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The following is excerpted from Crass Struggle by R.T. Naylor. A critique of the lifestyles of today's ultra rich bolstered by old-fashioned muckraking, Crass Struggle provides a sharp, original, and often humorous commentary on "the bad side of the good life, the underbelly of the potbelly."
At the end of World War II a senior North American corporate executive earned on average maybe forty times as much as a production worker, a ratio down from the roaring twenties and dirty thirties, although the numbers are too sketchy to be absolutely sure by how much. Governments in the West, haunted by the twin spectres of a Great Depression in the recent past and a Communist Bloc very much in the present, maintained that kind of spread, even narrower in Western Europe, with laws to protect collective bargaining, with progressive taxes, and with tight financial regulations. Those at the top were certainly well-off during the early postwar decades, but for the most part not obscenely so. And those who were extremely rich generally kept a low profile as they frittered away their family fortune.
Then came the mid-1970s. Governments, led by those in English speaking places, started to adopt what John Kenneth Galbraith, one of the few North American economists who valued social reality ahead of mathematical mumbo jumbo, called the “horses-and-oats” principle – feed a horse enough oats and it will leave something behind on the road for the sparrows to eat. Over the next thirty-plus years “globalization” (a polite term for big companies setting up in places free from environmental restrictions or pesky unions), “fiscal reform” (aka tax cuts for the rich balanced for the sake of fairness by welfare cuts for the poor), and “liberalization” (i.e., turning financial predators loose to do what they wanted with other people’s money) interacted to pave the way for a new parasitocracy. By the time crisis hit in 2007–08, those on the top rung of the pay ladder in North America, led by but certainly not restricted to the financial sector, carted home compensation packages equal to perhaps as much as 1,750 times the mean (in both senses) wage that was itself moving in real terms in the opposite direction. But maybe they deserve it? Just ask Leo Hindery Jr, billionaire sports broadcasting tycoon and racing-car enthusiast, who modestly remarked during the upswing: “I think there are people including myself … who because of their uniqueness warrant whatever the market will bear.”
That was a view shared by Sanford Weill, who was heralded as a genius for creating Citigroup and who counted as one of his most prized possessions the pen President Bill Clinton used to sign the deregulation bill that made Weill’s corporate goliath possible – or at least prevented it from being prosecuted for violating previous US laws intended to prohibit exactly that kind of financial supermarket. In 2007, in conformity with the central principle of modern economic theory that high wages for labour lead to sloth while high rewards for capital stimulate entrepreneurial effort, Weill rationalized compensation that had pushed his wealth, too, above the $1 billion point with the claim that “the results our company had … justified what I got.” Yet scarcely a year later, when Citigroup became the biggest financial failure in history, Mr Weill made no offer to return his previous merit pay. Of course, if most of it was in Citigroup stock, there may have been little left to give back.
Click here for another Crass Struggle excerpt
To arrange an interview with the author, contact MQUP publicist Jacqui Davis.
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