Publication

Land of the Fee: Hidden Costs and the Decline of the American Middle Class

Politicians, economists, and the media have put forth no shortage of explanations for the mounting problem of wealth inequality—a loss of working class jobs, a rise in finance-driven speculative capitalism, and a surge of tax policy decisions that benefit the ultra-rich, among others. While these arguments focus on the macro problems that contribute to growing inequality, they overlook one innocuous but substantial contributor to the widening divide: the explosion of fees accompanying virtually every transaction that people make.

As Devin Fergus shows in Land of the Fee, these perfectly legal fees are buried deep within the verbose agreements between vendors and consumers—agreements that few people fully read or comprehend. The end effect, Fergus argues, is a massive transfer of wealth from the many to the few: large banking corporations, airlines, corporate hotel chains, and other entities of vast wealth. Fergus traces the fee system from its origins in the deregulatory wave of the late 1970s to the present, placing the development within the larger context of escalating income inequality. He organizes the book around four of the basics of existence: housing, work, transportation, and schooling. In each category, industry lobbyists successfully influenced legislatures into transforming the law until surreptitious fees became the norm.

The average consumer is now subject to a dizzying array of charges in areas like mortgage contracts, banking transactions, auto insurance rates, college payments, and payday loans. The fees that accompany these transactions are not subject to usury laws and have effectively redistributed wealth from the lower and middle classes to ultra-wealthy corporations and the individuals at their pinnacles. By exposing this predatory and nearly invisible system of fees, Land of the Fee will reshape our understanding of wealth inequality in America.


Devin Fergus
Published:

Oxford University Press, August 2018

Author:

Devin Fergus is the Arvarh E. Strickland Distinguished Professor of History and Black Studies at University of Missouri. His research focuses on political economy, policy, and inequality in modern America. Professor Fergus is the author of Land of the Fee (Oxford, 2018), which explores the hidden costs of rising financial fees at home, school, work, and transportation on wealth and mobility in modern America. A much-anticipated work, Land of the Fee has been called one of the five best books for understanding capitalism today. His current research project examines white-collar crime and the racial wealth gap.

Fergus is guest editor of the special issue Banking without Borders: Culture and Credit in the New Financial World for Kalfou, a journal published by Temple University Press. This special issue examines the impact of four decades of financial deregulation in the U.S. on vulnerable populations, which has increasingly affected the middle class. He has written widely on policy, political economy, and inequality for the New York TimesWashington Post, and the Guardian. Along with Louis Hyman, Bethany Moreton, and Julia Ott, Professor Fergus is also editor of the Columbia Studies in the History of U.S. Capitalism book series published by Columbia University Press.

Professor Fergus has worked closely with several national policy organizations (e.g., Demos, Closing the Racial Wealth Gap Initiative, the Center for Global Policy Solutions, and Prosperity Now) and has presented research to a number of federal entities, including the U.S. Treasury, U.S. Department of Education, the Consumer Financial Protection Bureau, and the Special Master (Kenneth Feinberg) for TARP Executive Compensation. Professor Fergus received his Ph.D. in American history from Columbia University.