Mark Blyth (6): Going to school on “Occupy Wall St.”

Click to listen to Chris’ conversation with Mark Blyth (20 minutes, 8 mb mp3)

I arrived in the States twenty years ago, to the month. When I look at the wealth and income distribution in the United States today, I’m looking at Mexico in the 1970s and Brazil in the 1960s. This is not America. This is not a land of opportunity. You can’t talk about opportunity when 60 percent of the population can’t afford to go to college, where the costs of basically a middle-class education far outstrip the resources of the average family; when you have 54-million people living, in a family of four, on less than $22,314 a year; and meanwhile, the top one percent have trebled their share of income…

Mark Blyth with Chris Lydon at the Watson Institute

Mark Blyth, political economist and ever the argumentative Scot, has gone humble before the Wall Street protest. He and we should be learning from the crowd in Zuccotti Park — and in Boston’s Dewey Square — just what people have discovered from their own experience, their own anxiety.

There’s a crisis of income growth in this country that’s papered over by credit. That’s why there’s $56-billion in student loan debt. That’s why there’s $14-trillion in mortgage debt. That’s why there’s more than $1-trillion in home equity lines of credit outstanding. Because people have been borrowing against an uncertain future to finance an ever more expensive present. At the same time income has stagnated. Let’s be clear. When you adjust wages for prices, when you look at the real wage, it’s stagnant for 40 percent of the population; and for the next 20 percent of the population it’s barely edged up over 25 years. Meanwhile the top one percent has increased its share from the late 1970s, from 9 percent of national income to 24 percent just now. You can’t say these things are not causally related… Economically, inequality is a bad thing. You don’t even need to make a moral argument. You don’t have to mention the word justice once. More equal societies grow faster. They’re better…”

It turns out that Americans have more reverence for “fairness” than for equality. We’re not Sweden, and perhaps just as well, Mark Blyth allows. “But we get out of shape when we realize that the risks are being socialized and the profits are being privatized. And that’s what’s happening on Wall Street… “

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  • orangescissor

    I agree that there are no simple answers to the movement and economic crisis – for the simple reason that this is the result of years of political and economic disorders spread globally. None of this can just be fixed overnight. The weight of missed opportunities since the end of the cold war (unnecessary wars, rising inequality, crisis government) has consequences that will haunt us for quite some time.

    I’d say if anything we should go back to some classical ideas about government, economics and politics. That a state honors a social contract, protects and arbitrates civil rights; economics goes back to principles of real wages, real product, credit for real investment etc. For the last few years all of that was kind of left behind, and it should be recovered.

  • I love this guy. Also, my son and I marched in our first protest march in Tacoma, WA last Saturday. It felt good.

  • nother

    These protests did not happen after we bailed out the banks, they happened when things went back to “normal.” Like a cheating husband who upon getting caught will be as contrite as he needs to be. Then it’s back to the babes.

    I had a beer recently with a lobbyist. He was a friend of a friend, a real gruff cutthroat kinda dude. He’s a big better on football and I actually thought he was a bookie at first. I asked him what his job entails and told me that he meets with these politicians and gives them all the information on the client he is representing. I asked him why the politicians talk to him, what do they get out of it? He told me that the main thing he’s learned since doing this job is that politicians are not nearly as smart as people think they are, and they want to talk to him so they know something about an issue. Then with a half smile he said, “So I tell them what they need to know.” Btw, I asked him what he did before this and said nothing, he told me that he and his boss have always been lobbyists. I find that very telling – they are basically salesmen.

    Later I asked a recent Harvard grad if anyone he went to school with was planning on going into politics. He said no and looked at me like I was crazy for even asking the question. There is your vacuum of brain power and that works well for the current system.

    We are not being governed any longer, we are being managed. Wall Street uses our government like a division of operations. These protesters want Wall Street and lobbyists out of our government. “We are the 99” is another way of saying “We the People.”

  • Tom

    I loved your statement “risks are being socialized and the profits are being privatized.” I’m frustrated at how many people, some of my family members included, still “don’t get it”. They think the Occupy Wall Street protestors are slackers!?! And these are people who have lost small fortunes in stocks, pensions, and the value of their house. I don’t understand why they aren’t outraged.

  • Potter

    This for me connects to the Lawrence Lessig (“Republic Lost”) interview I just heard on the Diane Rehm show yesterday (I recommend that- and wish that Chris would grab him for the inimitable treatment).

    Two points I get here are these: 1) let’s wait and see what happens with a (sort of) neutral mind. 2) there are similarities between some of those of the “Tea Party” and what some in the “Occupy Wall Street” protest are saying. The suggestion is that perhaps there is room for melding. Thus there is also the possibility of drawing some away from the Tea Party especially as it seems increasingly spent or characterized as naive and know-nothing. And maybe above all there needs to be focus and education of those with raw emotions of anger.

