As the 1% grows more powerful, they speak their minds more boldly

Summary:  We needn’t worry if we decline the burden of self-government. The 1% will govern us. Perhaps quite well, but certainly not in our interest, but for themselves. In fact they’re already doing so. Today we review some of the evidence. It’s all around us, if we dare look. Now they feel sufficiently secure to tell us.

The One Percent That Matters
Marketing in New America

.

To the right see an example of marketing in New America. It’s a twofer: selling security to the 1%.

.

Contents

  1. Ascendant, the 1% grow bolder
  2. They already rule
  3. Showing us the New America
  4. For More Information

(1)  Ascendant, the 1% grow bolder

The Great Recession destroyed a significant fraction of the middle classes wealth, tilted the job market even more in favor of corporations over workers, and entrenched the 1%’s control of the government (as seen in the continuity of Bush Jr’s regulatory and economic policies by the Obama administration.

As a natural result, the 1% have grown bolder in public, with deranged exaggerations of efforts to regulate corporations and raise taxes.

  1. Tom Perkins warns in the Wall Street Journal op-ed “Progressive Kristallnacht Coming?
  2. Bud Konheim, CEO of luxury-goods corp Nicole Miller tells the 99% to stop whining.
  3. Stephen Schwarzman, Chairman of Blackstone Group, described proposals to raise his taxes as “It’s like when Hitler invaded Poland in 1939.”
  4. Robert Benmosche, CEO of bail-out beneficiary AIG, described public outrage over his bonuses as like the lynching of blacks in the South.
  5. Charles Munger, vice chairman of Berkshire Hathaway, explains to the 99% that “You should thank God {for bank bailouts} … Now, if you talk about bailouts for everybody else, there comes a place where if you just start bailing out all the individuals instead of telling them to adapt, the culture dies.
  6. Jack Welch, retired CEO of GE, warns about Occupy Wall Street:  “the risks of this movement’s efforts to demonize business are frighteningly high.

The for next step: they tell us that they run America, a New America, as in this conversation with Silicon Valley’s Marc Andreessen. We pick up with a reference to a new study showing that the 99% have little influence on public policy (see the next section for details).

.

Twitter-20140528-1

Twitter-20140528-2

Twitter-20140528-3

Twitter-20140528-4

.
(2)  They already rule

It’s astonishing that anyone needs evidence that the 1% runs America, but political scientists have produced numerous studies showing the obvious. Here’s the latest, and one of the best: “Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens“, Martin Gilens and Benjamin I. Page, Perspectives on Politics, Fall 2014 — Abstract:

Each of four theoretical traditions in the study of American politics – which can be characterized as theories of Majoritarian Electoral Democracy, Economic Elite Domination, and two types of interest group pluralism, Majoritarian Pluralism and Biased Pluralism – offers different predictions about which sets of actors have how much influence over public policy: average citizens; economic elites; and organized interest groups, mass-based or business-oriented.

A great deal of empirical research speaks to the policy influence of one or another set of actors, but until recently it has not been possible to test these contrasting theoretical predictions against each other within a single statistical model. This paper reports on an effort to do so, using a unique data set that includes measures of the key variables for 1,779 policy issues.

Multivariate analysis indicates that economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while average citizens and mass-based interest groups have little or no independent influence. The results provide substantial support for theories of Economic Elite Domination and for theories of Biased Pluralism, but not for theories of Majoritarian Electoral Democracy or Majoritarian Pluralism.

(3)  Showing us the New America

The front page of our newspapers show the outlines of the New America. Polls of the wealthy tell us what to expect in the future. For example, see “Democracy and the Policy Preferences of Wealthy Americans“, Benjamin I. Page, Larry M. Bartels, and Jason Seawright, Perspectives on Politics, March 2013.

It will be a Libertarian paradise for the rich, and back to the future for the rest of us (back to the Gilded Age if we’re lucky; back further if we’re unlucky).

Since the 1% owns our political apparatus (by default, since we’ve abdicated), they attend to its operations — and reap the benefits.

Page: Table-2
“Democracy and the Policy Preferences of Wealthy Americans”, Page et al, Perspectives in Politics, March 2013

.
Health care and child poverty are not their problems, and so rank low in their priorities. “Traditional values”, the obsession of social conservatives, mean little to them. The 1% don’t care about amusements and mating habits of the proles.

