Global Policy Forum

Invisible Neighborhoods, Irrelevant People
from Chicago to Baghdad

By Paul Street

A Selective Audience

According to the White House, George W. Bush flew to Chicago last week to sell an "economic stimulus plan" to the people of the "American heartland." As always with the current administration, reality is rather different than the official word. Truth is, Bush flew over most of Chicago to the ritzy Sheraton Chicago Hotel & Towers in the city's affluent North Loop to sell a tax cut for the wealthy to rich people in the Economic Club of Chicago. His speech was received by what the Chicago Sun Times called "a crowd of cheering businessmen."

The Economic Club, whose terse web site pronounces "MEMBERS ONLY," is "not," that site's content providers explain, "a club of, or for, economists or economics majors." It is, rather, "about leadership …the ‘Who's Who and Who's to Be' of Chicago's business and professional life." It has worked "for over 70 years" to "foster the development of civic-minded executives who embrace their broader role in helping build a better, more productive society." Members "must be sponsored and approved by a committee of their peers."

Translation: The Economic Club of Chicago is a metropolitan civic agency of, for and by the corporate-connected super-rich and selected public, civic and professional servants loyal to the corporate plutocracy that owns America's "democracy." It works for social and policy developments that preserve and expand the special wealth and privilege of leading segments of the business class.

"We're All In This Together" and "I Don't Think It Was Rich Versus Poor."

Insisting that "we're all in this together" (United We Stand), Bush accused those who claim his plan is overly friendly to the rich of engaging in "class warfare." He received support in this regard from Chicago Mayor and Economic Club member Richard M. Daley. According to Daley, who rode with Bush in the presidential helicopter from O'Hare to the Loop, Dubya's speech was a winner. "I believe he hit a home run," the Mayor told reporters, "in that he talked to Middle America. It don't think it was good versus evil, ‘rich versus poor.'"

But of course, "class warfare" – of the unmentionable top-down variety – is exactly what "it" is and always has been about with Bush. Bush's plan contains some proportionately small measures for poor and ordinary working people. It increases the child-tax credit, provides some small assistance to the states and creates small unemployment accounts to help jobless workers whose unemployment benefits have run out.

Still, consistent with his hosts' "members only" mission, the cornerstone of Bush's package is the elimination of taxes on American corporate dividends – a measure that "could cost the government $300 billion over 10 years" and will "create much bigger budget deficits for the future," according to the New York Times. "More than half the benefit of eliminating dividend taxes," the Times reported, "would flow to the wealthiest 5 percent of taxpayers." That may understate the proposal's regressive impact, since just 1 percent of investors receives more than 40 percent of stock-market income and the top 10 percent receives nearly 90 percent.

According to the Urban-Brookings Tax Center, thankfully created "to clarify and analyze the nation's tax policy choices" (http://www.taxpolicycenter.org), the liquidation of dividend taxes translates into an extra $45,000 for people making more than $1 million and $6 for people earning less than $10,000.

Bush also called for the acceleration of pre-existing income tax cuts and the repeal of the estate tax, which affects only a tiny and super-privileged segment of the population.

Just don't call it "class warfare" or "rich versus poor."

Inverted Gramscianism

Chicago Tribune reporter Bob Kemper, no Marxist class warrior, provided a serviceable framework for understanding the real purpose and nature of Bush's visit to Chicago. He noted that the Economic Club gave Bush a "high-profile and sympathetic forum" to "symbolically wrap a controversial plan that directs most of its money to the wealthy in the conservative, common-sense values of the American heartland." This analysis reminded me of 20th Century Italian Marxist Antonio Gramsci's notion of ruling-class cultural "hegemony" as the incorporation of social and political arrangements serving the interests of the privileged few into the "common-sense" world view of ordinary folk.

Consistent with its inverted Gramscian project, the White House has been framing its proposed dividend tax cut as directly beneficial to the broad stock-owning middle-class. This spin deletes the fact that a small percentage of the population still owns most of the nation's corporate stock, however commonplace it has become for Americans to own some stock. It is also merits mention that ordinary middle-class 401(K) accounts are already tax-sheltered until their owners withdraw their money, which then gets taxed as regular income.

