Summary: Every day the New America grows on the ruins of the America-that-once-was. Every day our apathy weakens the Republic. Every day powerful people — each wielding wealth greater than millions or tens of millions of other Americans — add new brinks to the new plutocracy that will govern our children and their children. They’re doing so openly. To minimize our fear and guilt we laugh at them. They smile at our folly; the Founders cry silently.
Content
- Telling us about the coming New America
- Tax rates on the wealthy at post-1930s lows. They’re not grateful…
- America’s exceptional inequality
- For More Information
(1) Telling us about the New America
“Tom Perkins’ big idea: The rich should get more votes“, CNN, 14 February 2014 — Tom Perkins speaking at the Commonwealth Club in San Francisco. Everybody has words to live by, that justify their actions. Perkins shared his with us. He’s not joking, and their increasing power brings his vision closer to fruition every day, as the 1%’s command of all levels, all parts of the governing mechanism means that our votes have less effect than his dollars.
Listen, and be afraid. Unless we develop backbones and cohesion, Perkins vision will come true. One way or another.
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(2) Tax rates on the wealthy are at post-1930s lows. They’re ungrateful…
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… They obsessively worry about a return to the high tax, high-growth, falling inequality years of the post-war era (aristocrats well know that only the peons passivity prevents successful revolts). That they so openly express their feelings, with no fear of public backlash, shows their growing confidence in not just their power but also the righteousness of their views. Rulers always believe themselves to be righteous. They’re surrounded by courtiers and priests who tell them so.
(a) Perkins’ remarks at the Commonwealth Club:
“I wouldn’t say taxation is a form of persecution. But the extreme progressivism of the tax system is.”
Cited statistics about the tax contributions wealthy Americans make, Perkins said the wealthiest 1% is carrying the government. “Government is a giant beast that has to be fed, and it’s fed with taxes. And taxes will go up and up and up.”
… Though Perkins apologized for the use of his Holocaust analogy, he did circle back to the reason for his original thinking at the event. “I think the parallel holds. The typical German had never met a Jew.”
The last question an audience member asked at the end of the event was what the 1% fears. While the Jews of Nazi Germany feared deportation and extermination, what was it that made Perkins afraid of “the war on the 1%?” Perkins said the fear is higher taxes until there is no 1%. “It’s an economic extinction, not a physical one.”
(b) “Progressive Kristallnacht Coming?” Perkins’ op-ed in the Wall Street Journal, 24 January 2014 — “I would call attention to the parallels of Nazi Germany to its war on its ‘one percent,’ namely its Jews, to the progressive war on the American one percent, namely the rich’.” On Kristallnacht, 9-10 November 1938, NAZIs staged riots targeted synagogues and Jewish-owned businesses. They killed 91 Jews and imprisoned 30,000 in concentration camps.
(c) Bloomberg Interview with Sam Zell, 4 February 2014
“I guess my feeling is that he {Tom Pekins} is right. The 1% are being pummeled because it’s politically convenient to do so. The problem is that the world and this country should not talk about envy of the 1%. It should talk about emulating the 1%. The 1% work harder. The 1% are much bigger factors in all forms of our society.”
(d) Stephen Schwarzman (chairman and cofounder of the Blackstone Group), about proposals (defeated) tax income from private-equity firms at the same rate as workers’ incomes. From Newsweek, 15 August 2010:
“It’s a war. It’s like when Hitler invaded Poland in 1939.”
(e) Bud Konheim (co-founder & CEO of Nicole Miller) on CNBC’s “Squawk Box”, 12 February 2014:
We’ve got a country that the poverty level is wealth in 99% of the rest of the world. Money is all over the place and the guy that’s making, oh, my god, he’s making $35,000 a year. So we’re talking about woe is me, woe is us, woe is this. The guy is wealthy.
Why don’t you try that out in India or some countries we can’t even name? That’s the most ignorant thing I heard all month. The standard of living, the cost of living here, is drastically different than it is anywhere else. The comment is nonsense.
