This week's New York magazine cover story is appalling, in one of those "this is why they hate us" ways. The piece was about the growing class of super-rich New Yorkers, and the merely wealthy cadre of entrepreneurs that has grown up to support their habit, and collect their fees. The municipal skim from the superclass pays for parks and clean streets and subways, Daniel Gross argued, because the mega-rich pay a huge portion of the total tax take. In many ways, they are what make New York the world capital it is: we have the largest percentage of super-wealthy per square mile. And their big-spending ways (the article is sidebared with pictures of $7,000 panties and the like) trickle down to the rest of us. Heck, sommeliers can make six figures! Some busboys in this town take home sixty grand!
Gross appears almost sexually excited by the presence of palpable wealth, but he makes a bold leap over a chasm of economic theory that leaves him quivering in space like Wile E. Coyote, ready to plunge to the canyon floor in a cloud of dust. And he does so with sections like this one:
The full scope of cultural offerings explains how local wealth contributes to economic development. New York isn’t just a center of finance. It’s home to industries like architecture and design, art and publishing, media and advertising, the businesses that attract what urban theorist Richard Florida calls the “creative classes”—hip, imaginative go-getters whom many cities regard as crucial to future growth. But the creative classes are drawn to places like New York in large part owing to what it has to offer. Consider the architects playing softball in Central Park fields lovingly manicured by the Central Park Conservancy, or the novelists tapping away in the New York Public Library’s glorious reading room. In an era of permanently constrained budgets and gaping deficits, these pleasurable activities are subsidized by friendly local plutocrats. You may be barely able to afford to live here, thanks to the very rich, but thanks to them, you don’t have to stay holed up in your studio apartment.
The rich subsidize our public services, too—and graciously don’t use them much. Mayor Bloomberg may pride himself on riding the subway, but your average hedge-fund managing director is not a connoisseur of mass transit.
Thank God for billionaires! (And by the way, let's cut poor Michael Bloomberg some slack). There is one key factor missing in New York's fawning, bosom-heaving account: you and me. That is to say, labor and consumers. The super-rich become that way either by inheriting their money in obsequious imitation of the European monarchical systems we once saw fit to overthrow, or by taking advantage of a supply of both labor and consumer demand. That is to say: no one who is rich deserves to be rich; no billionaire works any harder than an undocumented immigrant hauling bricks six days a week for 12 hours a day. Lucky, smart, educated connected, committed, motivated - yeah. More deserving, harder working? Nah. The Pope had it right.
Democrats have traditionally claimed the right to represent both workers and consumers, holding big business to account and sticking up the the little guy. Well, that's the theory. The practice is a little more slippery and last year, a plutocrat Republican who cut taxes to the super-rich cleverly used social conservatism to win a second term. The very middle class that - in theory - is hurt by policies that make it harder to declare bankruptcy, to sue careless doctors, and to assume a higher tax burden, split between Democrats and Republicans, George Bush squeaked in, and the Republicans continued to dominate Congress.
Happily, someone is watching. The Drum Major Institute for Public Policy (disclosure: I sit on its board) released its second annual Congressional report card on issues affecting America's middle class. By all means read it; today's Washington Post picked it up. And yeah, Democrats come out better than Republicans. While some are predicting very hard times in the U.S. economy ahead, the report shows that 2004 was no picnic for the middle class. Dig these stats:
- Real hourly wages adjusted for inflation fell .8 percent
- Cost of medical care rose 4.2 percent
- College costs rose 8.2 percent
- 1.3 million jobless Americans used up their unemployment insurance without finding work
- One in six middle class households lacked health insurance
- 6 million Americans lost their right to overtime pay
Yeah, I can hear you saying that in a free society there will always be winners and losers; that the benefits of our capitalist system outweigh the difficulties. Generally, I agree. But as the gap between the very rich and the barely-getting-by grows - and as the latter group broadens - it's not enough to say the poor will always be with us. And it's not enough to celebrate how many jobs a rich person's spending habits will create.
UPDATE: The Bull Moose, my fave conservative Democrat, former Republican centrist blogger, has a great post on the elimination of the estate tax. The rich do indeed get richer. Quoth the Moose:
Amidst all of the recent talk of death and morality, we arrive at the moment to eternally preserve salvation for the heirs of multi-million dollar estates. Maybe the Schiavo family won't benefit from this sacred action, but this is the true reason that G-d placed Republicans on earth - to reward those who did nothing but be born into the right family.
UPDATE II: Jim Wolcott gets into it and nails the wealth-lust thusly:
I share Tom Watson's yecch reaction to this week's cover story of New York magazine luxury class of ultra-rich, which I read attentively in the checkout line while waiting for some dimwit ahead of me to punch in the correct PIN number to purchase a bag of potato chips, a gallon of orange soda, and an apple. Written by Daniel Gross with his tongue hanging out, the article flaunts the wealth of the ultra-rich in our faces (as if they don't flaunt it enough themselves), but enjoins us to feel grateful for the wind-burn.