Stimulus As Pretense for Regressive Tax Policy

New York Times columnist Paul Krugman also put the plan in useful context. The president, he argued, was trying to "use the pretense of stimulus mainly as an opportunity to get more tax cuts for the rich" – an evaluation shared by "most economists" according to the Tribune. Even economic "conservatives" – translation: those who support the radical upward distribution of wealth and power – doubt the plan will offer any real systemic stimulus anytime soon. The Tribune quoted economist Kevin Hassett, of the "conservative" American Enterprise Institute, who acknowledged that "it's a tax reform [one that Hassett supports], rather than an economic stimulus…That's how to think about it."

A tax reform for the super-rich, it is worth noting, on top of a previous massive Bush tax reform for the super-rich. Just two years ago Bush asked for and received from Congress a mammoth ongoing income tax cut that directed 70 percent of its benefits to the top 5 percent of taxpayers in what was already by far the industrialized world's most wealth-top-heavy nation. This gift to the privileged few, too, was sold as essential for economic growth and jobs, but the results so far have been less than encouraging – 2 million more jobless Americans and 4 million more without health insurance.

Its' a tax reform for the rich, also worth noting, in a time of massively escalating imperial ("defense") expenditures. The price tag for the White House's obsessive, unnecessary Iraq campaign, which includes a possible 18-month occupation to install "democracy" (or whatever), runs well into the hundreds of billions.

Right out of the Reagan play book, it's a deliberate combination – regressive tax cuts and massive Pentagon extravagance – guaranteed to further eviscerate the federal budget surplus Bush inherited, undercutting social programs and leaving an intolerable debt for generations to come.

Sheer Class (and Race and Gender) Venom

Adding insult to injury, Bush yesterday urged the Congress to tighten the nation's "welfare-to-work" requirements. Recycling old Reagan-Clinton rhetoric about "getting [poor] people to work" (for someone else at low wages and without union protection, health care and other benefits) and making them "less dependent on government [the wealthy are exempted from that stricture]," Bush wants to increase the (paid) work requirements for the single-mother heads of highly disadvantaged public cash assistance households from 30 to 40 hours a week. Current law under the harsh Clinton-Gingrich welfare bill of 1996, passed in the middle of a booming economy, is already the toughest in the industrial world. Meanwhile, the unemployment rate (considerably lower than real unemployment) has risen from less than 4 to more than 6 percent during the last two years. That rate is much higher in the unskilled labor market inhabited by most welfare recipients and is higher still in the neighborhoods housing the highest concentrations of the remaining public assistance caseload.

It takes no small measure of sheer top-down class (and related racial and gender) antipathy to call for a tightening of the "work" requirements on welfare mothers in a time of rising joblessness. To do this while pushing massive tax cuts that will slash funds for child-care, job-training and other services needed to move from welfare to "work" requires a transparent class arrogance that is beginning to seep through the protective corporate media filters, as with the more obviously aristocratic Bush I.

City of Neighborhoods

Chicago's boosters speak of it as "a city of neighborhoods." In a spirit of democracy befitting a "benevolent" empire preparing to export freedom and liberty to the Arab world, then, the President and the Mayor might have made a neighborhood detour on their to the Economic Club. They could have visited forgotten neighborhoods like North Lawndale, Garfield Park, Englewood, Oakland and Grand Boulevard to view some of the "collateral damage" produced by an elite class and related race war that has been waged with little publicity for the last three decades.

In Chicago's ten poorest neighborhoods, all located on the predominantly black South and West Sides and collectively containing 212,000 people, there was a distinct shortage of social and economic Homeland Security well before 9-11. Forty-five percent of those people lived in poverty at the time of the 2000 census. Median income was $17,320 and the youth mortality rate was 76 per 100,000.

In the city's ten poorest zip codes in 2000, also all on the South or West Sides, moreover, more than a fifth of the civilian workforce was unemployed (not counting their large number of incarcerated) and the child poverty rate was 47 percent.

