The rising tide of inequality will soon flood Australian political debate
It was always going to happen. Over the long term, no democracy -- let alone American democracy -- will stand for the destruction of the middle class and rapidly-rising wealth inequality.
That was the message not far below the surface in the US mid-term elections. And Wall Street and its investment banks need to take notice because they are the key targets of the rising star of American politics, Elizabeth Warren. It will not be long before she moves from Wall Street to globalisation. I first alerted Australia to “Warrenism” in the US (Politicians should heed the might of the ravaged middle class) last April.
Last night in the US political newsletter Real Clear Politics, Scott Conroy spruiked the Warren cause explaining why Warren should run for President.
For Warren, to win the presidency she first has to defeat Hillary Clinton for the democratic nomination. Although Warren has not yet announced that she will run, Clinton recognises the threat and has experimented with an anti-Wall Street stance herself.
The US exit polls showed very clearly that Americans do not trust their government to do 'the right thing'. Some two-thirds of voters say the country is on the wrong track, that they expect life will get worse for the next generation of Americans and that the economy favours the wealthy.
That's exactly what Warren, the 65-year-old Massachusetts Senator, has been preaching up and down the country.
Conroy says that no Democrat speaks as passionately and as effectively about issues related to income inequality, lack of functional governance and the declining American middle class as Warren does.
During the campaign, her 'fist-pumping, high-decibel, populist harangues' got crowds fired up wherever she went. Warren has the unquantifiable 'it' factor that modern politics requires of any serious presidential candidate.
No one knows this better than Clinton.
During Clinton's appearances on the 2014 campaign trail, Clinton attempted to co-opt some of Warren's 'defender of the little guy' identity, telling a crowd in Boston, “Don't let anybody tell you it's corporations and businesses that create jobs".
Conroy says it was a clear overreach, and the remark drew immediate ridicule in a variety of circles, as it was readily apparent that "Clinton lacked fluency in Warren-ese".
Analysis by Michael Snyder shows that six years ago, some 53 per cent of all Americans considered themselves to be ‘middle class'. Now it's only 44 per cent -- and falling (A grim prediction for the middle class, February 17). The middle-class hammering is most vicious for American youth because too few young people can get good-paying jobs.
The situation is worse in Europe. Australia held out against the trend for a long time but we are rapidly catching up as our large companies lift profits by outsourcing high paying jobs overseas or replacing them with new technology.
The first reaction of voters in countries that are affected by rising inequality is to change the government. In the US, they are discovering that conventional candidates are powerless to change the rising inequality tide.
But that simply inflames voter frustration as we've just seen in the results of the US mid-term elections. We are seeing the same forces emerge in Europe. Inevitably it will lead to more extreme candidates either from the right or the left.
If she stands, Elizabeth Warren will be totally different to any campaigner that we have seen in US politics for a generation or two.
In Australia neither Tony Abbott nor Bill Shorten appear to understand the significance of 'Warrenism'.
Actually, when Clinton said: “Don't let anybody tell you it's (big) corporations and businesses that create jobs,” she was totally correct -- it is small enterprises.
In Australia, Tony Abbott appeared to understand that what Clinton said was right when he embraced the unique pro-small business anti-inequality strategies of Small Business Minister Bruce Billson, who went into the inner cabinet.
But the 'Yes Minister' syndrome in Treasury and other places has meant that other issues have swamped Billson. That will change if unemployment and inequality keep rising.
If Clive Palmer ever wakes up to the fact that 'Warrenism' and 'defending the middle class' are the looming big issues in Australian politics, as in the US, then Abbott and Shorten better watch out.