American Inequality and the Question of War

Posted 6:39 p.m. Nov. 13

by Melissa Kronfeld

(U-WIRE) WASHINGTON–For months the Bush administration has argued in favor of a necessary change for the Iraqi regime. Their plan: to launch a pre-emptive strike with a full-scale invasion to topple Saddam Hussein. Hussein poses a threat to national security and to the security of our allies. And Washington has declared that they reserve the right to attack Iraq in order to preserve international security and prevent the emergence of a more immediate and devastating threat. And rightly so.

A highly publicized pre-emptive strike is rare. And due to this rarity, a greater degree of open discussion and debate regarding the costs and consequences of such a war are feasible. Unlike Vietnam, when the government was unable to provide American citizens with estimated costs of war, the Bush administration can and they have. In mid-September President George W. Bush’s chief economic advisor, Lawrence Lindsey told the Wall Street Journal that the U.S. could possibly spend between $100 billion to $200 billion on this war. This estimate towers over the $50 billion figure that Pentagon officials used in private Congressional meetings.

Two days after Lindsey’s statement was issued and media frenzy ensued, the Democratic staff of the House Budget Committee released a report concluding an initial military operation would cost $48 to $93 billion. But the report neglected to include figures for post-war US peacekeeping or occupational forces, humanitarian assistance programs or ally inducements like foreign aid grants. So, the Committee also stated that Lindsey’s estimate was in the “ball park.” Analysts approximate that US forces will number 125,000 to 250,000 and that combat will last between one and two months. They also believe that Iraq will not use any biological or chemical warfare. Costs will be “significantly higher than estimated” with the possibility that these variables change.

These are not the only wartime costs to take into consideration. Air Force General Charles Holland, who leads the U.S. Special Operations Command that oversees the campaign against the al-Qaeda terrorist network, recently requested an additional $23 billion in funding for the following five years, doubling his budget. And the very costly mission of Afghani reconstruction and assistance is far from finished.

Former President George Bush, Sr. waged war in the Persian Gulf in 1991. The cost of this military endeavor was only $80 billion (in current U.S. dollars). But allied forces in fact paid $62 billion or 75% of the expenditure. Bush, Jr. will not be as fortunate as his father though. The sequel will have a much more substantial budgetary impact.

With the current federal debt totaling $3.6 trillion, due in some part to Bush’s tax cuts, is a pre-emptive strike against Iraq the best course of action for America? The “white paper” recently issued by British Prime Minister Tony Blair on Iraqi weapons of mass destruction reported that Iraq is still years from developing a nuclear bomb. And the United Nations is in the process of negotiating the terms for a new round of more meticulous and unregulated weapons inspections that would include the dismantling of a Weapons of Mass Destruction (WMD) infrastructure. These cost-effective methods could serve as a means to deter the Iraqi threat while economic planning is implemented.

And planning is a dire necessity. The United States economic situation is a grave one indeed. The economic levels of inequality currently prevalent in American society have returned to those of the 1920’s, the age of F. Scott Fitzgerland’s The Great Gatsby. The present American political, economic and social condition suffers from, what I have labeled, ‘the Great Gatsby Syndrome.’ The United States has restored the ‘Gilded Age,’ where armies of servants and Long Island mansions are all the rage.

So what does the “Great Gatsby Syndrome” mean? It essence, it means that the greatest amount of wealth is being controlled by a very small percent of the population. This unequal distribution of wealth leaves a large majority very poor, and essentially diminishes the middle class society of the 1950s and 1960s.

History is again repetitive. But why has America, the nation who champions the people and provides equal opportunity for all, regressed to this state of inequity? As I mentioned before, pre-1930 society was a ‘Gilded Age,’ where a few were rich, and the many were poor. According to the United States Census Bureau, in the 1920s, the wealthiest 5% of American families received 30% of the national personal income. So when Franklin D. Roosevelt entered the White House in 1932, like a devoted missionary, he set out to restructure America, cure the effects of the Great Depression and redistribute wealth. By 1947 the wealthiest 5% only received 17.5% of personal income

During World War II, FDR instituted control over wages to compress the wage gap. This had a deep and profound social effect on American society. FDR imposed new social norms that dictated a greater degree of relative equality. According to New York Times columnist and Princeton economic professor Paul Krugman, wages are a reflection of societal norms. With the establishment of egalitarian norms in the 1930s and 1940s, a higher level of equality characterized the United States.