Page: Table-3
“Democracy and the Policy Preferences of Wealthy Americans”, Page et al, Perspectives in Politics, March 2013

.
The government should spend on things that benefit the 1%. Things that benefit the 99% are unimportant.

Page: Table-4
“Democracy and the Policy Preferences of Wealthy Americans”, Page et al, Perspectives in Politics, March 2013

.
Government exists to benefit the 1%. Quite naturally, since they own it.

Page: Table 5
“Democracy and the Policy Preferences of Wealthy Americans”, Page et al, Perspectives in Politics

.
Social mobility, the pride of America’s past, has no place in its future. De-funding public education for the poor is a good first step to that (as States have done for public colleges for a generation).

Page: Table 7
“Democracy and the Policy Preferences of Wealthy Americans”, Page et al, Perspectives in Politics

.
“I’ve got mine” is their mantra. Regulations that restrain corporate power = bad. After all, the Supreme Court has ruled that Corporations are people, too.

Page: Table-8aPage: Table-8bPage: Table-8c

.

Apollo-11: flag

(4)  For More Information

(a)  Reference pages to posts about American politics:

  1. How can we stop the quiet coup now in progress?
  2. Posts about ways to reform America
  3. Steps to political change, and reforming America
  4. Posts about seeing America clearly, in the mirror

(b)  If we don’t govern ourselves, others will govern us:

  1. A tool of the 1% tells us about the wonderfulness of unemployment, 8 April 2012
  2. How do our leaders see us? Don the shoes of the 1%. Look down on the 99%. Describe the view., 5 February 2013
  3. Important: Why the 1% is winning, and we are not, 26 July 2013
  4. Visions of the future: Adam Posen asks what the world might look like if the 1% wins., 10 August 2013
  5. Tom Perkins tells us about the 1%’s vision of a New America, 18 February 2014
  6. The shortage of STEM workers: another bogus crisis crafted to benefit the 1%, 28 February 2014
  7. Destroying campaign finance laws, another win for the 1%. Another step to a New America., 3 April 2014
  8. Important: The 1% won a counter-revolution while we played. We forgot that we are the crew of America, not passengers., 28 April 2014
  9. How the 1% runs America. Runs us. The answer points to 2 futures for us., 8 May 2014

.

.

22 thoughts on “As the 1% grows more powerful, they speak their minds more boldly

  1. Stop playing the game. Vote Green. or vote Libertarian but not for the major party candidates. The 1% can’t replace our votes yet. Stop voting for anyone who reneges on a promise. If enough of us do this maybe we can move the ball back to. Our side. Obama promised change and reneged but the majority voted for hi or against the greater evil. Stop and remove your approval. If enough do who knows.

    1. Cyaker,

      That might be a viable course. I prefer to retake one or both of our major parties. Both tactics have worked in the past.

      But I do not believe that choosing correct tactics is the vital question today. IMO success requires understanding why Americans have become so politically passive, and finding a lever to change that. Hence the series of posts about the “Castle” TV, the latest in a long effort to find a “mirror” in which we can gain a useful perspective on ourselves.

    2. @Cyaker: a childish view. Can’t get everything I want, so pick up my marbles and refuse to play the game…

      Elections work this this. There are two bowls of poop, a big bowl and a small bowl. Pick which one you want to eat. If you refuse to choose, then someone else will make the decision for you and you’ll have to follow that decision or the police will come and pour both bowls of poop down your throat. Now granted, it is frustrating to pick the small bowl only to discover that all the other middle-class and poor people picked the big bowl because they’ve been driven crazy by talk radio and Fox news. But you have to be patient. The talk radio and Fox news demographic is getting their faces kicked in by globalization, especially the younger ones and the older ones are dying off. Eventually, the tide will turn. You just have to be patient. Patience is something for adults, and therein is the problem. The American people have become infantilized, with the attention span of a chipmunk.

      You may recall that the rich were hit hard by high income and estate taxes back in the 1950’s. Did they thrown a temper tantrum like you and throw their votes and money away supporting fringe parties? Of course not. They organized and planned how to retake the ground they had lost. They thought long-term, like 100 years into the future. And what is happening now is the consequence of that long-term planning.