I did a web piece on this. It is just blown up on the web with people saying look, if you make $35,000 a year, you are not paying the same for cost of living. He is right, we should point out, to get the top 1% globally all you need is $35,000 a year. So globally, he’s right. But wealth is all relative. It depends on where you live and what everything else costs. $35,000 a year, you couldn’t afford grey poupon. That’s right.
(3) America’s exceptional inequality
By the late 1920’s decades of growing inequality had brought the Republic’s institutions to the brink, although economic growth had maintained social stability. The Great Depression and WW2 forced our ruling elites to reverse this process. Generations of external and domestic stability allowed them to restart the engines of inequality. We are again at the levels of the late 1920s by most metrics. What happens next?
(a) “It’s the Inequality, Stupid“, Dave Gilson and Carolyn Perot, Mother Jones, March/April 2011 — “Eleven charts that explain what’s wrong with America”
(b) Presentation by Kate Pickett at the Inaugural Conference at King’s College, Institute for New Economic Thinking, 8 ‐ 11 April 2010
(4) For More Information
(a) Other articles about this great and growing problem:
- Recommended: Presentation by Kate Pickett at the Inaugural Conference at King’s College, Institute for New Economic Thinking, 8 ‐ 11 April 2010
- Recommended: “It’s the Inequality, Stupid“, Dave Gilson and Carolyn Perot, Mother Jones, March/April 2011 — “Eleven charts that explain what’s wrong with America”
- “Charts: Who Are the 1 Percent?“, Dave Gilson, Mother Jones, 10 October 2011
- “The End of Loser Liberalism: Making Markets Progressive“, Dean Baker, Center for Economic and Policy Research (2011)
- “CEO Pay in 2012 Was Extraordinarily High Relative to Typical Workers and Other High Earners“, Lawrence Mishel and Natalie Sabadish, Economic Policy Institute, 26 June 2013
- “The Money-Empathy Gap“, Lisa Miller, The New Yorker, 1 July 2012 — “New research suggests that more money makes people act less human. Or at least less humane.”
- “Money makes people right-wing and inegalitarian“, Andrew J Oswald (Prof Econ, Warwick U) and Nattavudh Powdthavee (Fellow, London School of Economics), VOX, 13 February 2014 — “Rich people typically lean right politically. Are they motivated by deeply moral views or self-interest? This column argues that money makes you right-wing. It shows that lottery winners in the UK are more likely to switch their allegiance from left to right.”
- Recommended: “Inequality By Design: It’s Not Just Talent and Hard Work“, Dean Baker, Center for Economic and Policy Research, 15 February 2014 — “the 1% are able to extract vast sums from the economy … because we have structured the economy for this purpose. It could easily be structured differently, but the 1% and its defenders aren’t interested in changing things. And the 1% and its defenders have a great deal of influence on the direction of economic policy.”
(b) Articles by Martin Gilens (Prof of Politics, Princeton) about inequality of wealth and income driving inequality of power:
- “Inequality and Democratic Responsiveness“, Russell Sage Foundation, 27 July 2012
- Economic Inequality and Political Power by Martin Gilens — Part one, part two, part three
(c) Posts about inequality:
- A sad picture of America, important for us to understand, 3 November 2008 — About social mobility
- An opportunity to look in the mirror, to more clearly see America, 10 November 2009
- Graph of the decade, a hidden fracture in the American political regime, 7 March 2010
- America, the land of limited opportunity. We must open our eyes to the truth., 31 March 2010
- Modern America seen in pictures. Graphs, not photos. Facts, not impressions., 13 June 2010
- Jared Bernstein examines the economic impact of raising taxes on high-income households, 30 April 2012
- How clearly do we see the rising inequality in America? How do we feel about it? Much depends on these answers., 27 September 2012
- Ugly truths about income inequality in America, which no politician dares to say, 2 October 2012
- Glimpses of the New America being born now, 18 June 2013
- Why Elizabeth Bennet could not marry Mr. Darcy. Nor could your daughter., 12 July 2013
- For Thanksgiving, Walmart shows us the New America, 19 November 2013
- Back to the future in New America: our new class structure, 27 November 2013
- Learning not to trust each other in America, and not to trust America, 4 December 2013
- The state of the American middle class: are we thriving or sinking?, 15 January 2014
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