The Rich Get Rich, The Poor Get Sorer

In Dickens’ classic
A Christmas Carol, the ghost of Jacob Marley appears in the middle of the night to Ebenezer Scrooge. As his former colleague rattles his chains and laments the waste of his life, Scrooge fumbles for a proper response.

“‘But you were always a good man of business, Jacob,’ he says. ‘Business!’ cried the ghost, wringing its hands. ‘Mankind was my business. The common welfare was my business: charity, mercy, forbearance and benevolence were all my business. The dealings of my trade were but a drop of water in the comprehensive ocean of my business!’”

It’s a remarkable confession. Marley’s ledger book tinkering was a drop of water; the “common welfare” of others was the ocean. In his failure to feel the slightest bit of empathy for his fellow beings, Marley’s spiritual error was much greater than refusing to toss change at street urchins or not attending charity balls.

It’s a theme that goes far beyond cheap, seasonal sentiment. From Christ kicking over the moneychangers’ tables in the New Testament, to King Midas’s golden touch, to Jimmy Stewart’s struggle with a greedy bank owner in It’s a Wonderful Life, the message resonates across the centuries: the desire for wealth and capital, untethered from communal purpose, is corrosive to the human spirit.

It’s been such a persistent theme in western literature, art, music and religious parable; who could doubt its truth? But in the “real world” of tough-minded high finance, where “money talks and bullshit walks,” we might as well be talking about greeting card sentiments. As the gap grows between the rich and the poor – both within nations and between them – the distribution of wealth and resources approaches disparities not seen since the “Gilded Age” of the late nineteenth century.

According to German federal legislator and author Norbert Blüm, there are almost 899 billionaires in the world; 102 names were added to the list of the billionaires’ club in 2006 alone. Meanwhile, the bottom half of three billion people manage on less than two dollars a day, with 1.3 billion having less than one dollar a day. The 358 richest families own one half of the world’s assets. The world’s 500 largest private companies control 52 percent of the world’s national product. In the US, according to a 2006 report in the New York Times, “The average top executive’s salary at a big company was more than 170 times the average worker’s earnings in 2004, up from a multiple of 68 in 1940, according to a study last year by Carola Frydman, a doctoral candidate at Harvard, and Raven E. Saks, an economist at the Federal Reserve.”

If Marley’s ghost materialized today in the corporate boardrooms or legislative halls, there’s little doubt he’d wail and rattle his chains over the disparities created by Scrooge’s spiritual descendents. But although the problem is global, there are still places where there has been successful resistance. We’ll get to that later.

An instructive case of the current class divide in the US can be found in the recent indictment of David H. Brooks, 53, former CEO of DHB Industries. The company was the leading supplier of body armour to the US military and the “Interceptor Vest” was its flagship product.

Brooks and his former chief operating officer Sandra Hatfield have been charged with manipulating DHB’s financial records to increase earnings and profit margins, thereby inflating the price of DHB’s stock. When an employee told Hatfield the inventory of vests was overvalued, she allegedly responded that the company could not “take a hit” of reducing the valuation to the correct amount. During this time, the pair sold several million shares of DHB stock. Brooks made $185 million from this sale.

According to a report in
The Trentonian, “Brooks also is accused of using DHB funds to buy or lease luxury vehicles for himself and family members, and to pay for vacations, jewellery, cosmetic surgery, country club bills and family celebrations. He also used DHB funds for his private horse racing business, prosecutors said.”

In May of 2005, the US Marines recalled more than 5,000 DHB armoured vests after doubts were raised about their effectiveness. The suits allegedly couldn’t take a hit from a nine-mm round. “By that time, Brooks had pocketed over $250 million in war windfalls, “wrote reporter Anthony Lappé.

In 2005, in what Lappé called the “… world’s most obscene coming of age party,” Brooks lavished $10 million dollars on his daughter’s bat mitzvah. Among the performers flown in to New York’s Rainbow Room to entertain the girl and three hundred of her closest friends, were Don Henley, Stevie Nicks, Kenny G, Aerosmith and rapper 50 Cent. Tom Petty hosted the celebration.

Could there be any more cogent example of what author Naomi Klein calls “disaster capitalism” than a war profiteer organizing a musical Rome-in-decline spectacle for his little girl? (One of the most obvious examples of disaster capitalism is the fallout from Katrina, when privatizing vultures descended on the public purse in New Orleans.)

While Brooks’ indictment made news, the leisure time excesses of the hyper-rich usually go unreported. The top one percent has done something of a disappearing act, secluding themselves in gated mansions, holidaying in high-end resorts and heading to swank events escorted by private security. Their absence from the scene, if not from the society page, creates a social blank screen upon which the rest of us can project our shadows. (Brooks is a piece of work, but it doesn’t bode well if the class war convinces either side that they are up against inhuman monsters.)