      I still vote for the small bowl of poop because I think it is cowardly to be kicked without even trying to fight back, but this vote is merely to make me feel better, not because I think it will change anything. There are bigger factors at play. In particular, robotics, artificial intelligence, and especially drones means the American middle-class is going to be suffering big-time in the future. Instead of trying to mobilize the middle-class, fabiusmaximus should be trying to convince the 1% that egalitarian democracy is the safest political system for the rich. Oligarchies have a bad tendency to turn into despotisms or else warlord states, in which the biggest threat to the rich is cannibalism by other rich people. See Russia or Africa for examples of places where the rich are far less safe than in so-called “hells for the rich” like Sweden and France.

    3. revelo,

      Thank you for this interesting, well-thought out and clearly expressed comment. A few additional details.

      (1) “Fox news demographic is getting their faces kicked in by globalization, especially the younger ones and the older ones are dying off.”

      There are relatively few younger viewers of Fox, or any cable news network. I don’t know what this means.

      The average Fox News viewer overall is 68.8, while the average ages of MSNBC and CNN viewers were 62.5 and 62.8, respectively.

      Take for example, “The O’Reilly Factor.” O’Reilly had his lowest month since 2001 in the key demo {age 25 – 54}, with 308,000 viewers. O’Reilly is still the No. 1 program in cable news in both total and demo viewers, averaging 2,136,000 total viewers in May. … The median age for O’Reilly is now just over 72 years old. {From Politico, 29 May 2014}

      (2) “Did they thrown a temper tantrum like you and throw their votes and money away supporting fringe parties? Of course not. They organized and planned …”

      I agree, and am astonished how few people see this. For more see Why the 1% is winning, and we are not.

      (3) “this vote is merely to make me feel better, not because I think it will change anything.”

      Yes, voting is just the bare minimum of participation. They system does not work because people vote, but because of the participation that produces the candidates, and delivers sufficient votes to win. Again, I don’t understand why people expect just voting to change things. Certainly the 1% know better.

      (4) “robotics, artificial intelligence, and especially drones means the American middle-class is going to be suffering big-time in the future.”

      I’ve written 2 dozen posts about the 3rd industrial revolution, now starting. It will create wealth, as did the previous two. The Middle Class will rise or fall depending on the distribution of that bounty, which depends on what we do.

  2. What I meant is that the sons and daughters of the Fox viewers are waking up to the fact that the policies their parents voted for aren’t working out so well for their generation (unless they happen to be mobile app developers or some other hot career). If things weren’t going sour, then these sons and daughters would be following in their parents’ footsteps and watching Fox News and voting Tea Party candidates, etc. But these shifts in opinion take time.

    Yes, distribution is everything. However, the short-term effect of robotics is to make many workers unnecessary, and the new developments in weapons and surveillance technology mean the state cannot possibly be threatened by revolution by the lower echelons. The rich have nothing to fear and thus no obvious reason to share wealth. However, there are non-obvious reasons to share, as follows.

    The reason we have elections is so the elite don’t have to fight one another directly. The Warlord state is the greatest threat to the rich, where factions among the rich each have a private army and fight one another directly, which is what happened in Latin America in the 19th century, and sort of happened in Russia in the 1990’s and happens in Africa all the time. In the United States and Western Europe, the battle between factions of the rich is conducted via a peaceful process of funding political candidates, each representing one faction, and then having the people make the decision who they want to be ruled by, with all the factions of the rich tacitly agreeing to accept the people’s verdict.

    Low voter participation would only threaten the legitimacy of the system in the sense that the rich would no longer agree to accept the people’s verdict. It certainly wouldn’t restore egalitarian democracy. Suppose a very small number of people vote. Faction A wins the election and votes to give huge tax cuts to itself, paid for by huge tax hikes on faction B (it won’t be possible to raise taxes on the people, since I’m assuming these been immiserated). Faction B refuses to accept the electoral verdict, because of the low participation and instead creates a mercenary army (bribing some of the existing military officers to join their side, taking with them existing military equipment) and starts a civil war. All this seems inconceivable now, but that is because we haven’t yet reached the level of corruption of 19th century Latin America, where scenarios like what I just described were common. In particular, the existing military is not yet open to bribery and alliances with private warlords. But we’re heading in that direction.