In the 1950s and early 1960s the newly established norms changed American society for the better. A large middle class, who lived comfortably and securely, represented a majority of the population. Corporate culture was defined ‘team work’ and the manager, CEO or company president provided leadership for the firm, receiving little personal recognition. According to the Census Bureau, by 1969 the share of personal income retained by the wealthiest 5% of American families had dropped to 15.6%.

As the ’60s progressed, American society began to change. The relaxation of old strictures began and a counter-culture development alongside a sexual revolution. New norms evolved within society characterized by openness. These norms also impacted the business world, inducing a greater financial permissiveness. By the 1970’s the notion of ‘if it feels good, do it’ pervaded economic life.

The 1980s and 1990s, saw an income explosion. By the 1989’s the wealthiest 5% had increased their share of personal income to 17.9%. Corporate culture was defined by its celebrity-like CEO’s, sought after for charisma and individuality. The business world discovered greed was good and it worked well in terms of driving executives to achieve company success. Krugman writes, “The America of ‘Wall Street’ and ‘The Bonfire of the Vanities’ was positively egalitarian compared with the country we live in today.”

Statistically, America has a higher per capita income than any other advanced nation in the world. But this is only so because our rich are much richer. Among the industrialized nations, the U.S. has the highest concentration of individual wealth. It is roughly three times the amount of Germany, who ranks second. The top 1% of the population (the wealthiest class) retains 38.1% of net worth. The bottom 40% (the poorest class) retains only 0.2%. Another way to illustrate this inequality is through the change in average net worth. From 1983 to 1998, the top 1% increased their average net worth by 42.2% while the bottom 40% decreased by 76.3%. In 2001 the Census Bureau reported that the richest one-half of 1% of American taxpayers accounted for more than 11% of aggregate income.

Poverty and instability now characterize American society. It was reported in 2001 that almost a quarter of all workers, over 28 million American, earn less than $8.78 an hour. This amount equals that which is necessary to lift a family of four just above the poverty line with full-time work. Forty-seven million homes have annual incomes below $35,000. So, in the event of a layoff of any nature of medical emergency, 40% of all Americans would be without cash within a period of three days.

The U.S. spends 13.1% of gross domestic product on medical care, more than any other advanced society. But in 1998, the National Center for Health Statistics reported that the U.S. ranked 28th for infant mortality, 18th for female life expectancy and 19th for male life expectancy. In 1990, 35 million adults and 8.5 million children were reported to have no health insurance. Nearly sixteen percent of American children live in poverty. And 33 million Americans, including 13 million children, go hungry or cannot afford a balanced meal on a regular basis.

The Census Bureau reports that only 20% of the American population constitutes the ‘middle class.’ With the evolution of history and ideological thought, mankind has learned that one the most fundamental tenets of democratic society is a middle class. When a middle class evolves in society, a stable foundation for the perpetual desire of education, prosperity and political rights emerges. A middle class provides a counter-force to a powerful aristocracy and an authoritarian government. The middle class is essential to democratic society.

As the American middle class diminishes, I ask who will provide that stabilizing force in political, social and economic rights? Krugman writes, “economic policy increasingly caters to the interest of the elite, while public services for the population at large – above all, public education – are starved of resources. As policy increasingly favors the interests of the rich and neglects the interests of the general population, income disparities grow even wider.”

I believe it is essential that we focus our attention on domestic matters. I am not asking for radical policy shifts or an end to the ‘war on terrorism,’ but how can we fight for democracy abroad if it seemingly waning at home? How can we provide for the poor in Afghanistan if we cannot provide for our poor at home? Before we rush into a multi-billion dollar war, perhaps we could reexamine the possibilities, taking into consideration the state of our own affairs.

We can only pray for quick and decisive victory if and when the Bush administration chooses to enter into this conflict with Iraq. But if we fail and chaos ensues, regional instability, domestic economic plight and the proliferation of Iraqi weapons of mass destruction will make the entire world a less stable place to live and the Bush administration will be unable to deny that didn’t see it coming. reporter David Corn writes, “Anyone who rushes to launch a pre-emptive war is asking for whatever unforeseen results ensue.”

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