Plutocracy-- When Enough Is Enough

In the late 1780's, when the French aristocracy had gotten too big for its britches, the French people, inspired by how the American colonists had thrown off the yoke of the English predators, rolled out the guillotines and cut the aristocratic class down to size. Alas, now the ruling elites are far too well-protected-- not just by private security, but by a network of slavish, brainwashed adherents courtesy of their own Fox News and Hate Talk Radio. Are the American plutocrats and oligarchs today as bad as the French versions from two centuries ago? Absolutely... if not worse. And the plutocrats have their own ironically themed Tea Party to do their dirty work for them.

Long after the French Revolution, radical Jacobin Dwight David Eisenhower was still buying into the proposition that tax policies should hold down the growth of immense inter-generational wealth that is the enemy of-- and threat to-- the nature of democracy. Tax policy, where included 90% levies on amounts in the multi-millions, allowed for the rise of the middle class and for the rise of a very well-off upper class. But it held back the rise of a plutocracy. That policy was ravaged and turned on its head by movement progressives and political creations of the plutocracy (Reagan and the two useless Bushes) and by weak, conservative Democrats, Clinton and Obama.) The result is a catastrophe for the country, approaching a divisiveness unseen since just before the Civil War. Sincere, reform-minded activists like David Atkins can come up with incremental work-arounds to halt the counterrevolution of the plutocrats, but their wealth and political "influence" allow them, in the end, the last word. There is only one answer: tax the plutocrats out of existence. It's a lot less bloody than a guillotine-- and more humane-- but we're going to need progressive leaders with spines to make it happen-- people like Bernie Sanders, Tammy Baldwin and Elizabeth Warren in the Senate and House candidates like the ones on this list.

Let me go off on a tangent for a minute. I got a call from a friend of mine Friday who was upset when he saw my denunciation of the New Dogs or New Dems or whatever that House caucus of corporate whores led by Joe Crowley calls itself. He's been endorsed by the caucus and is on the list but, he assured me, he's more progressive than his opponents. And, sure, he supports letting gays kill Third World peasants in corporate wars and he supports conformists in the LGBT community who are so intent on having fancy weddings, but on... eradicating plutocrats? I don't think so. I'll ask him next time I speak with him. He told me he didn't solicit the New Dem endorsement and that the first he heard of it was when his name popped up in a Google alert that led to a Politico story of the endorsement rollout of a gaggle of Big Business-friendly Democrats like Suzan DelBene (WA), Bill Foster (IL), Charlie Wilson (OH) and Scott Peters (CA) and well-established corruptionists like Juan Vargas (CA). He say he had never spoken to Crowley in his life until later that day when the New Dem chairman called to give him the good news. Crowley told him Hoyer and Israel had asked him to make the endorsement to send a signal to K Street lobbyists and the Big Business community that these weren't going to be a bunch of family-friend, worker-friendly, consumer-friendly radicals, but the kinds of Democrats who could easily be bought off on behalf of the corporations and the one percent. End of tangent. And on to a post by Bill Moyers and Michael Winship, Pity the Poor Billionaires. We dealt with VanderSloot and the other dangerous sociopaths on Friday in a post about the predators trying to buy the election for Romney. When Rolling Stone and others, including President Obama who they are spending nearly a billion dollars lying about, exposed them, they went into victim-mode.

VanderSloot and his wealthy pals went ballistic and cried intimidation. "You go back to the Dark Ages," VanderSloot said, "when they put these people in the stocks or whatever they did, or publicly humiliated them as a deterrent to everybody else-- watch this-- watch what we do to the guy who did this."

Conservatives described the Obama ranking of Romney contributors as an "enemies list," conjuring images of Nixonian wiretaps and punitive tax audits. But despite protestations to the contrary, these deep-pocketed plutocrats aren't shelling out the shekels for the love of flag, Mom and apple pie (or tarte tatin, as they call it in the swanky joints).

"Most of the megadonors backing [Romney's] candidacy are elderly billionaires," Tim Dickinson writes in Rolling Stone. "Their median age is 66, and their median wealth is $1 billion. Each is looking for a payoff that will benefit his business interests, and they will all profit from Romney's pledge to eliminate inheritance taxes, extend the Bush tax cuts for the superwealthy-- and then slash the top tax rate by another 20 percent." As at least one of them has said, they view these cash infusions as an "investment," plain and simple.