    Someone like cyaker who recommends low voter participation is an absolute fool. Civil war among factions of the elite is NOT going to be good for the average American. As I previously noted, our best hope is that the rich realize that 19th century Latin America and present day Russia or Africa were/are none of them paradises for the rich, regardless of low tax rates, because the rich lack security in these regimes. It is thus in the interests of the rich to push for policies that restrain their own destructive behaviors (in particular, their desire for excess concentration of wealth). While waiting for the rich to become enlightened (could take a while), we the people most definitely do NOT want to destabilize the system. So the right thing to do is participate in the voting process by voting for the smaller bowl of poop.

    1. revelo,

      Here we get into deep waters, the edge of the known. Some notes:

      (1) “What I meant is that the sons and daughters of the Fox viewers are waking up to the fact that the policies their parents voted for aren’t working out so well for their generation …”

      (1) So far I don’t see strong conclusions about the descendents of the boomers. See the survey data, with some tentative indications:

      1. Americans begin to learn, and change our views about our mad empire.“, 19 March 2014
      2. Stand by for political realignment in America!“, 20 March 2014

      (2) “However, the short-term effect of robotics is to make many workers unnecessary, and the new developments in weapons and surveillance technology mean the state cannot possibly be threatened by revolution by the lower echelons. The rich have nothing to fear and thus no obvious reason to share wealth.”

      It’s not that simple. Ours is an economy based on personal consumption. Wage stagnation — and even more so unemployment — depresses aggregate demand, and hence corporate revenue (and even more so profits). Will the 1% realize this? Will they prioritize income over more political power? Maslow’s hierarchy of needs warns us that the 1%, with every possible material need satiated, might value greater power over us over money.

      (3) “The reason we have elections is so the elite don’t have to fight one another directly.”

      Simplistic. I’d rather say that elections are part of our inheritance from the Founders, and beyond that from Britain.

      (4) “Low voter participation would only threaten the legitimacy of the system in the sense that the rich would no longer agree to accept the people’s verdict.”

      I don’t understand. Almost nobody cares about low voter participation. Certainly the 1% don’t, so long as their people win.

    2. @revelo – that’s a very interesting analysis.

      But I don’t follow how voting for a third party would be bad in such an environment. Presumably, whichever of the A/B factions is losing, would have the option of swallowing the most prominent third party, and would make some compromises in order to do so. This outcome seems to me an improvement over the status quo.

    3. @peteybee

      Maybe. Suppose the faction A party is winning. Equal numbers of discontented voters leave the faction A and the faction B party for a third party. So A continues to win. If enough people leave for the third party, that party will win. But suppose the core members of both the main parties are ideologues. Fox News dittoheads. You know some of these perhaps? They’ll never leave. Also, nothing says there will only be a single alternative party. We could a third, a fourth, a fifth party in addition to the big two. So the people who vote for these parties are basically just throwing their votes away and the election gets decided by ideologues, and if the ideologues of party A are more numerous than those of party B, then A wins even if the total number of these ideologues is only like 25% of the population.

      You can certainly come up with scenarios where your strategy works better. But I think my strategy is more robust under the scenarios we are most likely to face. Everyone who thinks one party is crazy (big bowl of poop) should vote for the other party (smaller bowl of poop). What happens then is the crazy party gets pushed aside and eventually goes out of existence. THEN and only then is the time to split the other party up. Now you repeat the process, and eventually you end up with a really tiny bowl of poop running things.

    4. @revelo.

      Ok, I think I understand your reasoning better now. I want to be convinced that it would work.

      Has there been any sign at all that the 2 major parties are shrinking in their % of the votes cast, or that one party is universally regarded as crazy, and will lose so bad that it is eliminated? Don’t they consistently end up close to 50/50 in presidential elections, and just seesaw back and forth in congress in a ~10 year cycle?

      I have come to the conclusion that if you vote for what you believe is the “smaller bowl of poop”, you’ll end up stuck with this still-disgusting bowl, without really doing much to make the other bowl go away, or otherwise escape from the dilemma.

    5. >Don’t they consistently end up close to 50/50 in presidential elections, and just seesaw back and forth in congress in a ~10 year cycle?

