America’s Mad Dash to Oligarchy

Since Ronald Reagan’s “supply-side” tax cuts for the rich – followed by other giveaways like eliminating the “death tax” so billionaires can pass on their fortunes to lucky heirs – the United States has been on a mad dash to oligarchy, as Bill Moyers and Michael Winship note.

By Bill Moyers and Michael Winship

The evidence of income inequality just keeps mounting. According to “Working for the Few,” a recent briefing paper from Oxfam, “In the US, the wealthiest one percent captured 95 percent of post-financial crisis growth since 2009, while the bottom 90 percent became poorer.”

Our now infamous one percent own more than 35 percent of the nation’s wealth. Meanwhile, the bottom 40 percent of the country is in debt. Just this past Tuesday, the 15th of April — Tax Day — the AFL-CIO reported that last year the chief executive officers of 350 top American corporations were paid 331 times more money than the average U.S. worker. Those executives made an average of $11.7 million dollars compared to the average worker who earned $35,239 dollars.

Mr. Moneybags from the "Monopoly" game

Mr. Moneybags from the “Monopoly” game

As that analysis circulated on Tax Day, the economic analyst Robert Reich reminded us that in addition to getting the largest percent of total national income in nearly a century, many in the one percent are paying a lower federal tax rate than a lot of people in the middle class. You may remember that an obliging Congress, of both parties, allows high rollers of finance the privilege of “carried interest,” a tax rate below that of their secretaries and clerks.

And at state and local levels, while the poorest fifth of Americans pay an average tax rate of over 11 percent, the richest one percent of the country pay — are you ready for this? — half that rate. Now, neither Nature nor Nature’s God drew up our tax codes; that’s the work of legislators — politicians — and it’s one way they have, as Chief Justice John Roberts might put it, of expressing gratitude to their donors: “Oh, Mr. Adelson, we so appreciate your generosity that we cut your estate taxes so you can give $8 billion as a tax-free payment to your heirs, even though down the road the public will have to put up $2.8 billion to compensate for the loss in tax revenue.”

All of which makes truly repugnant the argument, heard so often from courtiers of the rich, that inequality doesn’t matter. Of course it matters. Inequality is what has turned Washington into a protection racket for the one percent. It buys all those goodies from government: Tax breaks. Tax havens (which allow corporations and the rich to park their money in a no-tax zone). Loopholes. Favors like carried interest. And so on. As Paul Krugman writes in his New York Review of Books essay on Thomas Piketty’s Capital in the Twenty-First Century, “We now know both that the United States has a much more unequal distribution of income than other advanced countries and that much of this difference in outcomes can be attributed directly to government action.”

Recently, researchers at Connecticut’s Trinity College ploughed through the data and concluded that the U.S. Senate is responsive to the policy preferences of the rich, ignoring the poor. And now there’s that big study coming out in the fall from scholars at Princeton and Northwestern universities, based on data collected between 1981 and 2002. Their conclusion:

“America’s claims to being a democratic society are seriously threatened. … The preferences of the average American appear to have only a minuscule, near-zero, statistically non-significant impact upon public policy.” Instead, policy tends “to tilt towards the wishes of corporations and business and professional associations.”

Last month, Matea Gold of The Washington Post reported on a pair of political science graduate students who released a study confirming that money does equal access in Washington. Joshua Kalla and David Broockman drafted two form letters asking 191 members of Congress for a meeting to discuss a certain piece of legislation. One email said “active political donors” would be present; the second email said only that a group of “local constituents” would be at the meeting.

One guess as to which emails got the most response. Yes, more than five times as many legislators or their chiefs of staff offered to set up meetings with active donors than with local constituents. Why is it not corruption when the selling of access to our public officials upends the very core of representative government? When money talks and you have none, how can you believe in democracy?

Sad, that it’s come to this. The drift toward oligarchy that Thomas Piketty describes in his formidable new book on capital has become a mad dash. It will overrun us, unless we stop it.

Bill Moyers is managing editor and Michael Winship, senior writer at the policy and advocacy group Demos, is senior writer of the weekly public affairs program, Moyers & Company, airing on public television. Check local airtimes or comment at www.BillMoyers.com. Follow Winship on Twitter @MichaelWinship.

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8 comments on “America’s Mad Dash to Oligarchy

  1. Bill Jones on said:

    “Since Ronald Reagan’s “supply-side” tax cuts for the rich ”

    Taxes at the end of the Reagan Regime were almost exactly twice what they were at the end of the Carter Regime.

    There were no tax cuts.

    • blurkel on said:

      Oh, there were tax cuts alright – for the rich. My taxes as a middle class worker went up to cover that 600 ship Navy Ronnie just HAD to have, and the little wars he fought after getting kicked out ignominiously from Beiruit to prove what a bassass he really was. It took Obama (not that he is a favorite of mine) for my taxes to come down, and luckily what breaks I got lasted long enough for me to benefit. They have since been eliminated.

      Maybe soon Americans will realize that their only purpose in life is to toil for the benefit of their economiu oppressors and their mad dreams of global conquest for profit. I doubt I’ll live long enough to see that happen.

