Tag: middle class

What Is “Class”? – the American Mis-Confusion


So, somehow I overheard ( which is shocking, believe me, because I don’t really expose myself to this kind of news) that a few weeks ago “people” (who are they? some social media trolls?) got upset with Cate Blanchett (“they” always have a tendency of being upset for all the wrong reasons) on account of her calling herself “middle class”… And I thought: Aha! An excellent opportunity to clarify a thing or two!

Let me first confess: I have never been a big fan of Cate Blanchett as an actress… She has a good screen presence, no matter the setting, but that’s about it . And I’ve even seen her on stage a couple of times too… Including in Liv Ullman’s production of A Streetcar Named Desire, nearly 15 years ago. The critics and the audience raved about it, of course, but, as far as I was concerned, she lacked the emotional fragility necessary for the portrayal of a woman broken in that specific way of Blanche DuBois. I even got  myself in trouble with my fellow BAM patrons by not restraining my opinionated ass on account of that performance…  

But no matter, no matter – as this is not about her acting. This is about her socio-political statements…

(And that’s another thing: Why the hell do people always care so much about what the actors have to say about politics, or social structures, or international relations… Why the fuck the general public bothers itself with listening to  what Barbra Streisand, Bette Midler, Angelina Jolie, Ashley Judd, Madonna, or Cate Blanchett have to say about any of that instead of trying to utilize their own analytical capabilities and form their own opinions?)

So, here is how she described herself, while discussing her experiences of “working with refugees” (of some non-specific kind; yet, her Cannes’ red-carpet dress speaks volumes with that bright and glossy forest-green inset she kept revealing): “I am white, I am privileged, I am middle class…” And somehow it wasn’t the falsely apologetic tone of the whole thing, but the supposed mis-“classification” that got the people upset. Why? “They” explain: the actress’s estimated net worth is $95 million. And “they” think that it disqualifies her as the “middle class”.

Well, let’s see… Even though half-American (on her father’s side), Cate Blanchett was born, raised, and educated in Melbourne, Australia, and is encyclopedically considered an Australian actress. And in that country, as in all former and present parts of the British Empire, societal divisions are still very much defined by one’s familial origins, the ancestry and the hereditary structures. It really has nothing to do with the size of one’s coffers. There are two million millionaires in Australia – the prevailing majority of them are commoners. At the same time a blue-blood aristocrat can be dirt-poor. Therefore, by  these standards Blanchett is absolutely correct, deliberately honest, and entirely un-hypocritical – she is very much a middle-class product: mother’s a teacher, father was a US Navy officer turned an ad exec.

Furthermore, the only American billionaire I knew personally (through a theater charity as a matter of fact) also tried to instill in his three children the idea that they were of the “middle class”. He understood the hereditary class principles simply because his immense wealth placed him very close to the heart of the issue: he knew that his money didn’t make him the upper-class.

And since we’re talking about a screen/stage actor, here’s an example from another frequently produced classical play – Anton Chekhov’s The Cherry Orchard… Keep in mind that Russia had been a monarchy with centuries-old ancestral aristocracy up until just 107 years ago… The play’s central psycho-social conflict is focused on the impoverished hereditary landowners unable to hold on to their estates, including the symbolically precious cherry orchards. Meanwhile,  the wealthy merchant Yermolai Lopakhin, with his peasant familial roots, understands only too well that, in spite of his hard work and all his millions, he can raise himself in the old societal class hierarchy only as far as the middle…  Just like the billionaire I’ve mentioned above… Let me reiterate: the wealth doesn’t make one an aristocrat. 

Generally speaking, the monetary approach to defining societal classes is very much the New World’s notion, which makes me believe that Cate Blanchett’s self-appointed critics are predominantly American. Not surprising at all.

The fact that here, in the States, the vast majority of people consider personal wealth to be the primal factor of the class distinctions is the testimony to two attributes very particular to our country:

A. The strength of our democratic, equal-opportunity roots. In spite of all sorts of privileges and preferential treatments applicable to various and variably defined through the stages of our history societal groups; and with full acknowledgment of the suffocating nepotism that’s been stagnating our progress for decades now – we are still the most democratic country in the world. The state built without castes, aristocratic substructures, and governing rights based on the land ownership. A nation, which believes that a self-made celebrity is equal to the blue-blood royalty. We see nothing especially special in Beyoncé/Jay Z meeting up and chatting with Kate Middleton/Prince William. Hip-pop royalty, sovereign royalty – same difference… 

B. Our preoccupation with money above everything else. And this one is a trait that affects pretty much every single aspect of our nation’s existence – socio-economic, political, and intellectual – not just the interpretations of the societal segregation into classes.

Case in point:

“It is without a doubt a reflection of our society’s values that lesser punishments are doled out to those who take away someone’s innocence, or even life, than to those who take someone’s money.”  

