Many observers focus on the economic causes of the widening wealth inequality, but the divide appears to be both cultural and financial.
According to demographer Joel Kotkin, California has become a two-and-a-half-class society, with a thin slice of "entrenched incumbents" on top (the "half class"), a dwindling middle class of public employees and private-sector professionals/technocrats, and an expanding permanent welfare class: about 40% of Californians don't pay any income tax and a quarter are on the Federal Medicaid program.I would break it down somewhat differently, into a three-and-a-half class society: the "entrenched incumbents" on top (the "half class"), the high-earners who pay most of the taxes (the first class), the working poor who pay Social Security payroll taxes and sales taxes (the second class), and State dependents who pay nothing (the third class).
This class structure has political ramifications. In effect, those paying most of the tax are in a pressure cooker: the lid is sealed by the "entrenched incumbents" on top, and the fire beneath is the Central State's insatiable need for more tax revenues to support the entrenched incumbents and its growing army of dependents.
If the citizenry cannot replace a dysfunctional government and/or limit the power of the financial Aristocracy at the ballot box, the nation is a democracy in name only.
A growing number of San Franciscans are fed up, not just with startups, but with techies in general. With their apps and (company) buses, their gourmet coffee and skinny jeans, their venture capital wishes and IPO dreams. They're tired of watching rents soar, friends forced to relocate and beloved neighborhoods drained of diversity.I understand the frustration, but wonder: Are we embracing a soft xenophobia applied to a sector rather than a race, to some cohesive elite tech class that doesn't exist outside of our own minds?
The buses roll up to San Francisco’s bus stops in the morning and evening, but they are unmarked, or nearly so, and not for the public. They have no signs or have discreet acronyms on the front windshield, and because they also have no rear doors they ingest and disgorge their passengers slowly, while the brightly lit funky orange public buses wait behind them. The luxury coach passengers ride for free and many take out their laptops and begin their work day on board; there is of course wifi. Most of them are gleaming white, with dark-tinted windows, like limousines, and some days I think of them as the spaceships on which our alien overlords have landed to rule over us.
Sometimes the Google Bus just seems like one face of Janus-headed capitalism; it contains the people too valuable even to use public transport or drive themselves. In the same spaces wander homeless people undeserving of private space, or the minimum comfort and security; right by the Google bus stop on Cesar Chavez Street immigrant men from Latin America stand waiting for employers in the building trade to scoop them up, or to be arrested and deported by the government. Both sides of the divide are bleak, and the middle way is hard to find.
Things are falling apart--that is obvious. But why are they falling apart? The reasons are complex and global. Our economy and society have structural problems that cannot be solved by adding debt to debt. We are becoming poorer, not just from financial over-reach, but from fundamental forces that are not easy to identify or understand. We will cover the five core reasons why things are falling apart:
1. Debt and financialization
2. Crony capitalism and the elimination of accountability
3. Diminishing returns
5. Technological, financial and demographic changes in our economy
Complex systems weakened by diminishing returns collapse under their own weight and are replaced by systems that are simpler, faster and affordable. If we cling to the old ways, our system will disintegrate. If we want sustainable prosperity rather than collapse, we must embrace a new model that is Decentralized, Adaptive, Transparent and Accountable (DATA).
We are not powerless. Not accepting responsibility and being powerless are two sides of the same coin: once we accept responsibility, we become powerful.
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