that it simply won’t lead to anything constructive. It will just be viewed as a preemptive compromise that’s immediately seized upon to move the conversation even further to the right. Supporting compromise positions only makes sense when that might actually lead to both sides compromising.

So here again we have more water slowly coming to a boil, without realizing we’re about to get cooked:

Anytime a dominant narrative becomes hardnosed and extreme – as American conservativism has – it starts to feel like even the notion of a competing narrative has been lost. When that happens, those who believe in that competing narrative feel like the best use of their time is not to provide some kind of nuanced argument, but simply to take whatever chance they have to get a bit of airtime for their side. I think that’s what the last decade has done to a lot of center lefties, especially on economic issues. Very few of us, I think, have any problem with an ethos of personal responsibility. But the dominant narrative in the post-Reagan era has so thoroughly turned a blind eye to the power of malign social and economic forces that we feel like we simply have to take every opportunity to make them part of the conversation again.

What’s ironic, of course, is that those malign forces really are both economic (emphasized by the left) and social (emphasized by the right), which means that in a lot of ways conservatives lose out from this dynamic just as much as liberals. Tribalism makes fools of us all.

And we didn’t see that coming? No, we didn’t.

But Robert Reich says the frogs are about to jump out of the water over a specific boiling-point:

It’s whether Congress’s so-called “Supercommittee” – six Democrats and six Republicans charged with coming up with $1.2 trillion in budget savings – will reach agreement in time for the Congressional Budget Office to score its proposal, which must then be approved by Congress before Christmas recess in order to avoid an automatic $1.5 trillion in budget savings requiring major across-the-board cuts starting in 2013. …

Diffident Democrats on the Supercommittee have already signaled a willingness to cut Medicare, Social Security and much else that Americans depend on. The deal is being held up by Regressive Republicans who won’t raise taxes on the rich – not even a tiny bit.

President Obama, meanwhile, is out on the stump trying to sell his “jobs bill” – which would, by the White House’s own estimate, create fewer than 2 million jobs. Yet 14 million people are out of work, and another 10 million are working part-time who’d rather have full-time jobs.

Republicans have already voted down his jobs bill anyway.

Reich argues that the gap between Washington and the rest of the nation hasn’t been this wide since the late sixties, and we’re on a collision course:

Americans who are losing their jobs or their pay and can’t pay their bills are growing increasingly desperate. Washington insiders, deficit hawks, regressive Republicans, diffident Democrats, well-coiffed lobbyists and the lobbyists’ wealthy patrons on Wall Street and in corporate suites haven’t a clue or couldn’t care less.

The next election should be interesting, given that, and it’s not just us:

Look elsewhere around the world and you see a similar collision unfolding. The details differ but the larger forces are similar. You see it in Spain, Greece, and Italy, whose citizens are being squeezed by bankers insisting on austerity. You see it in Chile and Israel, whose young people are in revolt. In the Middle East, whose “Arab spring” is becoming a complex Arab fall and winter. Even in China, whose young and hourly workers are demanding more – and whose surge toward inequality in recent years has been as breathtaking as is its surge toward modern capitalism.

Perhaps 2012 will go down in history like other years that shook the foundations of the world’s political economy – Reich suggests 1968 and 1989 – as what has been set in motion cannot be stopped:

Here, as elsewhere, people are outraged at what feels like a rigged game – an economy that won’t respond, a democracy that won’t listen, and a financial sector that holds all the cards. Here, as elsewhere, the people are rising.

Well, yes – the frogs are jumping out of the hot water. After all, the story about the fat, dumb and happy boiled frog is apocryphal. Things don’t work that way.

About Alan

The editor is a former systems manager for a large California-based HMO, and a former senior systems manager for Northrop, Hughes-Raytheon, Computer Sciences Corporation, Perot Systems and other such organizations. One position was managing the financial and payroll systems for a large hospital chain. And somewhere in there was a two-year stint in Canada running the systems shop at a General Motors locomotive factory - in London, Ontario. That explains Canadian matters scattered through these pages. Otherwise, think large-scale HR, payroll, financial and manufacturing systems. A résumé is available if you wish. The editor has a graduate degree in Eighteenth-Century British Literature from Duke University where he was a National Woodrow Wilson Fellow, and taught English and music in upstate New York in the seventies, and then in the early eighties moved to California and left teaching. The editor currently resides in Hollywood California, a block north of the Sunset Strip.
This entry was posted in Income Disparity, Occupy Wall Street, Structural Unemployment and tagged , , , , , , , , , , , , , , , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s