I watched the Robert Reich documentary, Inequality for All, a couple of nights ago. In this documentary, Robert Reich was arguing that the decline of the middle class in the United States is not good for the economy or society. When the middle class is struggling to make ends meet, that means less consumption, which leads to further economic ills (i.e., companies laying people off because the companies are selling less, less tax revenue because there are fewer taxpayers, less education to help people compete in the face of globalization, etc.). Moreover, Reich contends that the current political polarization is due (at least in part) to rising economic inequality.
What was ironic about the documentary was that, in some cases, the people agreeing with Reich were the rich, whereas those arguing with him were the poor. Warren Buffett agreed that he should be paying more taxes. Someone Reich interviewed who made a six-figure salary was saying that he hardly pays any taxes, and that significant chunks of his money serve no social value at all. However, when Reich was speaking to factory workers, a couple of them were challenging Reich. One was suggesting that Reich was attacking the American way of life. Another factory worker was saying that he is not as smart as the rich are, which is why he is a laborer, but he said that the rich deserve to make all the money that they do.
There were plenty of exceptions to this rule, though. Reich interviewed a Mormon family, which is conservative on social and cultural issues, but which was lamenting that it had to work so many hours only barely to get by. Reich interviewed plenty of people who were struggling, even though they worked multiple jobs. On the other side, there was another person in the documentary who was actually defending corporate downsizing, saying that sometimes corporations need to lay people off in order to survive.
Something else that caught my attention on the documentary was when Reich was saying that the rich benefit from a strong middle-class, too, that it is not a zero-sum game. This is an important point, in my opinion, because Reich and people who believe along his lines are often accused of class warfare, of exploiting envy towards the rich, of wanting everyone to be economically equal. But that’s not the case. When there is a strong middle class, people are buying more products, and that helps the rich. And I agree with something that Elizabeth Warren said when she was running for Senate: yes, it’s all right for the rich to make the money that they do, but they should put some of it into the system (i.e., education, infrastructure) so that others can have the opportunities that they had.
This is a worthwhile documentary to watch.
Excellent review James 🙂