this is becoming increasingly.

please. continue. to. blow and welcome the ground stop and people of all the trials and tribulations of the middle class long considered the pillar of the west political and economic border it is now the victim of a long term downward mobility why is this the case our government policy is to blame or is this due to what is called the politics of dependency. and. cross talk to decline of the

middle class i'm joined by louis shoval in new york he is a sociologist professor at and invited professor at columbia university in chicago we have david psychotic he is a professor of philosophy at loyola university chicago and in los angeles we go to tony katz he's a tea party organizer and a radio talk show host all right gentlemen cross talk rose and if i mean you can jump in anytime you want and i very much encourage it tony in los angeles you got up early as for this program so i'm going to go to you first why why has the middle class been suffering so much over the decades is it government policies that have done this to the middle class or is the middle class itself it's changed its values its structure and this is just the way of capitalism it's just a way it works that's there's been a myth about the middle class for a century and it's just something that's changing. first of all it's good to be here and let's not engage

a conversation where we're blaming capitalism capitalism is not the problem capitalism is what allows people to thrive and survive and grow and allows for opportunities i'm never going to allow anybody here anywhere else to have an attack on the open markets and free markets that just that's just for hardy nonsense but i think there are interesting conversations as to what are the forces at play and that are making making a living difficult right now how do you change those forces those are conversations about taxation those are conversations about what it is that a society needs to offer what it is that government is supposed to do for us as opposed to do to us those are the real conversations i don't even think that they're political i don't even think they're right left or or or anything like that they're about what are the constraints of government what are good tax policies government policies that allow people to thrive and survive i think that once you can gauge those conversations a big deal when you know what is going to be living nonetheless i think we would all agree on this program in our view my viewers too is the middle class has taken

a real clobbering over the last thirty years and particularly since the advent of the financial crisis in two thousand a david if i can go to you the fate of the middle class i mean it just gets worse and worse and worse and i will part company with tony i think it has something to do with capitalism i think it is an important conversation david go ahead and chicago. well i mean i certainly think so too but yes the middle class has really taken a hit as joseph stiglitz nobel laureate in economics remarked a few months ago we can no longer pretend it isn't true the upper one percent now owns forty percent of all the wealth now it takes home twenty five percent of all the income the average income the median income in the united states household income is fifty thousand dollars right. there four hundred billionaires in the united states if you get a five percent return on your on your billion you know you get fifty million a year doing nothing. you know a million times more thousand has more. but the root cause of this i think really

does go back it's not something that's just come about because of the financial crisis it really goes back to the mid seventy's a striking thing when you look at the data is that household incomes have been rising steadily through till about one nine hundred seventy five and they have flat lined since for the middle class this would seem to create a problem because if people aren't making more money you know yet more and more stuff is being produced how come the economy hasn't been in crisis since then and i think we know the answer the answer is people have been borrowing the money in effect the wealthy capital is classes instead of raising wages regularly let's so you can buy our products will loan you the money so you've got this massive debt that finally exploded finally gave us the melt down but even then what i think the root cause goes back to something earlier than that the new technologies that were

coming online that made it possible to offshore production to set up factories abroad so that you do get around the globe global wage competition which is interesting is david it's interesting i mean with the things that tony said and what you've just said and i'd like to go to green right now in new york it should we even speak in terms of in terms of the middle class anymore i mean because of the technological changes and because of the way the economy is involved in this the financial ization of the economy is a very good point to the credit. crunch that that was just mentioned here i mean it has the middle we should we keep using this term should we be using a different term because middle these people are not in the middle anymore they're in the single digits at one end. yes in the middle of literature you. go into your list their head we're going to do your first yes yes interaction it's

very clear that fifty fifty years ago the western countries where civilization of middle class middle class neuroses technicians and engineers and the sky and of of associate proficient all's well as a center also says we does ation of western countries in europe in the us to. know is that we have a shrinking middle class and the kind of explosion of middle class in two parts a well meter closet is sinking and on the middle class of professionals increasing in incomes in impact in political command of society and we all know we are no more able to to to to to to create new dynamics of either class the problem is not simply technology it's a problem is that investment technology called these investments new businesses and new will be arsed from is more and more in china in india in buzz euna and inertia