                                                                            I Built This Prison, Part III, p. 344

But let’s assume for a second that everyone around the world adopted the American way of thinking and dismissed the old-world traditions of the class division entirely… For the moment, let’s just focus exclusively on the money factor…

Does general public really think that all those doctors at struggling hospitals and private practices, faceless partners in large law firms, CFO’s of the companies barely breaking even – that they are the middle class?! Why? Because they  make lower, or even mid, six-figure salaries? Let me disillusion you about that! In a larger scheme of things, we are all poor – from welfare recipient to an owner of a multi-million-dollar company with a $500K annual salary. Monetarily, we are all the struggling lower class, with just a slight difference in the purchasing powers. None of us can afford to fly everywhere in the first class (let alone the private jets), stay in suites of the 5-star hotels, dine in restaurants with Michelin stars, casually buy designer bags and suits (especially at today’s prices)… Unless, of course, these luxuries are paid by some companies or some other persons… Moreover, children of the welfare recipients have better medical care through the states or the cities and broader access to the educational finances than those of the wage-paid parents…

And Cate Blanchett with her who knows how securely kept millions is somewhere in the median sector of the wealth curve… Truly of the middle class, no matter how you define the matter. Because the ones in the upper portion of the plentitude are what I call “the really rich people” – the sort of folks the dreamers insert into their billionaire fairy-tale romance novels.   

 

Tragicomedy of Obama’s Fiscal Cliff “Win”



A20120613_federal_spending_pigccording to common definitions, a tragicomedy is supposed to have both funny and sad elements, making you laugh and then cry, or the other way around.  For me personally, this genre achieves the strongest effect when it generates a subtle emotional shift: one minute you are laughing your head off and in the next moment, even though nothing drastic happens, you find yourself with a face full of tears; you don't even notice how it happens.  You know what I'm talking about…  All Russian "comedies" are tragicomedies and so are Salvador Dali's paintings.  Fellini was a master of the genre - that is because he understood that Life itself is a tragicomedy.  What a movie he could've made out of this fiscal "cliff-hanging" bullshit!

First I was chuckling softly to myself on account of the make-believe "impasse" antics so eagerly played out by the White House and the Capitol up until December 31st after more than 500 (!) days of supposedly diligent preparations.  We know we cannot take this seriously anymore – we've seen this happening before.  Why are they threatening each other?  What were they going to do if they didn't reach some sort of a half-ass decision?  Jump out of their windows?  We are not that lucky. 

I was roaring with laughter when our Nation's executives, who have US Treasury, the Federal Reserve,  IRS, Government Accountability Office, a bunch of Nobel Prize Laureates in Economics and what have you at their disposal, shyly admitted that for decades they've been forgetting about the goddamn INFLATION (!!!) whenever they tried to separate the middle-class from the wealthy or establish alternative-minimum tax (ATM) exclusions.  Now the stupid $250K mark of "the rich" I previously cursed is out of the window replaced with more sensible $400K.  The ATM scheme got eased up as well and it will be indexed to the value of money from now on.         

I hope you agree with me that the 5% increase of the capital gains tax rate from 15% to 20% for the upper class is also a laughable point.  Some commentators declare that the proverbial "1%" lost.  I say, "Bravo!  Great win, you, guys – just 5%!"  Apparently, it's Ok to tax the top tier of my earnings at 35%, while someone with $1 billion of assets and $100 million of annual gains contributes 20%!  Do we really think that additional $5 million will make that much difference in a life of a family that can afford anything they could possibly imagine?  I mean, Dolce and Gabbana just became billionaires on account of increased demand for luxury goods!   

On the other hand, someone who makes $100k a year will really miss the $2,000 that will be taken out of his net earnings due to the reversal of the Social Security tax rates after only two years of relief.  You cannot help feeling a little sad about it, especially when you consider that 77% of American households are affected by this change.  If each of these families loses on average around $1,000 of disposal income, it will translate into nearly $90 billion drop in consumption of goods and services.  I felt kind of embarrassed, though, shedding a tear about it.  After all, we've been contributing 6.2% into Social Security fund forever.  We knew that the 4.2% rate was only a temporary abatement.    

But now, three weeks later, I cannot shake off a feeling of  desperation.  Oh, there were no new developments or anything like that – everyone in Washington was too busy preparing for the inaugural celebrations.  It's just that the general public's hopeless ignorance became evident once again and it is tragic.  It appears that the immediate reduction of the paychecks is one and only concern for the majority of people.  The short-term loss is blinding - it works as a diversion from far more important issues.

People forgot that the fiscal cliff deal wasn't just about the government's revenues.  The other side of it, the one that deals with the federal spendings, wasn't and still hasn't been addressed at all.  If no solution is developed, the Nation will require to borrow again, even though the already raised Debt Ceiling has been (surprise!) reached. 

