After shock: Is america ready for social cohesion - Essay Example

Aftershock: Is America Ready for Social Cohesion? In his book, Aftershock, Robert Reich contends that the primary cause of America’s financial turmoil is the economic inequality that characterizes the contemporary American Society. He elucidates that the top 1% of Americans own and consequently control about 23% of the nation’s assets (Tucker 52). Consequently, the rest of Americans are forced to go into coping mechanisms, rather than spending. This in turn leads to an economic stagnation. He recommends that an apt remedy would be to strive for economic equality. Equitable wealth distribution where the middle and lower class have a bigger share of the national cake would result in increased spending, which would in turn stimulate the economy. This paper will seek to summarize and review Reich’s recommendations as well as draw a level of inference with regards to whether or not American society is ready for a greater degree of social cohesion. Reich contends that it is in order to enact measures that would result in increased equitability in the distribution of economic resources. To achieve this, he asserts for example that a reverse income tax mechanism could be adopted, whereby the rich are taxed more while those earning less have their income supplemented by the government (Reich). This would aim to increase the amount of disposable income available to those in the middle class, increasing their purchasing power and spending capacity, thereby stimulating the economy. Another proposal set out by Reich is to have corporations pay a severance tax of 75% of an employees annual pay when an employee is laid off. In doing so, the aim would be for the taxman to reap from the increasing layoffs by corporations as they seek to outsource labor. Ostensibly, however, the move is aimed at deterring layoffs, thereby protecting the interests of workers. A sharp analysis of these recommendations reveals that they may not be so effective in the long run. Though they would be effective in stimulating the economy, it is hardly moral to tax individuals for accruing wealth, in an economy whose basic principle encourages individual wealth accrual. Furthermore, though increasing spending is likely to stimulate the economy, the gains therein are more likely to serve countries from which these products are sourced. According to Tucker, most of the shopping goods purchased by the middleclass come from outside our borders (toys from China, wine from Spain) (53). The principle underpinning of Reich’s recommendations is social cohesion where each citizen holds the interests of fellow citizens at heart, the result being equitable distribution of national resources. Though a good notion, a quick glance at past attempts at such projects indicates that equitable distribution is not quite as feasible. The funding for public education clearly elucidates on this. In America today, there is the inequitable distribution of funds meant for public education. The inequity stems right from the point where funds are sourced, since about 50 % of funding comes from local taxes (Biddle and Berliner 48). This out rightly places impecunious localities at a disadvantage. These differences are experienced at the state level, the district level and even for public schools within the same district. Biddle and Berliner point out that these inequalities probably stemmed from a shift of systems from one where funds were sourced from voluntary contributions, to one where the local property tax catered for this funding (53). As civilization progressed, there was class filtering where the more affluent were eventually separated from the more impoverished. Already entrenched in the minds of each individual was the notion that school funding should be sourced locally and therefore, those in the affluent suburbs saw no reason to inject funds to the more impoverished schools. As such, Reich’s description can be seen as one of the most fundamental levels of disagreement which currently exists within the American political spectrum. Rather than breaking down this societal understanding along the lines of Democrats or Republicans, it is instead necessary for the reader to calm to an understanding that this can only be understood within the concept of progressivism and reactionism; i.e. conservatism and liberalism. Accordingly, the fundamental question which exists within this debate is whether or not it should be the responsibility of all individuals within society to create a more equitable system whereby wealth is redistributed from those who have to those who have little. Such a concept is of course not new and has existed since the Dawn of the modern political Europe (Gordon and Cullen 1101). Naturally the growth of Marxism and communism helps to further the understanding of wealth redistribution and the role of the state and sponsoring further levels socialism; however, as history has proven, these systems represent unique drawbacks cannot adequately speak to the needs of everyone society. Rather than arguing whether wealth redistribution and a higher degree of socialism is ultimately at good or a