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“There is nobody in this country who got rich on his own. Nobody. . . . You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate.”

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United We Stand, Divided We Fall

Elizabeth Warren, the consumer protection reformer and Harvard law professor who is now campaigning to represent Massachusetts in the U.S. Senate, has given one of the most direct and cogent explanations of the social contract we’ve ever heard. (It’s an idea that is not talked about often enough.) One way of describing the social contract, also known as the social compact, is of putting the Golden Rule into practice in society through the mechanisms of government for the benefit of all: Do unto others as you would have them do unto you. Share and share alike. It’s something children can understand, but not many bankers or senators.

Briefly, the idea of a social contract is of a mutually beneficial system that serves both the ordinary folk and the wealthy, and makes demands on all, a two-way street of reciprocal obligation and fulfillment. The closest the U.S. has ever come to enacting a social contract is through FDR’s New Deal and LBJ’s Great Society. It is an ideal, never quite reached completely, but its essentials were in place not so long ago and could be restored by determined, sustained effort. Robert Kuttner has written about how during the boom decades after World War II a “managed, rather than laissez-faire, brand of capitalism . . . delivered broadly shared prosperity, as well as greater security for both the system and individuals” (The Squandering of America [2007], p. 6). More from Kuttner below.

Let’s go straight to Dr. Warren herself.

I hear all this, you know, “Well, this is class warfare, this is whatever.”—No!

There is nobody in this country who got rich on his own. Nobody.

You built a factory out there—good for you! But I want to be clear.

You moved your goods to market on the roads the rest of us paid for.

You hired workers the rest of us paid to educate.

You were safe in your factory because of police forces and fire forces that the rest of us paid for.

You didn’t have to worry that marauding bands would come and seize everything at your factory, and hire someone to protect against this, because of the work the rest of us did.

Now look, you built a factory and it turned into something terrific, or a great idea—God bless. Keep a big hunk of it.

But part of the underlying social contract is you take a hunk of that and pay forward for the next kid who comes along.

Isn’t this more or less the idea behind “United we stand, divided we fall”?

As Steve Benen at Washington Monthly notes of Warren’s remarks, “First-time candidates don’t usually articulate a progressive economic message quite this well.”

We have written lately about how the Democrats seriously need to sharpen and toughen up their communication skills. We hereby nominate Elizabeth Warren as one of the chief instructors and exemplars at the Democrats’ School for the Mute. The school also needs a disciplinarian. The Democratic party cannot depend on the skills of Barack Obama alone—though he has lately been showing signs of improvement. Every senator, every representative who wears a D after his or her name should be in intensive training. Dr. Warren—whose talk about economic fairness prompted Jon Stewart to say, “I want to make out with you!”—is the Teacher of the Week. (Click here for her Huffington Post blog posts.)

 

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We were alerted to the good professor’s comments by Paul Krugman’s well-titled column “The Social Contract” (see below, after the jump, for a full version, highlighted and underlined as a convenience for our readers). After explaining why President Obama is right to assert that the wealthy should bear part of the burden of reducing the budget deficit, Krugman cites the “eloquent remarks” made this week by Elizabeth Warren, now on the campaign trail in Massachusetts, countering the assertion that the rich should get to keep all their wealth. It’s hardly “class warfare.” Summarizing Warren’s argument, Krugman writes:

“There is nobody in this country who got rich on his own. Nobody,” she declared, pointing out that the rich can only get rich thanks to the “social contract” that provides a decent, functioning society in which they can prosper.

This column follows several days after President Obama, in remarks in the Rose Garden (Sept. 19) on Economic Growth and Deficit Reduction, asserted with welcome clarity, “Either we ask the wealthiest Americans to pay their fair share in taxes, or we’re going to have to ask seniors to pay more for Medicare. We can’t afford to do both. . . . This is not class warfare. It’s math.”

Who You Callin’ “Class Warfare”?

American Prospect co-founder and co-editor Robert Kuttner (cited above), who once worked as an investigator on the Senate Committee on Banking, Housing, and Urban Affairs, writes in The Squandering of America that “the social compact of a bygone era is scorned by the Right as ‘tax-and-spend.’

Progressive taxation was once used by government to underwrite outlays that helped ordinary people. In its heyday, tax-and-spend worked, both economically and politically. People concluded that it was a good deal. Regulation was also part of the package, and it too protected citizens from the vicissitudes of rampant markets. (Squandering, 278)

The very same forces (so-called conservatives) that now decry as “class warfare” any shared responsibility for repairing the deficit are the same folks who largely built that deficit through massive tax cuts and shifted more of the tax burden onto the less fortunate.

To wreck a politics of progressive taxation and social investment, the Right changed the terms of who was taxed and what the taxation bought. The tax load was shifted off business and onto workers and citizens. The Right deliberately used tax cuts for rich allies to create permanent deficits, as a “starve the beast” strategy denying government resources and forcing cuts in programs that people value, such as Pell Grants. What could be clearer class warfare from the top? But pocketbook issues are so depoliticized that most ordinary people don’t grasp the connection, and too few Democrats help them connect the dots. (Squandering, 278)

Just several pages earlier in The Squandering of America, Kuttner points out that “when Democrats raised money from big business, there was an ideological disconnect. Economic populism was what had made Democrats the majority party. Yet wealthy donors, with a handful of exceptions, were paying Democrats to be less populist. They were rewarding the Democrats for deserting their natural constituency . . .” (275).

It is our argument, yesterday, today, and tomorrow, that the Democrats must be forcibly reminded (as with skillets over the head) that they and we prosper if they stand with populist fervor and gusto for the middle class and the less fortunate; they can never out-Republican the G.O.P. and shouldn’t even try. They have to trust the people, and represent the people, or we vote them out.

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See below for Krugman’s column, with colorful highlights and underlinings. Click on the image to get the online version.