Keeping the Poor Poor

The dirty little secret of capitalism is that the richer the rich get, the poorer everybody else has to get.

Erik Loomis at Lawyers, Guns and Money:

The state of Louisiana (and the voters themselves) have cut off funding for the last operating ferry in New Orleans. Big deal, right? Who takes the ferry anymore? The answer here is a lot of poor African-Americans coming to work in New Orleans from their homes on the west bank of the river. The ferry has about 1 million pedestrians and 175,000 cars on average. The drivers will be fine, but what about the walkers? How are they supposed to get to work? Part of this is a general American indifference or hostility to public transportation, but of course that feeling has its racial competent, whether it is Atlanta suburbs turning down MARTA service because it was afraid of black people coming into town or the reduction of public transportation services anywhere, since they disproportionately affect the poor and in the United States the poor are usually people of color.

As Charlie Pierce reminds us:

... income inequality is the only story worth following in the American economy. To hell with the Dow. To hell with the NASDAQ. To hell with the S&P index. And, as the blog's First Law Of Economics tells us -- Fk The Deficit. People Got No Jobs. People Got No Money. If, in our haste to declare ourselves recovered from the Great Swindle Of 2008, we accept the current level of unemployment, and a permanent level of income inequality that touches every aspect of our society, and not in a good way, then what we are doing is curing our head cold through decapitation. Civil government cannot endure with the level of income inequality that we seem willing to tolerate, or at least, that we seem willing to see as being inevitable. Civil government becomes a farce and, eventually, an unendurable one. And it starts, as everything usually does, in the schools.

Only well-regulated capitalism - the market economy we had from World War II until 1970 - expands the middle class while shrinking both the super-rich and the super-poor. Cancel the rules, and you get lords and serfs, with nothing in between.