      Unfortunately, yes. And this gets back to the American people having the attention span of a chipmunk. They seem unable to understand that one party is worse than the other on the issues that really matter. Until the people wake up, there can be no progress. But you’re certainly not helping matters by being impatient yourself and abandoning the system. If it take another 50 years for the American people to wake up, then you have wait another 50 years to see change. Too bad. The rich got where they are today by being patient and far-thinking starting in the 1950’s, including setting up all sorts of propaganda organs.

      If you want to speed up the process of change, selectively discuss politics face to face with young people (old people who watch Fox are hopeless, just wait for them to die). Won’t make a big difference if one person does it. If everyone does it, it will eventually make a big difference.

  3. >>“Low voter participation would only threaten the legitimacy of the system in the sense that the rich would no longer agree to accept the people’s verdict.”

    >I don’t understand. Almost nobody cares about low voter participation. Certainly the 1% don’t, so long as their people win.

    The 1% (or rather .01%, since that is who really rules) is not monolithic. There are always factions. So far, these factions have tacitly agreed to accept the verdict of the 99% as to which faction will dominate, to avoid a civil war between factions. But things might not always be that way. It isn’t that way in Africa, it wasn’t that way in Latin America in the 19th century, it wasn’t that way in Russia in the 1990’s. I think there is some relation between high voter participation and willing by the factions to accept the verdict of elections, though cause-effect relationship here doesn’t have to exist. The factions of the rich could begin fighting among one another even with high voter participation, or they could continue to accept the verdict even with low voter participation.

  4. My view is that we are beginning to push against the resource wall, oil doggedly stuck above 100$ despite so-so economic perfomance in much of the world is quite a red flag for me, and I see preciously few signs that were are going to get any actual relief in the energy field beyond vaporware, subsidies sinks and various schemes that overpromise and underdeliver. So while it is accurate to point out that our social system is defaulting to its natural, Gilded Age state (a prelude to much worse I fear) I have started to doubt whether it is going to remain possible to keep the 99% in what have been historically unprecedented level of material comfort regardless of policies followed.

    1. Marcelo,

      I don’t understand.

      *. Real oil prices are below those of early 1980s and the recent spike 2008.
      *. Coal prices are really low, and might go lower as new regulation throttle back demand.
      *. Real and even nominal natural gas proves are very low.

      So the bulk of our primary energy sources are unusually cheap. Nukes and hydro are flattish. Energy is so abundant that we are — quite sensibly IMO — throttling back use of the dirter sources.

      Ditto with most other raw material inputs.

      Fresh water is the exception because most of the demand is not subject to market prices. Underpriced goods are usually scarce, by definition.

  5. They were in fact spikes and the 1980 one was caused by two key gulf producers going almost completely offline. Nowadays they appear to be stuck at historically high levels.
    Low natural gas prices are likely a temporary effect of the fracking frenzy flooding an unprepared market: once export terminals are in place, depletions rate of fracked wells takes its toll etc. price wil probably increase to more international levels. As for coal I suspect it may be temporary too and we will see more of this:
    http://www.ft.com/intl/cms/s/0/e6470600-77bf-11e3-807e-00144feabdc0.html
    In the event time will tell.

    1. Marcello,

      I see almost no evidence supporting your beliefs.

      (1). The early 1980s price period — as high as today in real prices — was not a spike. The following price crash, and that after 2008, were supply-led (e.g., the on-going surge in US and Canadian output). These do not show oil as a resource constraint.

      (2). There is little evidence that fracking is a temporary event (although people have said that repeatedly during the past 3 years). It’s potential has not been fully tapped in the US. There are equivalent deposits in much of the rest of the world, as yet untapped.

      (3). I cannot imagine why you say that low coal prices will not continue. That German coal use is high is trivia. US is much larger user, producer, & exporter — and is mining at far below potential.

    2. “The following price crash, and that after 2008, were supply-led ”

      I am inclined to think that 2008 crisis helped quite a bit to moderate oil price. For a while at least.

      “It’s potential has not been fully tapped in the US.”

      And likely it won’t for the time being:

      http://www.latimes.com/business/la-fi-oil-20140521-story.html

      That for oil but if you look at gas production on the EIA website some of the gas shale plays (Haynesville, Barnett) have already started to show the minus sign in 2013. For the time being total production is still increasing but how long the trend will last is open to debate. And in any case once american gas infrastructure becomes more connected to the international market prices will likely adjust upwards anyway.

