Wall Street vs Main Street: A Picture of Dorian Gray

Some day the Tea Party will wake up and realize what’s actually killing "our country". It isn’t Democrats vs Republicans – though, it will be played out that way. The real dichotomy is Main Street vs Wall Street, or the real world vs monopoly money.

Daniel Becker from the Angry Bear blog uses an anecdote to paint the picture of the death of Main Street in much of a Dorian Gray scenario. From the outside it seems that our economy is doing great – and in reality it is in many aspects. The problem is that as our economy seems to be doing fine, never mind the recession which I’m not convinced is over yet despite official insistence it’s over, much of actual America is in decline. Mom and pop shops are closing because they cannot compete with more efficient big box stores and a greater concentration on the efficiency of finance.

It’s not just industrial New England that lost retail as represented in the loss of "Main Street USA", you know we are hearing of the destruction of the "heartland America" main street. I’m not talking about the loss of the cultural experience that "Main Street USA" represented, though there is that. We closed down for the sake of money efficiency, the other primary path to become middle class. In doing so, we also reduced the movement and thus booking of dollars within the local community. One dollar on Dexter Street, Central Falls, RI could potentially be booked in 31 businesses just by the owner of the business. Even if with that one dollar divided among the employees, that dollar still for the most part stayed in the community to be booked potentially 30 times. One dollar in Big Box Mall USA is divided up such that only a few cents per employee gets booked in the local community with the rest going up line to the few.

No, the trades related to construction can not make up for the loss of independent retail.  Retail was a major cylinder in the small business engine of our economy.  It was also a major path to political reality and activism.

I’ve seen towns decline first hand. Greensburg, Indiana is stagnant. It’s growing, sure, but the town itself is in decline. Its streets are breaking apart, homes have rotted, and the prettiest part of town is a new factory miles away from its epicenter. Despite that factory being a brand new Honda factory, wages have stayed the same because the other factories in town decided to force Honda to keep wages no higher than the median wage the factories pay to reduce poaching of employees. The towns people are no better off. If I didn’t think Greensburg, IN was a hell town, I’d sympathize more but I don’t. I do, however, sympathize with the poor fools worth a damn who are stuck in the town.

I’d be completely fine with efficiency of money leading to loss of Main Street businesses as long as there was strong wealth redistribution. However conservatives want it all: no redistribution, low taxes for wealthy who benefit from the death of Main Street’s demise, and low wages. You cannot have a democracy or a healthy economy when most of the wealth funnels into the few; that’s what’s happened and will continue to happen. Yes, we are much better off today than we were a decade ago. The Internet, for example, dumped more real, as opposed to paper money, wealth into the lap of every single person who pays for access – this wealth was in the form of communication potential beyond everyone’s wildest dreams two decades ago. Some would argue that it wouldn’t have been possible save for the rich investing in things. I would posit, in contrast, that the wealthy wouldn’t have that wealth to make it happen if it weren’t for the poor, middle-class, and the demand they produce. What level of demand can the poor and middle-class produce if the wealth sits in the hand of the mighty few?

Economists need to distinguish between real value and the contentment things such as Internet access, microwaves, cheap big screen television sets, bring with the potential to engage in financial commerce. It’s true, these things wouldn’t have been possible or accessible today without cheap labor in foreign countries and we should be thankful for that but can that always be the solution to moving forward? Can an economy build itself and everything it contains elsewhere while millions of people who want to work stay home not of their own choosing?

The exportation of jobs cannot be to blame for the stagnation of wages in the US. We can place some of the blame there but, in truth, it would be morally repugnant to say hundreds of millions of Chinese workers becoming more wealthy because of free trade shouldn’t have happened simply because we want to be selfish. At the same time, however, there’s a limit to how much wealth is ethically and morally owed to those who hold the reins of society.

Ezra Klein and this graph:

You occasionally hear people say that the average American’s consumption has continued growing over this period (though a lot of that was due to an unsustainable, and ultimately catastrophic, credit bubble), or that the way we measure inflation understates the improvement in the average American’s living standard. But none of that explains away this graph.


I like the idea of the television show Undercover Boss but I think it should go much further than it does. The wealthy in this country tend to be dismissive of just how bad it has gotten and can get for the average household. The Republican Party is a strong reflection of the wealth-controlling elite – the people who own, manage and control the most powerful businesses in the country. They are clueless. They see that America is in decline but fail to see exactly what is causing that decline. The Tea Party movement sees it but, they too, fail to see what is causing that decline. Regrettably, the Tea Party is sleeping with the wrong guy and the Mama Grizzlies out there are getting raped by a feeble old man with a billion dollar bank account. They’re not realizing that without the redistribution of wealth they so abhor, there is no middle-class. There are only two classes left: the wealthy and the poor. We’re not there yet but the data is proof we’re rotting away while, on the surface, we’re a beautiful country.

To be more clear, the point is that it’s fine that Main Street is in decline as long as there is a method of wealth redistribution. If the mass population has no means to create demand, the entire country will decline no matter how much we try to stop it. Conservatives working against wealth redistribution by lowering taxes for the wealthy and fighting direct subsidies to fight poverty are making things worse.


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