These numbers come from the peak of the Clinton economic boom; things are worse in these communities now, thanks to the recent acceleration of paid work's long and ongoing flight disappearance from the inner city.

Things were very different at millennium's turn in the ten most affluent Chicago neighborhoods, disproportionately located on the more Caucasian North Side. In those select communities, just 4.6 of the people lived in poverty, median income was $60,187 and youth mortality was 1 per 100,000.

But, of course, many Economic Club members probably do not reside in Chicago at all. They likely inhabit super-affluent Chicago suburbs like Lake Forest (median household income of $136, 462), Winnetka ($167,458) and Kenilworth (more than $200,000), where well-kept avenues are dotted with palatial mansions, stock equity flows freely, and marvelously entitled children attend the state's finest and most well funded schools.

Since they generally own no stock, people in Chicago's bottom-end neighborhoods do not lose much sleep over the "double taxation" of corporate dividends denounced in outraged terms by the Bush, forgetting that wages are levied at least twice by government in the form of payroll and sales taxes. Many in the city's poorest communities have never been employed long enough to receive unemployment to become eligible for Bush's proposed small ($3,000) "jobless accounts." Many would be happy if they could just get felony drug convictions expunged from their records, like the President is said to have done, so they could be in the running to get a job to lose.

Priorities and Response

What do the Bush administration's actions, very different than its language of "togetherness," say to the residents of the nation's poor communities? Essentially, that:

They simply don't work hard enough and their needs do not (cash) register when compared to those of strategically placed businessmen whose "success" the government must "reward" (and create) with wealth-fare for those who now how to put inherited fortunes and other people's money and labor to work for them.

Solving their problems is not a public priority relative to fantastically expensive overseas projects to serve wealth and better supervise a global system that drains the lifeblood out of their communities. World history's wealthiest nation can't afford to provide them with adequate job training, child care, health care, environmental protection, drug treatment and recreation but can afford $200 billion or more for attacking and then "reconstructing" (or whatever) Iraq. Taxpayer money that might be spent to educate their children, keeping them perhaps out of the nation's burgeoning and expensive hyper-incarceration system, is earmarked for darker global purposes.

They are, in short, barely more visible than the people of Iraq and the neighborhoods of Baghdad, whose real situation and likely wartime fate is banned by Bush doctrine from the bizarrely obsessive White House campaign against Saddam – as if the world history's most powerful 's military machine could launch a massive assault on just one man (see note).*

To identify and denounce these and other stunning American disparities is to prove yet further one's undeserving nature, marking one as an unpatriotic proponent of class warfare – the wrong kind and the only one that can be named.

Criticisms of Bush policy at home and abroad are useful only in the context of resistance and the development of meaningful alternatives. Without the latter, criticism tends to reinforce the widespread fatalism, apathy, despair, and exhaustion (widespread in the nation with the industrialized world's longest working hours) upon which the ruling class relies heavily. A more fully responsible and appropriate response goes from understanding to changing the dark historical moment. Bush and his horrid collection of corporate-plutocratic and arch-imperialist fundamentalists must be compelled to stand down from their excessive, inseparably linked pursuits of empire abroad and inequality at home.

Major demonstrations against the currently planned war on Iraq and the related domestic assault are being held in the nation's capital and at other sites throughout the US this Saturday. Let the battle begin and remember – if it feels like class warfare and if it talks and walks like class warfare, well, then, maybe that's just exactly what it is.

Paul Street ( This e-mail address is being protected from spambots. You need JavaScript enabled to view it ) writes and lives in Chicago, Illinois.

* A recent issue of the Red Eye, the Chicago Tribune's silly effort to compete with "alternative" Chicago weekly papers like The Reader and New City, presented a picture of Hussein alongside the question "Nuke Him?" Readers were left to wonder how America might launch an atomic war directed at one man, even less plausible than Bush's claim last October that Iraq is a threat to attack United States territory with unmanned airplanes fitted to distribute chemical and biological weapons.

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