are this in less in the western countries and zoo loo where we don't class the western countries are completely since king they are first hated they face political problems and difficulties and seats we are a problem for they were crises in most western and i want to hear what i want to do with them which for us i mean ends in the second half of the problem david you look a little perplexed if you want to jump in there yeah well there's two things first of all the middle class is dissolved in but it's not that fifty percent are going down and fifty percent are going up no it's about eighty to ninety percent you know are seeing their incomes stagnate or go down in the upper twenty ten and above all the upper one or two percent you know are doing well but the other thing there is this political dimension of the. it's not just technology there was also the polish move to advocate to push for free trade to dismantle any kind of protectionism

so that our workers had to compete with workers everywhere else in the world this was a political decision that was unable to buy the new technologies that now made it profitable for companies here to do all this outsourcing of moving their factories and so on ok tony if i go to you the most important and greatest export of united states is jobs apparently and that's destroying the middle class whose fault is that ok is it just technology you know you know snooze you lose or is it on more people with capital saying it sees will can make easier money in the bric countries for example is it a political decision. again we will not be attacking capitalism or the open market around but if we can being gauge on the side that if you intended ology god god god forbid we should have the automobile we could just go back to the horse and buggy wouldn't we be all better off it's like dan rather saying that there should be protections in the us house of representatives amongst the federal government i

should say for newspapers because newspapers somehow need our protection technology is a good thing advances are a good thing sometimes things fall by the wayside newsstand's you are tony is just a middle class family on not just the middle class even if for a moment because rich people benefit from these you know they do but just the middle class the conversation about jobs in america for example isn't so much a conversation about technology take a look at fracking technology take a look at what we can do to get the natural gas right from underneath our feet but we don't seem to do it it's a conversation about regulation in america that keeps things from growing and thriving and prospering so there's a we're going to talk about. the benefit of all of us if we don't take it david jump in your hands on the technology go ahead david yeah i mean tony mentioned the automobile now that was an interesting technology but what was peculiar about the automobile technology is that it was a technology that generated far more jobs than it replaced ok yes the horse and

buggy industry took a hit but you got automobile factories you got gas stations you got auto parts the new technologies that was an historical accident the new technologies may be wonderful but they do not magically generate anything like the number of jobs that they are every placed in in fact the newest technologies the big ten times the. hospital dish offshore sure those jobs ok let me i don't really know what i am and i new york i want to go back to new york chance please you know whenever we have an affair time here we do you see do you see. what we call the middle class in the west recovering i mean what's going to take for the west for the middle class to regain what it's lost over the last three or four decades. in trying to he gains indeed status first through question is. of work it's a problem in many countries notably in though your poor western europe and countries of two strong welfare states is that so work of work is disappearing but

it's not simply that it's also investment in new businesses investment in and here universities and formations the development of a new intermediate professional class such as does it is that has been disappearing over the last thirty years so the problem is that thirty fifty years ago all associate professionals proficient way or kind of in the color of the west of western countries the problem now is we have more of them are kind of not could only but to so on contrary is in front of the economic poor technological poor and poor of china and of is to an asia our problems is that we are forgotten that is an investment and the problem with investment is that it's not simply capitalism or big governments that are able to to to to do everything so

polemic over the last thirty years is that both the big governments and both capitalism have forgotten a lot of science and technologies that we need in order to he create a middle class if it is ation such as these are brought in quite a know all right interesting point gentlemen we're going to go to a short break and after that our break we'll continue our discussion and downward mobility of the middle class stay with r.t. . if you want to. everyone wants to be pretty. whether they're an old lady engine driver.

but it might be quite tricky to get a fancy cut. because you live out here in siberia. and the only way to get to you is by train. wealthy british scientists are. time to. market why not. come to. find out what's really happening to the global economy with mike's cars or for a no holds barred look at the global financial headlines tune into kinds a report. and you can.

