23 April 14
he 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 US worker. Those executives made an average of $11.7
million dollars compared to the average worker who earned $35,239
dollars.
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 US 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.
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