But I have much scarier questions.  Why the hell the government is using my Social Security contributions to plug their fiscal deficits?  Why are they funding somebody else's payments with my money?  What happened to the money current retirees contributed from their own paychecks?  Where did they go?  Oh, don't worry – I'm well informed.  These are rhetorical questions.  I know that my generation is the last one that MAY BE able to get federal retirement benefits and that our children do not stand a chance to get even 50% of what they shell out of their earnings.  But why are we not wailing about it on every corner? 

Newsflash: GOP Begs Obama for Tax Cuts via Radio? Seriously?


ImagesDear readers!  We interrupt our previously scheduled postings for a series of very special announcements:

Radio waves are the last political resort. 

Apparently all other political channels are either broken or backed up by "more important" problems.  This passed Saturday, frustrated by the House/Senate stalemate, GOP asked Obama to keep Bush tax cuts intact via their radio address.   Is that what's going to work?  What is this the 1920s and everyone is glued to their Radiolas?    

Clearly, the issue that affects not just the monetary policies of this country, but also "minor" sociopolitical concerns such as, for example, the economic principles of true capitalism and definitions of social classes, cannot be successfully discussed in the policy-making branches of our government – the partisanism overpowers the reason.  So, the republicans decide to address the President directly… on the radio.  Moreover, on Saturday.  Don't they know that radio is primarily a weekday medium?  Most listeners tune in either on their way to and from work, or online in their offices.      

On the other hand, who the fuck cares? It's just an empty, check-mark step.  In reality, everyone is resigned to wait until November elections for the resolution anyway, because it's not the fiscal reasoning or survival logic that will dictate the decision.  The only thing that matters for the outcome of the tax-cut issue is which party prevails.  Meanwhile, GOP is trying to impress on their constituents that they are "doing something about it."   Just don't call it "pressing Obama" – that's way too blatant even for politicians.

Proof-positive: politicians are not real people.

Nearly 18 months ago, when President Barack Obama first threw the number $250,000 into the tax-cuts discussions, at least some financial publications, including MSN Money, questioned the suitability of that number as a middle-class ceiling.  Now, overwhelmed by the barrage of bad news, nobody talks about the number itself anymore.   

But I was always interested in understanding how the fuck they came up with that number?  What made "them" (whoever they are)  think that $250,000 salary qualifies someone as "wealthy?"  What kind of perverse minds decided that a small-business CEO, a senior financial executive, an adman, an average doctor, a sales person who spends 300 days a year on the road, don't belong in the middle class?  Are they an upper-crust?  Is it correct to bunch them up together with the private-equity billionaires or public companies' CEOs and make them pay taxes at the same rates? 

Yes, the majority of the general population will never make over $250,000.  But the same majority do not possess talents, perseverance, and drive of people who apply themselves to the best of their abilities and work 16 hours a day in order to make 6, 10, or even 15 times more than an average schmuck, who doesn't really try too hard and spends his workday surfing the Internet for TMZ news and shopping bargains.   

In fact, people who make $100,000 – $750,000 a year are usually the hardest-working sector of the middle class.  Most of them have built their careers or businesses from scratch.  And guess what?  They are not really that reach.  I know CFOs, doctors, lawyers, who make $300-$350K a year and worry that they will not be able to afford $245,000 a head in tuition, room, and board to send their children through a good college.   

And here lies the truth: the reason a random number is picked to determine who belongs to the middle class and who doesn't is because politicians are not real people.  Just like the super-rich, they are far removed from the reality of the every-day life.  Many of them are actually wealthy people.  And even those who are theoretically "middle-class" enjoy a lot of paid perks.  How can you possibly formulate the idea of social classes if most of your meals are paid by lobbyists and their clients?   

Administration doesn't care about the economic recovery of this country.

In principle, I would be very reluctant to agree with any official political statement.  But, whoever is actually behind the text of the GOP radio address got one thing right: small-business owners will be the first to suffer from increased taxes imposed on the earnings above $250,000.  Maybe the plastic people in Washington don't know this, but the majority of privately-held businesses are S-Corporations and transfer their incomes to owners' individual tax returns.

So, let's imagine such small business ran by two single partners, who work very hard to keep their business going, retain their 15 employees, and maybe even create new jobs.  If they are very good at what they do and also lucky, they may overcome all the difficulties of today's economic conditions and make $1,000,000 in net income. Good for them! 

Now comes the tax season.  Even though they left the entire million in the business, they have to split it and report $500K each  on their individual tax returns.  If the proposed tax rates are applied, together they will have to pay $335K to the federal government.  Add to that, state and local taxes – about $150K more, and the hard-earned $1,000,000 is immediately reduced to $515,000.  The $485K is taken away from the struggling business.

So, where is the incentive for the entrepreneurs to go on or go into the business?  What about the "middle-class" employees of these small businesses, those who make under $250K?  What will happened to them, when their employers go out of business squashed by these additional fiscal burdens on top of all other difficulties?  Do you think that the government cares about them, or the "economic recovery" altogether?  Or do they care about having enough money to bail out the next banking giant or a failing automaker?