    I think Lawrence Lessig’s book maybe important… There is an excerpt on Rehm and also on Amazon.

    Thank you as always especially for Mark Blyth’s view on the moment….

  • Very interesting interview!

    Blyth explains all of this in the way I would when I’m thinking most clearly and feeling most sympathetic to all individuals and groups involved. He expresses a basic kind of confidence and faith in America that is most often found in immigrants. Cenk Uygur is another example that comes to mind. It’s easier for an immigrant to stand outside in order to see a society in more neutral terms.

    It also helps Blyth see all of this in a larger global context. As he explains, unions may have been shrinking in the US but around the world they’ve been growing. Losses and gains are best looked at in the big picture where social trends can more easily be discerned.

    I do have some doubts about the potential connection between the Occupy movement and the Tea Party movement.

    There are some people who have moved support from one group to another and there also may be some who support both at the same time, but these people aren’t the loyalists who make up the base of a movement. There is a fundamental demographic divide between the core activists of the two movements. The Tea Party is older, whiter, socially conservative, fundamentalist, more conservative than the average Republican, and highly partisan. The Occupy movement is younger, racially diverse, socially liberal, more secular (although inclusive of social justice Christians), and highly non-partisan (at least for the time being). Polls even showed that Tea Party supporters are more racially biased than the average American. That is far from the large scale populism that is being attempted by the Occupy movement.

    The Tea Party started out with the potential of populism and some elements of it still are populist, but the leadership of the movement was coopted away from populism (by corporate intersts and, worse still, the religious right culture warriors). The Occupy movement has so far been more protective of its populist origins and intent. It will be much harder to coopt the Occupy movement, especially as these new activists have learned well the mistakes of the Tea Party. Also, the Occupy movement is much more ideologically diverse than the Tea Party ever was. It’s easier to imagine Tea Party supporters being welcomed into the Occupy movement than Occupy supporters being welcomed into the Tea Party movement. The other difference is that the Occupy movement has not only populist support in America but around the world. The Tea Party never had that much wide support and certainly not that much active support. The Tea Party was always a relatively small movement that was made to look larger by Fox News. The Occupy movement is the manifestation of the potential of what the Tea Party might have become.

    Like many liberals, left-wingers, libertarians and independents, I support the populist elements in the Tea Party. However, the Tea Party movement as a whole is no longer populist. Maybe the Occupy movement could help those Tea Party populists to regain their movement, but are they willing to accept help from another movement? All the vocal leadership of the Tea Party that I’ve heard so far has criticized the Occupy movement. The Tea Party populists need to speak up for the Occupy movement, and the Occupy supporters need to speak out for that same populist outrage that birthed the Tea Party.

    People like Blyth want to preach the message of everyone getting along. That is a message that appeals strongly to liberals but no so strongly to those on the right. Liberals are the only political demographic in the US that has majority support for compromise. Not even a majority of American independents favor compromise. So, how does Blyth recommend that liberals convince the rest of Americans that cooperating is actually a good thing?

  • I need a video of these talks I can point people to. Somehow it seems difficult to introduce my friends to Blyth through a podcast. They want to watch something…

    As always, a great talk.

    • I agree with Mike, I need a quick link/reference for this. Blyth’s outside critique of OWS was the most objective, reasonable, logical one I’ve heard so far.

  • Blyth may have just coined my next protest sign:
    “Risk is being socialized yet the profits are being privatized. WTF?”

    Thank you sir, I’m going to actively search for your blogs, writings, teachings, opinions, whatever, and share them with friends and adversaries.


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  • nother
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  • TheParrot

    Wonderful, if not at times an irritating discussion. Thank you Chris & Mark.

    Here’s a demographic data point for Mark: I’m center left (probably way further than Mark, but who knows?). I practice regular hygiene on a daily basis if circumstances permit. The U.S. is my country of origin. I do consider fairness and equality to be risks worth working towards achieving in their optimal distribution. I don’t find Swedes, nor other Scandinavians boring, but I can understand how a person with Scottish brogue might. I see capitalism, socialism, communism, corporatism, religious state systems, feudalism, monarchs, etc as failures that don’t need to be repeated (what should replace them? how should I know). I don’t associate with anarchists, yet I’ve spent enough time around various venues to realize the hierarchies we’ve engineered for ourselves need to be flattened to something much closer to zero. I’ve been in some board rooms (never as a board member) and they worry about rule number one, to which there’s no other rule, and it is: how’s the ROI going today? I appreciate specialization (dentistry, economics, etc) yet recognize it’s hegemonic emergence as a fly-in-the-ointment. I work hard, though my earnings have been declining. My future looks bleak financially because my current financial portfolio looks to be buckling under some sort of external strain I cannot quite figure out. Zero-sum outcomes are for one-up/one-down personality types. And as my favorite history teacher in college used to say: and so on and so forth …