start. and. welcome back to cross talk about people about to remind you we're talking about the prospects of the middle class. and if you say. ok david i'd like to go to you in chicago i mean we mentioned before we went to the break what he didn't say exactly but he was talking about what people say the politics of dependency and how the state has made the middle class dependent and because of the the rise and maybe we see it we're seeing the fall of the welfare state do you think that's a mitigating factor in the fate of the middle class because. no i mean i think we had to go ahead and think so go ahead that that makes that make it makes no sense in the i don't see how anyone can blame the fact that there's people on welfare that's not what is responsible for the fact that we're the jobs are the number of

jobs are less and less available more and more people are losing their jobs it has nothing to do with the cultural defense dependency it has everything to do with the fact that the invisible hand of the market given a free rein will not create enough jobs in a very curious way marx is coming back marx remember predicted that when wages go up the capitalist will replace skilled workers by machines this will generate unemployment ok mark so you can reserve army and. police downward pressure . and he gets worse and worse a fuse with a fuse went off and. sure there is your head let's make sure let's make sure that we're all all talking about a couple things karl marx was a first rate hack communism sucks so let's never engage the idea that karl marx is someone we should look up to second of all it is

a thrill to hear people say and recognize that the eight point three percent unemployment numbers in america are false because when you don't include one point two million people on the rolls you can say that the number has gone down number three it is capitalism the open market that creates jobs and opportunities allows people to grow thrive and survive you can't say and you can't sit there and pretend that you're in any way have any intellect whatsoever and say that dependency doesn't put downward pressure and doesn't hurt people from rising up if you create an opportunity for people to get something for nothing and you put them in a place to desire the something for nothing they will never try and build up to say otherwise if you think that if you go on welfare you're just going to just. david go ahead i don't think you'll say sure there's only one david i don't know i just tore up their welfare checks and went to work the jobs would be there right right. yes i'm feeling not what i said what i said david you got to actually pay attention to the words that come out of the mouth what i said is that when you think about

the idea that dependency class as if it's mythology that's not true that is an accurate when you have more people than ever than ever on food stamps one has to ask the question why some of the question has to deal with the economy some of it has to deal with the ease of being able to do that as opposed to other things so you have to take a look at it in its totality not in the political landscape you desire it but quoting karl marx as a guy who understood and that is how little know there aren't jobs for those people their jobs are there for those people that's the obvious if all those welfare people went out to get a job is it there no you david gentlemen i want to go to new york david dreier janice we have free time you want to say oh no sir no no no telling when you claim i have to go to new york ok louis i think it's one of the interesting things that's happened right now is that and i would tend to agree with you and particularly in looking at europe and in the construction of the welfare state which was very

popular with people in europe after the war but as the financial ization of the economy occurred you have this double whammy where the state can or cannot produce protect these people anymore and you see slashes in budgets and all that austerity doesn't create jobs at all that's a double whammy and that's another reason why the middle class at least in europe is being crushed and there's very little prospect of seeing them coming back. in fact a. note on a do not g.'s turned on extremist case of welfare state is that it's not good it's not intrinsically good or bad the problem is in many western countries the heights and always that we are who bad with your state so it is not investing in should share in some novelty cure and countries such as sweden you have a good way for a state that is investing in the future of children giving giving saying what all the genes a bitter education in in italy in their literature. in technologies in math and

in fact a good way for state is a way for theta which is interesting to well future up in many western countries is that we are of welfare states of. fat cats we took which are not investing in the future of our children in order to to to have a better situation and to heed use of frustrations of the middle class we have to invest that have been education and not simply need to cation mitch mars and we do ok again it's very interesting here because we actually look at who was going to house we had so little has done i mean our children we have to look who has the money and the fact cats as you say or in states and states seem to have not the money right now tony if i go back to you does it bother you does it bother you that the the very rich in the united states particularly have recovered completely from the crisis of two thousand and eight they're getting their bonuses their dividends vary and the economy is actually growing but the middle class is still being

