Thursday, February 02, 2012

The Coming Revolution

Call me a naive Pollyanna, but I believe that both parties have moved so far away from the interests of the middle class that significant change with regard to workers' rights is becoming more of a possibility.  Disillusionment with the status quo is off the charts.  

One of the major factors in the recent ascendance of capitalists at the expense of workers was the co-opting of much of the middle class through 401k plans and other similar initiatives which greatly expanded the number of voters benefiting from high returns to capital.   Can this be rolled back?  I believe so, since capitalism as always contains the seeds of its own destruction.  

Politicians have been afraid to let stock values fall.  This was seen clearly in the fall of 2008 when the bailout was rushed through in response to panicking markets.  The longer this goes on, the more overvalued markets become, and the higher the potential for a crash.  And fundamental values are actually harmed as a higher percentage of national income is devoted to capital at the expense of labor, as capital prices rise and consumption potential falls.  

With the public already massively disillusioned with the last set of bailouts for the 1%, the stage is set for political chaos the next time markets panic.  If the political system fails to prop up the markets in which many of us have invested our life savings, the ownership society we've built over the last 30 years will collapse.   If the government does prop up the markets again, both the right and the left will revolt unless the socialist intervention extends deeper into the middle class.

This is the setting that will greet President Mitt Romney, should he win the presidential election in November.  Obama has been a decent president, but has been victimized by a dysfunctional political system and will have trouble overcome racial favoritism.  Should the tone deaf Romney win, all the pieces will be in place for a middle class or 99% revolt.  Once that gets rolling, it will become self-sustaining.  As laws favoring capital are rolled back, stock market values will fall in reflection of the less friendly investment climate.  The ownership society and markets will take another credibility hit, and the rising tide favoring workers and social insurance programs will sweep away the opposition...