US Society: Extreme Wealth And Growing Poverty an Explosive Mix.

Elon Musk's five Bel Air homes. Paid for by Tesla workers and others. Source

Richard Mellor

Afscme Local 444,retired

Here in the US we are in the belly of the capitalist beast. Most of the globe’s billionaires are here and its industries, dominate the world. We have only two capitalist parties at this point and no party that is based on workers and our communities. The market is god here. And while there has been some changes in that view, many victims of the market, the poor, disenfranchised and so on, still defend it.

Here in California, homelessness is a major issue with huge tent cities springing up everywhere. One of the reasons for this is the relatively mild winters throughout the state. And our public schools are struggling for cash and resources yet we have the most billionaires in the US about 90 in all. The United States is also home to five of the world's top 10 cities with the most resident billionaires. Tesla’s Elon Musk is one of them and he spent $100 million on six homes in Los Angeles, all on them close together on two streets. He also has a 100 yea- old ranch in Northern California. His Tesla factory and the workers who are the source of much of his wealth is 20 miles from where I write. One property Musk turned in to a private school for his five sons. Many of these social parasites do this. Mark Zukerberg spent $50 million on five homes across the bay here in San Francisco. It’s also a way of protecting their environment, keeping the rest of the world at bay.

Alongside this obscene wealth, we have the worst health care system in the advanced capitalist world. National health care spending in the US rose to $3.65 trillion in 2018 a 4.6% increase from a year earlier and was 17.9% of the US economy by 2017. Despite this figure, which is the highest of all the advanced capitalist countries, by 2016, the U.S. “….had the lowest life expectancy of 12 comparable countries.” According to the Wall Street Journal and we have one of the worst infant mortality rates. It is worth noting that the life expectancy of white American’s a “privileged” group is declining. As things stand, health care spending is projected to climb to 19.4% by 2027

Meanwhile, one million people were added to the number of Americans without health insurance in 2018 for a total of 30.7 million. As pathetic as Obama’s Affordable Care Act is, it did offer some respite to the uninsured, increasing coverage to a further 20 million people and I think we cannot underestimate what this meant to those folks. The problem is that the ACA left the insurance companies intact.

In order to pay for the expanded health coverage, a tax was imposed on insurance companies in the form of an annual fee. The Trump administration suspended it in 2017 and 2019 and it is expected to return to the books in 2020.

It shows the flaws in taxing capital and keeping a crucial social service industry like a nation’s health care in private hands. In response to the tax, insurers simply raised prices hurting consumers of health care which means the sick, the elderly the poor and do on.

Blaming the increased cost of health care on the tax is not entirely wrong, the same argument used against increasing the minimum wage or legislating minimum wage laws. The apologists for capital never argue that wage increases eat in to their profits so they might not be able to buy that yacht or take that home in a fancy neighborhood which is the case. They have to appeal to the wage workers’ self interest and link wages to prices claiming, as if it is a divine law, that a loss of jobs is a natural outcome of wage increases. Workers would not be so receptive if the boss explained that they want to keep their goodies at our expense.

The same is the case with this ACA tax argument. How is it that the insurance companies can counter the increased coverage by passing ttaxhe costs on to the sick and on the consumers of health care?  It is their profits they are protecting and they can always hide those; it’s their right as capitalists. This is why they oppose a public national health care system or even Obama’s  “public option” that disappeared as swiftly as it arose, because with a public option the consumer has a another choice. Prices can rise if the market can bear them. The public option gave the consumer of health care more leverage.

Poverty, homelessness, environmental destruction, collapsing social infrastructure are a result of capitalist crisis and efforts to clean up these social crises are paltry to say the least. Public expenditure is money out. It is returning to workers some of the wealth we create in the form of social services. In addition, capitalism needs some of these services in order to maintain a relatively stable system for profit making and capital accumulation.

The social services that do exist, are often exploited by the very same people that assail government spending. They have no principles whatsoever and at every opportunity they will gleefully bury their elongated snouts in the public trough. It’s called entrepreneurship.

New York City has a program that relocates homeless shelter residents. According to the WSJ it’s called the Special One-Time Assistance program. It provides a year’s rent “anywhere in the US” if they can prove they can continue the payments after the one year is up. So far, 12,482 people (5,074 families) over the past two years have used it. Sounds pretty good doesn’t it? But as you can see from the graph, NY City has about 78,000 homeless people, by that measurement it’s not much of a relief.

You will find more infographics at Statista

Because we have no real social housing program in the US, these homeless families were placed in private apartments and NY City housing inspectors often failed to check out the rentals according to the media.*  As of August 2019, New York City residents paid $89.12 million to landlords, a nice deal for them. It’s similar to section 8 housing where cities pay market rent to homeowners to house welfare or other low income of poor people. It’s a great deal for the owner of property.

Some of these families were forced to live in squalor ”without heat and infested with mice and vermin” according to a report by the Department of Justice.  Some apartments had defective facilities and one a defective boiler that left people living in a place with a 42.6 degree temperature in winter. There was no accountability for the landlords “…due to a flaw in the city’s paperwork….”, the report says. There’s that damn flaw in the paperwork again; language in an important weapon in capitalism’s never ending war against workers. Some of these folks were sent to apartments in Newark and the mayor of Newark is suing New York City which has opened this issue up.

There is talk among some of the politicians hoping to dislodge the degenerate trump to end the US “forever wars”, after all, the Afghan war has lasted 17 years and the mighty US war machine has been unable to defeat a ragtag group of medieval warlords. But US capitalism has been at war with its own working class and poor since the European invasions, starting with genocidal war against the original inhabitants. The history of its rise to power and final consolidation as a nation state with the second half of its revolution we call the Civil War, has been nothing but brutality and violence. US Labor history is a rich and militant chronicle of the struggle of workers, immigrants we should add, against the most brutal of capitalist regimes. It has its weaknesses and its strengths; racism and racial violence, along with sexism and the war against women has played a sad and destructive role in organized labor’s history.

Yesterday there was a massive general strike in France. This follows on the heels of the street battles in Chile, Ecuador, Colombia, Algeria, Lebanon, Iraq and Iran, Hungary and Hong Kong where we can be sure the only issue was not the law that has been withdrawn. The Beijing regime is extremely worried that the struggle for democratic rights, free trade unions and so on could spread to the mainland. All workers must support the right to universal suffrage and democratic rights, but there must surely be other issues like housing and so on.  That some may have illusions in Trump is their weakness, but it is impossible to gauge the mood exactly from afar.

The situation in the US is explosive and will become more so as the economic situation changes. The economic situation is not looking good with corporate debt, one example, at around 3.7 trillion. This is not a positive thing. What we are seeing around the world will occur in the US with a vengeance. This movement has been delayed by the lack of any national movement able to bring all the many struggles together and the role of the heads of organized labor that act to suppress any movement that threatens the status quo. This delay is what will make the movement in the US so turbulent and at times confused and violent.

*I want to clarify with regard to the housing inspectors in this case. As with all public social workers burdened with overwork and having to deal with the failings of services to protect children, families, the poor etc. the blame is rarely theirs and any attempt by the capitalist media to blame them rather than market failures has to be suspect.