pulverized i mean how do you feel about that because you know if you're really well off in the top one percent well you don't really worry about much of anything because you just outsource everything abroad. well i i don't accept the premise of your question and in the slightest i think that one of the greatnesses of the open markets is the opportunity to thrive and survive in my point to david earlier was that this idea that the job has to be handed to somebody whatever happened to the creation of the job what happened to the small business owner engaging a small business this goes back to the conversation about regulation which is a good conversation about how you grow an economy and make let's make it easier for people to open the business less paperwork more interaction with customers and that's a far better opportunity and let's not talk about the rising the wage just being stolen by a by the by the the owners that's not true rising wages help people all the way around though the those companies and corporations. and save it are the

people who create opportunity ok david go ahead because i haven't heard of an increase in wages for a long time with these are rising the part of the problem with the with the small business is it's part of the problem there's it's not regulation that's the you know yeah there's some regulation and so the problem is the customers aren't there people don't have the money now they've got so far in debt they're trying to get out of debt when people aren't buying small businesses suffer small businesses take the hit before the large businesses do so you've also got this peculiar perverse kind of new monopoly where the big companies the wal marts and so on are our cost cutting cost keeping prices down which is what people want but that means they keep pressure on their suppliers so that those wages stay down so that you've got this big problem when wages are down all over and the more unemployment the more downward pressure there is who's going to buy the stuff businesses private sector

won't invest because they don't see the customers there it's going to take the business private businesses will create jobs if demand is there if the. mandas there they won't create jobs they'll speculate they'll put their money somewhere else it doesn't make sense for them to invest in the real economy it doesn't make sense in them to invest long term this is why you've got such gridlock in the political system frankly i don't think the conservatives or the liberals know what to do they don't have any solutions so let the wealthy do what they can and make as much as they can you know before i don't know before i don't know what's going to happen but it's not going to be good if i go to you i mean and i'd like a focus a little bit about the political implications of this is david was saying here i mean if we look in the united states we see not only gridlock but we see fragmentation here and we don't see really strong allegiances anymore that we would think we're middle class because we can have the occupy wall street movement we can have the tea party simultaneously ok and that's

a reflection of the inability of the republicans and the democrats to get out of this economic mess and i would throw in cultural wars that are absolutely useless for the united states and not so much for western europe i mean how is this happening here because again we look at middle classes of having certain political identity that's changing as well and it may not be good it may be good i don't know yet in fact in many many countries of the west you are increasing frustrations of the middle classes over the last twenty years and both heights wing and the left wing solutions fade in front of economy clearly to see an endo fairly t. overthinking and sinking in a well neither class so their problem hi to know is that you of extreme frustrations are the development of strong produced movements over and you hope and maybe or so in the united states n.z. is frustration increasing sue vicious cycle of political and they couldn't make

problems so high trying and are left. these are your two talking create a middle class and these international competition you we have quite an hour or so of political systems of the west all week in the week and i guess that in the end that's why it looks like you go back and that's probably if i go to tony on this because the middle class in the united states has been crushed for thirty years it is damaging the democracy in the united states because people are not seeing that there the the political process can address their needs because far away from the united states most people look at the republicans and democrats and say what in the world is the difference between the two the do what's the difference between mitt romney and barack obama i mean standing at a distance there is no difference. yeah but that's another conversation ok today right now there is a ground problem there's road i'm ok. i'm going to flee out for that but your

conversation is really about is government the ones to make this decision and are those those the ones we're supposed to depend on if you create the situation where people are depending on government to solve their problems they will of course be dissatisfied because they can't work it could never ever happen government can't solve your problem what government could do is create more problems for you and that's what we're seeing that's why these elections coming up the twenty twelve elections presidential election senate elections are so incredibly important because it's a conversation of dependence on horse versus independence does government to do for you or are you to do for you that is by the way the entire tea party faces you do for you you enable your life government does get control again to me and say we don't want to. run out of time here many thanks to my guest today in new york chicago and in los angeles and thanks to our viewers for watching us here arky see you next time and remember cross talk to.

you. if you. could take three. three. three. three. three. three blog video for your media project c.e.o. don carty dot com.

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