Polanyi`s
thesis is that the idea of a self-adjusting market implied a stark
utopia. Such an institution could not exist for any length of time without
annihilating the human and natural substance of society; it would have
physically destroyed man and transformed his surroundings into a
wilderness. Inevitably, society took measures to protect itself but
whatever measures it took impaired the self-regulation of the market,
disorganized industrial life, and thus endangered society in yet another
way. It was this dilemma that forced the development of the market
system into a definite groove and finally disrupted the social organization
based upon it. The idea that trade is the source of all well being and that
economic growth can solve virtually every problem from hunger and poverty to
environmental devastation remains the bedrock of the culture of
capitalism. It can certainly fit under the “stories we tell ourselves
about ourselves” cultural phenomenon. American economy spins around the myth-
started by Henry Ford. It is presented as a land of opportunities with free
market, offering stability and prosperity. And yet, no one question what is the
story behind it, and what is the cost of free market. America is certainly the
most developed country in the world, but what about its people? Are they happy
to be work force, and devote their life to working? Giving away their
strengths, but not ending up being happy and rich?
Nineteenth
century social and economic theorists from Auguste Comte, Herbert Spencer, and
Karl Marx, while disagreeing on the processes, all postulated the ultimate
emergence of an industrial society in which life’s necessities would be
supplied to all. In spite of the optimism, however, the nineteenth
century was, according to Polanyi, characterized by societies taking action to
protect itself from the ravages of the market. The story of the twentieth
century, however, might aptly be called the revenge of the market,” as
nation-states frantically implement policies to maintain economic growth and
remove barriers that might hinder the operation and global expansion of the
market”. Under pressure from multilateral institutions such as the
World Bank, IMF, and WTO to whom nation-states have largely ceded their
economic sovereignty, governments have systematically downsized wealth
redistribution programs, state-supported education, public health programs,
environmental safeguards, labor unions, and adopted a host of other neo-liberal
economic policies that are explicitly designed to aid the growth and vitality
of the market. Accompanying this growth, however, has come
unprecedented global poverty, inequality, environmental destruction, social
protest, conflict and other problems reminiscent of those of the worst of the
nineteenth century. Addressing
the paradox requires first recognizing that prime directive of the market
society and the global economy in general is maintaining continual capital
accumulation, creating what Ernest Gellner called a “society of perpetual
growth.” For American economy (and American society indeed) to
function we must produce and consume more this year than last and more next
year than this in perpetuity. Failure to do so will result in
political, economic and social decimation.
Looking
at different examples of implication of the paradox in America, the capital
comes to be quite interesting case of study. The District continues to have one
of the largest gaps between the rich and poor.
Income inequality in large cities is higher only in Atlanta and Boston. Top
earners make 29 times more a year than the lowest earners, according to a new report by local think tank DC
Fiscal Policy Institute. Researchers examined 2010 census data and found some
startling figures that illustrate the city’s income gap. The rich are much richer here. The
richest of D.C. residents, those in the top 5 percent income bracket, make
$473,000 a year, which is the highest in the nation — the average among all
large cities is $292,000. D.C. is only behind San Francisco in how much the top
20 percent make, too. But the bottom 20 percent of earners in D.C. make $9,100,
which is close to the average among large cities. D.C.’s
middle-income households make $61,000 a year, which is higher than in all but
four other large cities. The growing income gap partially reflects a national phenomenon in which the rich
saw their incomes rise at a much faster pace than the poor did over the past
three decades. When taking inflation into account, high-wage earners in D.C.
made 44 percent more in 2009 than they did in the 1979. Low-wage workers, on
the other hand, saw their earnings rise by only 14 percent. The gap between job requirements and skills helps
explain the District’s unemployment disparity. In
2011, unemployment was 24 percent for D.C. residents with just a high school
diploma. For those with a college degree, unemployment was 4 percent. Wages
have also grown at different rates based on education levels. For D.C.
residents with only a high school diploma, wages have increased by only 1
percent since the 1970s (again, adjusting for inflation). But those with
college degrees saw their wages grow by 30 percent. The top 20 percent of
D.C.’s earners make $3.15 for every $1 people in the bottom 20 percent make.
That figure doesn’t change much when comparing how much blacks and whites in D.C. make; for every
$1 a black person in D.C. earns, a white person earns $3.06.
We must
also look at geographical factor. In and around DC area, certain areas
(counties) in Virginia and Maryland are extremely rich and “white”. The problem
comes for average people. Affording housing in DC posses a huge problem for
people with no means, or family background, who come to the capital, and find
jobs there. DC stands as a really liberal and democratic environment.
Nevertheless it is so conservative. Jobs are racially and gender segregated and
divided- white people make more money than blacks and Latinos, men make more
money than women. From a point of DC residents , who don’t have fancy jobs at
the Hill, and cant afford babysitter for kids , situation is really difficult.
For black and Latinos there are many obstacles- race, background, language
barriers.. Once you are poor in DC, circle never ends. You find cheap housing
in one of the less safer, but cheaper parts of the city (South or East). To pay
housing, and afford food you need at least two jobs. If you are women , you are
less paid. If you are black , or Hispanic – you will suffer discrimination and
humiliation. If you have wife and children, she needs to work, just to afford
housing and basics needs. For people with minimum and average wage , there is a
new problem- children`s education. Since they cant afford super expensive and
elite private schools, they send their kids in public schools. Public shools,
who have the lowest literacy rate in the country. With teachers, who just care
to get through their day, and earn their salary. Schools in which childrens
talent and needs are neglected. Children are not motivated to study, or
overcome their language barrier. They have no option. So, drops out are really
common. And in the end, school gets closed. While researching this, I asked myself- if public schools get
money from property taxes (like Wilson high school in Tenley town) where does
that money goes to? Why it is not invested in education of poor kids. What can
happen next ? Parents lose jobs, especially if mother is missing for pregnancy
, illness of her own , or her kid (no paid maternity leave). Family sinks into
deeper debts, forced maybe to move out. That reflect on children to drop out of
school, go on streets, and start illegal business. Poverty line never ends.
For a
lot of people, that is the reality of “DC living”. Human index development is
high, but only white exclusive. Capital is developed only in downtown area.
Every else, poverty exists. Paradox of greatness and prosperity in DC, paid by
human suffering. Great history, glorious monuments to remind us of all
important steps of building America as a
nation. And behind all of that lies huge paradox of poverty, inequality,
discrimination. And circle goes on and on. Until America learns to be
Switzerland. Or change its policies, and realize society of perpetual growth is
a myth. Or a at least create another hero as Batman , or Henry Ford, and make a
new myth about prosperities and possibilities in this country. Because people
need to realize the real situation and do something to resolve poverty. Not live the myth.