Yet there is little doubt that the comfortable isolation of money, power and influence creates a kind of hermetically sealed world, where the elite are rarely exposed to the experiences and opinions of anyone other than “nice” people like themselves. And after the first few billion, money has little to do with the trifling sums required for food, shelter and leisure. It becomes a kind of numerical peg for status. It’s a way of keeping score, through buying everything from conglomerates to the company of rapper 50 Cent.

As for those at the bottom of society, they’re doing their own disappearing act. “Our poor are like people in Madagascar,” wrote James Fallows in New York Times Magazine in 2000. “We feel bad for them, but they live someplace else.” The poor, comprised of more whites than ever, have “… become invisible,” according to the reporter – largely through the professional and leisure-time insulation of folks like Fallows, who moves in the charmed circle of East Coast mainstream media.

The class divide in North America has become so wide and so obvious that mainstream media rarely examines it as an institutional problem, if they ever did. It just somehow happened, through the magic of the marketplace. Adam Smith’s “invisible hand,” moving as mysteriously as Marley’s ghost, began to reward the few while smacking down the many.

In October of 2007,
New York Times Magazine revisited the matter of the class divide in the Big Apple, devoting an issue to “City Life in the Second Gilded Age.” It could just as well have called the theme, “Get Used to It.” The cover story was illustrated with a gold-painted manhole cover.

An essay on the Internet by writer Steve Kangas entitled The Origins of the Overclass supplies some necessary historical context. The wealthy in the US have always used many methods to accumulate wealth, he notes, but it was not until the mid-1970s that these methods coalesced into a superbly organized, cohesive and efficient machine.

“After 1975,” Kangas writes, “it became greater than the sum of its parts, a smooth flowing organization of advocacy groups, lobbyists, think tanks, conservative foundations and PR firms that hurtled the richest one percent into the stratosphere.”

Years of legislative gains for consumer groups, environmentalists and labour groups had given the powers that be a bit of a fright. It was time to get busy and apply some tried and true techniques.

“During the 1970s, these men would take the propaganda and operational techniques they had learned in the Cold War and apply them to the Class War. Therefore, it is no surprise that the American version of the machine bears an uncanny resemblance to the foreign versions designed to fight communism,” Kangas notes.

It may have been a war of words, but it was a war nonetheless, and one with real world casualties. When Harper’s former editor Lewis Lapham investigated the history of rightwing think tanks and foundations in the US, he was surprised to discover what was, by definition, a conspiracy: a decades-long effort by the very wealthiest, using millions of dollars and experts-for-hire, to influence policies on taxation, regulation, consumer and labour laws, by constructing a pipeline into media, academia and government. Simply put, the powers that be needed to get things back on track after America’s dangerous experiment in representative democracy. (A similar pattern with think tanks, foundations and public relations firms occurred here in Canada.)

In every generation, members of the overclass rediscover that human evolution has peaked, by happy coincidence, with themselves. From the crib to the country club, they learn through osmosis that the world is their blue-green bauble. No further instruction is required; they can always hire smart people to figure out the details. But it’s not easy work; there are always difficult, dangerous people out there on the outskirts of empire, interfering in the inalienable right of the few to cheap energy, resources and labour.

It takes a lot of time and money to convince the rubes at home in the US and Canada that their interests are the same as those of the overclass. People aren’t that stupid; it takes years of programming through media and PR firms to condition them into the right responses. Consider the term “free trade.” In retrospect, the alphabet soup of trade agreements – NAFTA, CAFTA, FTA and FTAA – was never really about trade, per se, or even freedom and agreement. It was about investment and the global displacement of local markets by corporate conglomerates. Globally, this 30-year program has vastly enriched a small percentage of players at the expense of blue collar workers, who had about as much democratic input into the decision-making as medieval peasants on a feudal estate.

Yet globalization is now widely recognized as a botched experiment, even among the negotiators themselves. In fact, those who believe that protest accomplishes nothing need look no further than the famous “Battle of Seattle” in 1999, which led to a collapse of that year’s WTO meeting. Successive WTO meetings, from Doha to Cancun, ground to a halt when poorer countries refused to sign on to the status quo.

Latin Americans, in particular, refuse to play the same old game. A growing number of nations are rejecting the IMF/World Bank bromides about economic growth opportunities, after experiencing the privatization of public services, resource rape and extortion through debt. The old games of overt and covert oppression don’t work anymore. The election of brown-skinned born peasants to high office, such as Evo Morales in Bolivia and Hugo Chávez in Venezuela, are the most obvious signs of this transformation. From Buenos Aires to Caracas to Managua, the poor are starting to define their own destinies, after decades of exile from positions of influence.

