"Visions of World Benefit & Global Responsibility: Perspectives of McGill Students

Monday, July 30, 2007


« A Thinning Line»

The structure of societies has been rapidly shifting since the beginning of the 20th century. Emergence of economic powers namely China, India and Asian Peninsular (for example Japan and Hong Kong) and drastic changes into structured organisation at the work place have equally impacted with technological advancements. Who is negatively affected by all this change? The middle class, now more than ever, suffers the burden of automation at the workplace as well the migration of overseas of corporations attracted by cheap labour. The “War on the Middle Class” is a reality that leftist and rightist politicians have to face in the United States and other democracies.

In the past, a hierarchical social class was set to define and divide groups of persons according to income earned, profession and even education. Most were categorized in classes such as upper class, middle class, working class and lower class. In the 1950’s, the United-States middle class formed approximately 50% of its populations. Moreover, since the 1970’s there has been evidence of a steady yet slow decline of this class. However, with the ever increasing demand and push of technology, the middle class has been shrinking at an even fast pace since the 1990’s. This trend can be explained by the occupational restructuring and earning by occupation.

Baby boomers have piously trusted in a future rosier than the present, millions of households are borrowing so much money that they end up endangering the very future they hoped to build for themselves. The lower and middle classes have practically given up on putting aside any savings. Fixed costs have risen correspondingly with the increase in household incomes. This means two-income families are no longer able to cope. Besides, the current trend is mostly shifting into a consumer society rather than a productive society. They are going into the 21st century like a poverty-stricken, Third World family, living from hand to mouth without any financial reserves.

Globalization is striking back. The United States including the G7 countries have promoted worldwide exchange of commodities like no other nation, and the result is that their local industry has started to erode. Some production sectors, such as the furniture industry, garment industry, consumer electronics, many automobile spare part suppliers, and now computer manufacturers, have left the country for good and finding cheap labour access in other countries. The Ultra-wealthy have always been around and have expanded wildly over the past 20 years, thanks to a combination of 3 elements: a) a technological meritocracy; b) a readily available method of cashing out the benefits of that meritocracy via options and the stock market and finally c) a significant drop in the highest tax brackets. The 'ultra-wealthy', meanwhile, are able to take advantage of two trends: the genuine expansion of opportunity brought about by expanding productivity and more free markets and the intentionally inflationary policies of government and the Federal Reserve, which deliberately remove purchasing power from the middle class and transfer gains to the ultra-wealthy in the form of leveraged profits on paper assets.

Education has become so expensive that many students graduate with huge debt loads; this has profound implications for the future of the middle class. Therefore, new organisations must be provided in order to counter the thinning middle class otherwise, many people eager for a higher education will not have the opportunity to do so.

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