net evil for the current American system, the purpose of this brief analysis will be to draw a level of inference with regards to the overall sense of solidarity that currently exists within the United States. As a means of measuring this level of solidarity, the author will draw upon past history, the results of prior election cycles, and statistical inference with regards to the degree to which the American society would likely integrate itself within such a paradigm. Such a level of wealth redistribution can take place in a variety of different forms. As Reich notes, raising the income tax, creating stronger legislation to protect workers and labor unions, increasing the amount of money spent on social welfare, and/or redefining the tax system so that innovation and loopholes are no longer evidence, are but a few of the ways that wealth reduced vision within the current society could be affected. Yet, as can be noted by the reader, each of these activities will necessarily involve the needs and wants of a diverse group of stakeholders. Accordingly, the stakeholders that have something to lose within the situation, i.e. the wealthier members of society, are not likely to appreciate or into her the increased level of hardship that Reich is proposing. In such a way, the disconnect between social’s theory and the reality of the power that certain stakeholders have preventing this from taking place, must necessarily be reconciled (Yamamura 499). A unique aspect of the American political system is of course the realization an understanding that the local power is held disproportionately. Although it may seem convenient from a patriotic standpoint to claim that all voters are represented equally within the American system, the painful and obvious fact of the matter is that those stakeholders within society are disproportionately represented within the political system due to the overall fact that they are the ones which are primarily responsible for funding the campaigns for many of the representatives within the United States political system. Those that might be in favor of the belief that American society is both willing and able to shoulder the financial burden that is specified by Reich would likely point to the fact that the United States has oftentimes sacrificed of its manpower, resources, and time to engage with and facilitate improvements in the quality of life that less fortunate individuals around the globe might experience. This has of course be realized with regards to the means by which AIDs assistance has been given to Africa and the means by which United States peacekeepers are sent to diverse regions where there exist few United State’s strategic interests. However, it must be understood by individuals that would otherwise seek to ascribe to such a viewpoint that these are choices and decisions that are not left up to taxpayers (Sorger & Stark 4). Instead, they are taken by the federal government entirely. If such financial assistance to the third world was put to a vote, a very different dynamic entirely might be witnessed. Furthermore, utilizing prior presidential elections and congressional elections as an indicator, the reader/researcher can see what appears to be the beginnings of a fundamental shift with regards to American appreciation for and integration with the ideas of increased social programs and the need for a more equitable form of income reapportionment. However, such an indicator as a few election cycles is hardly able to capture the zeitgeist of the era; rather, it may merely be a short-lived trend that will allow the rubber band to snap in the opposite election in but a few brief years (Musto 995). More importantly, the reader/researcher should consider the means by which the general public integrates with an understanding with regards to the importance of educational funding. This is a unique aspect of a social good that affects each and every shareholder within society. Whereas certain welfare programs solely target the disenfranchised, the educational system is a societal good that impacts upon the lives of all individuals; regardless of whether or not they even have children. This is of course due to the fact that the educational system impacts upon the prospects of the future for the economy, the overall level of training and intelligence that the average citizen illustrates, and the growth and further development of the nation as a whole. However, what can be noted is that the moment that the slightest trembles are felt within the foundations of the economy, the Department of Education, as well as the ancillary school funding that impacts each and every community within the United States, is one of the first targets for elimination that individuals oftentimes engage with (Radu 229). As such, the level of solidarity that society supposedly has appears to evaporate within the context of the slightest fears for the state of the governmental budget or the outlook of the economy as a whole is threatened. It should be understood that wealth redistribution by its very nature will take from those that have and give to those that do not. Accordingly, human nature dictates that