Read these excerpts and then proceed directly to Naked Capitalism for the rest. The essential, primal split in America is not about race, color or creed. It is the one between loaners and borrowers. Examined closely enough, all our political battles trace back to that. There are many more of us borrowers than loaners, of course, but we are slow learners.
Today, in 2013, debt numbers all over are at levels that nobody would have believed possible only 30 years ago. Household debt, national debt and corporate debt hang around our necks like so many nooses, and all we can do to prevent ourselves from suffocating is to borrow more. And so, inevitably, debt levels rise further. And just as inevitably, more and more people fall by the wayside; they canít keep up anymore. They are either too much in debt already, or they canít find a job that pays enough ó provided they find a job at all ó or both. In the process, we have become, the vast majority of us, entire societies of debt slaves, living in constant fear of losing a job and/or a home, and/or contracting a disease.
And itís not just paying back their own debt which people find ever harder: much of the debt from the financial ó and overall corporate ó sector has been transferred to the public sector, first becoming national debt and then trickling down into household debt through taxes and cuts to servicesÖ
Itís ironic that one of the undoubtedly most capitalist countries on the planet, Switzerland, appears to take wealth redistribution more serious than any other, with a slew of referendums (yes, they have actual democracy) aimed at decreasing income inequality. In March, one such referendum forced public companies to give shareholders a binding vote on executive compensation. In November, thereís a vote on the 1:12 initiative, which stipulates that executives canít make more than 12 times the salary of the lowest-paid employee. Which somewhat perversely means executives have a very good reason to raise that lowest salary: they themselves can get 12 dollars for every single dollar they give the employee, so an extra $1000 per month for the latter translates into $144,000 extra per year for the bosses.