      “I cannot imagine why you say that low coal prices will not continue. That German coal use is high is trivia. US is much larger user, producer, & exporter — and is mining at far below potential.”

      The existing stock of nuclear plants in the West won’t last forever and it does not look like it will be replaced by more. Thus I would expect that demand for base load power will turn to coal again, as it did in Germany despite their lofty environmental aims.

      That is the basis for my previous reasoning. I will note that economy is still sluggish, Europe is still underperforming and the last US data showing a minus sign. Where would oil price be should there be a substantial recovery in both areas? Would coal price still be low? I would have my doubts about that.

    3. Marcelo,

      You have assembled little pieces of data to support a pre-conceived an idea. Well, ok. I point out a few things, and give up the conversation.

      (1) global GDP continued to grow, but slower, during the global recession — so I don’t see how that reduced energy demand. But the additional ~3 million b/day of US production certainly had an effect, along with increased supply from the ROW.

      (2). Yes, natural has prices will probably rise. But your original point was that current US energy prices were LOW, indicating resource scarcity. That was false.

      (3) you can guess to your heart’s content about the future. I doubt you are any better at it than the other resouces-are-running-out-OMG people making that case since the early 1970s.

  6. How come you gus appear oblivious to the Bilderberg Meetings?

    http://www.globalresearch.ca/bilderberg-member-admits-secretive-confab-more-powerful-than-davos/5383603

    Bilderberg Member Admits Secretive Confab More Powerful than Davos. Real decisions made at Bilderberg, Davos “pure PR talk”
    http://www.theguardian.com/world/2014/may/29/bilderberg-60-inside-worlds-most-secretive-conference

    Bilderberg at 60: inside the world’s most secretive conference
    Topics on the agenda for the three-day summit first held on 29 May 1954 will include: does privacy exist?
    http://www.theguardian.com/world/2014/may/30/bilderberg-copenhagen-2014-osborne-mandelson-balls

    Bilderberg conference 2014: eating our politicians for breakfast. George Osborne, Lord Mandelson, Ed Balls and Eric Schmidt arrive for day two of the conference in Copenhagen
    http://www.theguardian.com/world/2014/may/31/bilderberg-ukraine-summit

    Bilderberg on Ukraine: military chiefs, arms bosses and billionaire speculators. A gathering of those who stand to make a killing out of knowing where and when the bombs might fall, how many and on whom
    http://www.cfoss.com/harper.html

    Canadian Politicians And The Bilderbergers
    http://www.prisonplanet.com/articles/june2008/060608_hillary_obama.htm

    Hillary & Obama In Secret Bilderberg Rendezvous
    http://www.corbettreport.com/articles/20090624_bilderberg_predictions.htm

    Bilderberg 2009 Intel Already Proving Accurate. Veteran Bilderberg researchers Jim Tucker and Daniel Estulin hit the mark once again as insider info becomes reality

    1. Winston,

      “How come you gus appear oblivious to the Bilderberg Meetings?”

      Simple. Because the fact of the 1%’s power is important. That the mechanism by which they coordinate is trivial. They might meet at the local YMCA’s, or at groups like the Bliderberg. Given their power, the coordinating mechanisms have no special significance.

      If they communicated by conference calls, would we consider conference calls a semi-mystical mechanism deserving special study?

  7. Bilderberg explains how 1% coordinate, policies. Interesting how despite fact it has been going on since 1950s, it is now a crony capitalism platform.

    Articles for you:
    http://theconversation.com/failing-union-of-capitalism-and-democracy-fuels-rise-in-inequality-27217
    Failing union of capitalism and democracy fuels rise in inequality

    http://www.theguardian.com/commentisfree/2014/jun/02/control-nation-states-corporations-autonomy-neoliberalism

    Who’s in control – nation states or global corporations?
    Around the world, calls for national autonomy have grown. Minorities are blamed but the real culprit is neoliberalism

    1. winston,

      “Who’s in control – nation states or global corporations?”

      The question is reification, a logical fallacy. People are in control, not these abstract entities called States and Corporations.

      We lose because we prefer to shadow-box. Nation-states! Corporations! Bilderberg! Trilateral Commission!

      The 1% laugh.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.