the individuals who are being taken from will not necessarily appreciate or enjoy the process of having their assets redistributed among society. However, as has previously been noted, in order for such a system to work it is a necessity that all members of society integrate within it (Doepke and Schneider 494). Such a wholesale level of participation necessarily denotes problem. Due to the fact that certain individuals within society, necessarily those that are more wealthy than others, will wholeheartedly pushback against any form of wealth redistribution, the level to which a society wide system can be affected, with total and complete participation, is necessarily reduced. In such a way, the reader can and should realize that the differential that exists between theory and application of such an approach is necessarily vast (Gruner and Rudiger 1409). As a means of understanding the preceding analysis, it is the view of this author that society, as has been described, is ultimately not ready for the type of shared sacrifice that Reich requires. As numerous studies have indicated over the past several decades, although the prospects that socialism can afford to the American, and global system, is generally positive, the level and extent to which the individual stakeholders of government and society are willing to integrate with these requirements are ultimately not sufficient to see such plans come to fruition. Applying this understanding to the more thorny issue of the wealthier members funding the destitute members of society, it is not difficult to understand why it might be extremely difficult to get them to do so willingly. Our society today is one that is oriented towards a capitalist perspective (Greco 59). Members are brought up with a mindset towards consumerism whereby they perceive that more money equals more power. This is similar to the scenario on public schools where members developed the notion that funding ought to come from the local tax collections. Consequently, once class separation occurs, it is highly unlikely that these individuals are likely to adopt any new outlook and it would therefore be difficult to convince them that they should give up more so that those in classes below them can have more. A different outlook on this issue is to ignore the factor of free choice since after all, once legislations are laid down, individuals have no choice but to comply and abide by the rule of law. The claim of such an assertion is that the rich will have to pay more taxes once they are instituted. The Obamacare policy for example, has had dramatically helpful results in the healthcare sector due to the. Such a move however would face serious bottlenecks. For starters, such legislations would have a difficult time navigating successfully through the corridor of congress. Tucker points us to the fact that any move to increase taxes on any American is normally met with great resistance from those on the floor of the House of Representatives (54). He further points out a rather intriguing observation that the middle class voted for individuals who promised to protect wealthy individuals from further taxation. This indicates that the problem may not actually be with the wealthy but with the people. Works Cited Biddle, Bruce J., and David C. Berliner. "A Research Synthesis / Unequal School Funding in the United States." Beyond Instructional Leadership 59.8 (2002): 48-59. Print. Doepke, Matthias, and Martin Schneider. "Aggregate Implications Of Wealth Redistribution: The Case Of Inflation." Journal Of The European Economic Association 4.2/3 (2006): 493-502. Business Source Premier. Web. 27 Apr. 2013. Gordon, Roger H., and Julie Berry Cullen. "Income Redistribution In A Federal System Of Governments." Journal Of Public Economics 96.11/12 (2012): 1100-1109. Business Source Premier. Web. 27 Apr. 2013. Greco, Luciano G. "Optimal Redistribution With Productive Social Services." Scandinavian Journal Of Economics 113.1 (2011): 55-73. Business Source Premier. Web. 27 Apr. 2013. Gruner, Hans Peter, and Rudiger Schils. "The Political Economy Of Wealth And Interest." Economic Journal 117.523 (2007): 1403-1422. Business Source Premier. Web. 27 Apr. 2013. Musto, David K., and Bilge Yilmaz. "Trading And Voting." Journal Of Political Economy 111.5 (2003): 990-1003. Business Source Premier. Web. 27 Apr. 2013. Radu, Claudia Florina. "Ways Of Income Redistribution In Society." Scientific Journal Of Humanistic Studies 4.6 (2012): 228-233. Academic Search Complete. Web. 27 Apr. 2013. Reich, Robert B. Aftershock: the next economy and America's future. New York: Vintage Books, 2011. Print. Sorger, Gerhard, and Oded Stark. "Income Redistribution Going Awry: The Reversal Power Of The Concern For Relative Deprivation." Journal Of Economic Behavior & Organization 86.(2013): 1-9. Academic Search Complete. Web. 27 Apr. 2013. Yamamura, Eiji. "Social Capital, Household Income, And Preferences For Income Redistribution." European Journal Of Political Economy 28.4 (2012): 498-511. Business Source Premier. Web. 27 Apr. 2013. Tucker, Patrick. "Surviving the Great Recession's Aftershocks." The Futurist 45.2 (2011): 52-54. Read More