  2. rich beckmann on said:

    Mr. Bill Jones
    I’ll go out on a limb here and just say you’re full of shit. On a more diplomatic note, I’ll be an understanding, upright citizen and say the right thing, which is, show us some statistics that support your outrageous, totally false, ludicrous statement.

  3. Gordon Kralovetz on said:

    I think Bill means that taxes paid, as in the amount of money the government took in was up. Don’t forget, that he gave the middle class the largest tax increase in history and he pumped up the economy with debt. Total income to the government was much higher by the end of his term, it just started coming in from the bottom half of the bell curve while the top end saw much lower taxes. And since debt was up, the deficit was still growing despite increasing revenues.

  4. gstlab3 on said:

    All they have done since I was born in 1966 is grow the size and scope of the government and especially the police and the prison population not to mention the ever increasing burdens it places on the dwindling tax base due to retirement pensions and the glaring short sighted or is it all on purpose off shoring of the American economy in the form of tens of millions low skilled and skilled labor and value added production jobs.
    The powerfull and elite have gobbled up the resources and the earnings from multiple generations of working class, poor, the disabled and meak.
    We even no longer own our income or real property like a house your Mom and Dad lives in or how about this now?
    Even our own bodies are not our own thanks to government run health care the ACA and our ever growing punitive taxation.

  5. The oligarchs are in a mad dash to convince you of one of two things. First, that there is no oligarchy. This argument is directed at the truest fools in society. Only they will swallow it whole. The second option is intended for those that might be called secondary fools. This argument is that the “other side”, namely the Koches and Adelsons, are the real oligarchs, and the radical leftist Soroses and the fundamentally racist AIPACs and NAACPs and ADLs, and the social Marxist MSM oligarchs and the feudalist banking multinationals that fund them and advertise through them, and the agriculture overlords with their endless desire for cheap labor at the expense of the democratic will of the people, the overwhelming majority of whom have been calling for drastic immigration reduction for over half a century now (although at this point, the numbers are split because a full one third of the population is now comprised of immigrants or immigrant descendants of foreign/third world backgrounds) are the “good guys”. In reality, the leftist organizations are far more numerous in the overclass than the bad guys, have far more influence over public policy, and amongst the elite class, related amoral social Marxist / corporatist values, ideologies and types are represented far better than libertarian or conservative ideals or ideas (as demonstrated by numerous metrics, from the preponderance of Supreme Court Decisions over the last century and a half, and most election outcomes, to just a basic anecdotal survey of the views of those who linger in elite circles around major cities). And that’s little more than an obvious observation. In other words, their side, which really has far more sway over public policy and of course, the zeitgeist generally, is the side of the good guys even as they are abolishing democracy (often with the willful support of their constituencies, who just want their own ideologies imposed on the populace irrespective of the democratic will), and the other guys are dangerous and racist and right-wing and so on and so forth. Of course, that’s not what the study indicates at all. They’re using the study like good oligarchs should be expected to, to further their own agenda, rather than deal with the underlying problems, which none of their initiatives will do. The study says the elites have reduced democracy to a mere footnote, a sideshow, and that average folks have no say over public policy. It doesn’t say right-wingers have done so, and no matter how much leftist intellectuals criticize the waxing oligarchy or paint themselves as sympathizers of the masses and on the right side of history or politics, the salient irony is that their side has primarily produced it, through infinite federal supremacism, leftist activism, and their significant overrepresentation amongst the elites. I offer as indirect evidence of this the simple fact that in online analyses of the study, attacks on Koch-like characters far outweigh those on Soros-like characters, and the focus of their criticism is on the few right-wing organizations and interest groups, rather than the real, most powerful special interest groups that bejewel the Capital. Is this not itself strong evidence of the political leanings of our oligarchic elite who’ve been hell-bent on dictating public policy and deluding the people with their propaganda, restrained by no moral qualms, and with no regard for the truth of any matter, but only for their own interests and causes, for over a century now?

    http://emanuelspraguer.blogspot.com/

  6. The real oligarchs like us to keep fighting among ourselves, thus attention and ire are always drawn to things like CEO pay. Yes, it’s obscene compared to most of our wages, but still chump change compared to the real criminals, the families who started the Fed (and virtually all the wars).

    True, people we consider wealthy, those who make a million a year, get more tax breaks, perks, opportunities, etc, than the middle and lower classes.

    The point is, some doctor can’t own the news. Some trillionaire (Rothschild) can. Some lawyer can’t cause multiple nations’ currencies to crash. Soros can. Wall Street, though dishonest and disgusting for the most part, is not the cause of disruption in the market, flash trading or no flash trading. It’s the Fed who rigs the markets. It’s the Fed who controls the president and all his “men.” It’s the Fed who has their arm, the IMF, go into countries and loot first their gold as “collateral” for the loan, then imposes austerity so that their multi-national corporations can swoop in and “save” the infrastructure by privatizing it.

    Stop looking at the millionaires, folks. You can even bypass most of the billionaries.

    Repeat after me: The Federal Reserve banking families have trillions of dollars, and use it endlessly for pure evil. THEY ARE THE PROBLEM.