Dickinson claims that what VanderSloot specifically seeks are, "Fewer consumer protections. The FDA has rebuked Melaleuca for making 'false and misleading' claims about its supplements, and the company has signed a consent decree agreeing to 'not engage in the marketing and promotion of an illegal pyramid.' VanderSloot is also an anti-gay crusader: He tried to kill a PBS program for promoting 'the homosexual lifestyle,' and gave big bucks to pass California's ban on same-sex marriage." (Maybe that's why Mitt has called for privatizing PBS, admitting he's eager to see commercials on Sesame Street!)

Not that Democrats are pure of heart and innocent of venal self-interest -- many of them are all too ready to leap to the music of the ATM, too. In fact, Adam Bonica, an associate political science professor at Stanford has put together a database indicating that since 1979, 377 members of the Forbes 400 list of richest Americans have given almost half a billion dollars to candidates of both parties, most of it in the last decade. The median contribution was $355,100 each.

For evidence of the bipartisan nature of avarice, all you need to do is leap into your Wayback Machine and dial back less than twelve hours before Politico's story of angst among the generous upper classes. This time, the headline reads, "Bill would give bank a $300M benefit."

Seems the Emigrant Bank, based here in New York City, needs a loophole. "At issue is an arcane provision in the Dodd-Frank law setting out how much capital banks are required to have and in what form," Politico reported. "Emigrant, the nation's largest privately owned bank, currently has $10.5 billion in assets, according to its chief regulatory officer, Richard Wald."

At one point during the financial meltdown, Emigrant borrowed money that by the end of 2009 raised its worth beyond $15 billion. This triggered a Dodd-Frank provision requiring the bank to liquidate some of its assets.

Enter New York Republican Congressman Michael Grimm who, with the bipartisan backing of members of the House Financial Services Committee, including Democratic ranking member Barney Frank (as in Dodd-Frank), introduced a one-sentence bill-- that's right, one sentence-- moving the cut off date to March 31, 2010, when the banks assets had slipped back under $15 million. This will create a savings for Emigrant of $300 million in capital.

Emigrant has come a long way since it was founded in 1850 as a savings bank for newly arrived Irish émigrés. Now Howard Milstein, whose family is worth an estimated $3.8 billion, owns it. He was a bundler for Barack Obama's 2008 presidential campaign and a major contributor to New York Governor Andrew Cuomo.

Politico's John Bresnahan writes,

The Milsteins, along with business associates and other family members, have donated hundreds of thousands of dollars to both GOP and Democratic lawmakers over the past decade. Along with Grimm, New York Democratic Reps. Carolyn Maloney, Carolyn McCarthy and Gregory Meeks-- all co-sponsors of the bill-- have received $11,500 in donations from the Milsteins this cycle.

What's more, over the last two years, "The Milsteins have retained high-powered lobbying help to bolster their push for congressional action, at a cost of several hundred thousand dollars," including a firm which counts among its partners former New York Republican Senator Al D'Amato, whose career in Congress was but prelude to his lucrative retirement as a hustler for the mighty.

All of which leads to one last headline, via the Reuters news service on Thursday: "House panel votes to give New York bank a break." The tally was 35-15.

And the plutocrats cried all the way to the bank.

It sure would be better seeing them cry all the way to the guillotine. But I'd happily settle to just see a zero or two lopped off each of their net worths. Nobel winning economist Joseph Stigliz addressed the problem a little differently in Vanity Fair last week, explaining why America’s 1 percent—such as the six Walmart heirs, whose wealth equals that of the entire bottom 30 percent— won't be a bit more... selfish? As the widening financial divide cripples the U.S. economy, even those at the top will pay a steep price.

There are good reasons why plutocrats should care about inequality anyway-- even if they’re thinking only about themselves. The rich do not exist in a vacuum. They need a functioning society around them to sustain their position. Widely unequal societies do not function efficiently and their economies are neither stable nor sustainable. The evidence from history and from around the modern world is unequivocal: there comes a point when inequality spirals into economic dysfunction for the whole society, and when it does, even the rich pay a steep price.

Stilglitz lays out 5 probems that will soon come back to bite the plutocrats in the ass: the consumption problem, the "rent seeking" problem, the fairness problem, the mistrust problem, and the "be selfish" problem. He gives them some good advice: "When invited to consider proposals to reduce inequality-- by raising taxes and investing in education, public works, health care, and science-- put any latent notions of altruism aside and reduce the idea to one of unadulterated self-interest. Don’t embrace it because it helps other people. Just do it for yourself."