Dan Yankelovich warns of a scenario whereby economic distress, opportunity gaps, political polarization and an erosion of norms combine to create a formula for troubled times.
Our current form of capitalism undermines America’s core ethic. It has become ridden with obstacles to social mobility. A strong commitment to fairness is essential to our nation’s conception of the common good; a less democracy-friendly capitalism violates the common good in favor of top tier of the income scale.
Large inequalities of income, by themselves, do not violate America’s sense of fairness. Billionaires like Bill Gates and Warren Buffett are actually folk heroes. Large inequalities become unfair in people’s minds only when they feel that they themselves are stuck in a rut with no opportunity to improve their lot in life.
In his most recent State of the Union address, President Obama was wise to focus on social mobility rather than income inequality. Income inequality – the huge gap between rich and poor – troubles the more liberal wing of the democratic party. Opportunity inequality troubles everyone – liberals, moderates and conservatives alike.
Our economy’s recovery from the Great Recession of 2007-08 has been discouragingly slow. The recession was quite serious and the reasons for a slow recovery may yet prove to be cyclical and self-healing. If so, my hypothesis that we are witnessing a structural change in our system of capitalism may prove incorrect. Time will tell.
If my hypothesis is valid, however, we may well see higher growth rates in the next few years. But long-term unemployment will persist and wages will continue to stagnate for all but the top quintiles of the work force.
Such a scenario threatens our political stability. Inevitably, populist movements will arise both from the left and the right, further polarizing our political system. Convictions of unfairness will inflame political unrest and add to the economic distress caused by the growing gap in opportunity for self-betterment.
Add anomie to this scenario – the general erosion of norms – and you have a formula for troubled times ahead.