What we are witnessing are the workings of an “apparatus of justification” to rationalize the “extreme economic inequality” that is on the horizon and that hedge-fund managers’ compensation signifies.
In her New York Times report on the astronomical compensation hedge-fund managers earned for their job performance last year (“For Top 25 Hedge Fund Managers, a Difficult 2014 Still Paid Well”), Alexandra Stevenson writes,
“For the average person, these sums are extraordinary. But the overall pay for top earners was down by hundreds of millions of dollars in 2014. These managers made just over half of the $21.15 billion earned by the top 25 in 2013.
“Still, what makes such nine- and 10-figure paychecks remarkable for 2014 is that many of the top earners had mediocre performances at best.”
The managers “made
just over half of the $21.15 billion earned by the top 25 in 2013”?
What makes managers’ astronomical paychecks “remarkable” is that they “had mediocre performances at best”?
Let’s be clear: the fact that these managers earned just over half of what "the top 25" earned in 2013 should not – should absolutely not – give “the average person” pause (“But the overall pay…”). That is, this drop in earnings should not make he or she think that $11.6 billion in compensation isn't so extraordinary after all.
And by the way, hedge-fund managers' unimaginably large paychecks were remarkable whether or not their performances were mediocre “at best.”
Take note of Stevenson’s dance here, for what we are witnessing are the workings of an “apparatus of justification” that economist Thomas Piketty says will need to be in place – together with an “apparatus of repression” – in order for the United States to reach and sustain the kind of “extreme economic inequality” that is on the horizon and that these managers’ compensation signifies.
As I wrote in “Who’s policing the one percent while our cities burn?” Piketty argues that given the current expansion of economic inequality in this country (“inequality of income from labor – and to a lesser extent inequality of ownership of capital”), by the year 2030 the “top decile” might very well “claim about 60 percent of national income, while the bottom half would get barely 15 percent.” Because such inequality is likely to cause unrest, it will become increasingly necessary for that top decile to have in place an effective “apparatus of justification” that will rationalize its 60 percent take and thus placate the “average person” who will have to make do with that measly 15 percent of national income.
How apropos that Stevenson’s spin on the top decile should come at a moment when our phone cameras are exposing and laying bear to us the workings of a “repressive apparatus” (police brutality, militarism, and repression), the violence of which is causing tremendous suffering for those on the very bottom of the bottom half! What a teaching moment!
And so I’ll ask the question again: who’s policing the top decile while our cities burn?