We began with the tale of former CEO David Brooks, the battle vest manufacturer. We’ll end with the story of another man of influence, from the other side of the equator.

It was chilly summer morning in Buenos Aires. After a light breakfast, Dr. René Favaloro walked to his bathroom, put a gun to his chest and pulled the trigger. The shot to his own heart, resounding through Argentina in late July of 2000, made for a tragically ironic end for the 77-year old Favaloro, a word-famous cardiac specialist who was the first doctor in the world to map out and perform heart bypass surgery 33 years earlier in the US.

Favaloro’s suicide resulted in an outpouring of national grief and a flood of visitors with floral wreaths to the front of his clinic. Argentineans put the blame for his suicide squarely on free market economics. Favaloro’s own writings allude to his despair at the increasing privatization of health in Argentina and the fiscal crisis in his own clinic.

The patrician, silver-haired doctor refused to turn away uninsured patients from his clinic, insisting “… the right to live” was a given for all Argentineans. Instituted in 1992, Favaloro’s clinic was Latin America’s most advanced heart institute, training over four hundred doctors, who are now spread across the world. Favaloro hoped his foundation would become a model for public health care globally.

At the insistence of Washington and the IMF, Argentina and much of the rest of Latin America instituted free-market reforms in the early 1990s. Government subsidies to Favaloro’s foundation were slashed while US-style health care practices were introduced. At the same time, millions of Argentineans, pushed out of work by public and private downsizing, lost health care coverage altogether.

Favaloro himself was precise in localizing the blame for the escalating health crisis, in which the treatment of uninsured patients became increasingly untenable. Two weeks before his death, in a memo to his staff, he excoriated economic globalization, stating that free-market reforms are “… better referred to as a neo-feudalism that is bringing this world toward a social disaster where the rich are getting richer and the poor are getting poorer.”

Favaloro wrote to a friend expressing the personal dimensions of this struggle: “I am living one of the worst moments of my life, just as the rest of this nation. I have become a servant knocking on doors looking for money to keep the foundation alive.” His appeals to private donors failed to make up the losses brought on by free-market reforms.

“René had fought hard to give his patients equal treatment,” said Mariano Favaloro, the foundation’s chief of surgery and cousin to the doctor, in a story in the Washington Post. “He felt this new world we live in could no longer permit it, and he ended his life.”

The Post story tells how Ismael Garcia, a 57-year-old farmer from Patagonia, was accepted by René Favaloro as a patient, even though Garcia could not pay. He wept when told about Favaloro’s death.

“I wanted to meet the man who allowed my life to be saved, I wanted to at least shake his hand,” cried Garcia while his daughter held his bandaged neck. “But I never got a chance to do it. Favaloro was too good for this world.”

René Favaloro’s trade as a doctor was small compared to his comprehensive business in making medicine available to those who needed it most. His story had a major influence on Argentineans, giving a human face to the impersonal pressures of finance and foreign capital that wracked their country in the first few years of the millennium. In 2003, the pro-US candidate Carlos Menem failed to win Argentina’s presidential race, signalling the nation’s move toward greater political and economic autonomy. Still, the most dramatic rejection of “The Washington Consensus” has been elsewhere, in Bolivia and Venezuela.

It’s ironic that Latin Americans are learning the lesson that we have yet to fully understand in North America: a lesson about the spiritually and socially destructive aspects of greed, foreshadowed in the work of Dickens. In A Christmas Carol, Marley’s ghost tells Scrooge he has been seven years dead, and swiftly travelling all the time “… in an incessant torment of remorse.” Scrooge helpfully offers that he must have covered a lot of ground in that time. Enraged, Marley’s ghost flings a length of chain heavily to the ground.

“‘Oh! captive, bound, and double-ironed,’ cried the phantom, ‘not to know, that ages of incessant labour, by immortal creatures, for this earth must pass into eternity before the good of which it is susceptible is all developed.

“‘At this time of the rolling year,’ the spectre said, ‘I suffer most. Why did I walk through crowds of fellow-beings with my eyes turned down, and never raise them to that blessed Star which led the Wise Men to a poor abode! Were there no poor homes to which its light would have conducted me!’”

By the end of Dickens’ classic tale, Scrooge has been terrified into an epiphany. His future is not written in stone, and it’s not too late to undo his bad prospects. Against all odds, a bitter, anal-retentive pencil pusher learns to feel compassion for the suffering of others. Though it’s too late for his former colleague, Scrooge has learned a few things about wealth, workers and chains.

Geoff Olson