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How the Oligarchs Took America

Discussion in 'BBS Hangout: Debate & Discussion' started by Invisible Fan, Mar 1, 2011.

  1. Invisible Fan

    Invisible Fan Contributing Member

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    http://motherjones.com/print/89631

    There is a war underway. I'm not talking about Washington's bloody misadventures in Afghanistan and Iraq, but a war within our own borders. It's a war fought on the airwaves, on television and radio and over the Internet, a war of words and images, of half-truth, innuendo, and raging lies. I'm talking about a political war, pitting liberals against conservatives, Democrats against Republicans. I'm talking about a spending war, fueled by stealthy front groups and deep-pocketed anonymous donors. It's a war that's poised to topple what's left of American democracy.

    The right wing won the opening battle. In the 2010 midterm elections, shadowy outside organizations (who didn't have to disclose their donors until well after Election Day, if at all) backing Republican candidates doled out[4] $190 million, outspending their adversaries by a more than two-to-one margin [4], according to the Center for Responsive Politics. American Action Network, operated by Republican consultant Fred Malek and former Republican Senator Norm Coleman, spent $26 million; the US Chamber of Commerce plunked down $33 million; and Karl Rove's American Crossroads and Crossroads GPS shelled out a combined $38.6 million. Their investments in conservative candidates across the country paid off: the 62 House seats [5] and six Senate seats [6] claimed by Republicans were the most in the postwar era—literally, a historic victory.

    Knocked out of their complacency, no longer basking in the glow of Barack Obama's 2008 victory, wealthy Democrats are now plotting their response. Left-wing media mogul David Brock plans to create an outside group dubbed American Bridge in response to Rove's Crossroads outfits that will fight in the trenches of 2012 campaign spending. Many more outfits like Brock's will surely follow, as liberal and centrist Democrats brace for a promised $500 million onslaught by the Chamber of Commerce and others of its ilk.

    Even the Obama administration, which shunned outside groups in 2008, has opened the door to a covert spending war. The Democrats will now fight fire with fire. "Is small money better? You bet. But we're in a ****ing fight," Democratic strategist and fundraiser Harold Ickes told me [7] recently. "And if you're in a fistfight, then you're in a fistfight, and you use all legal means available."

    The endgame here, of course, is non-stop war. No longer will outside groups come and go every two years. Now, such groups will be running attack ads, sending out mailers, and deploying robo-calls year-round in what is going to become a perpetual campaign to sway voters and elect friendly lawmakers. "We're definitely building a foundation," was how American Crossroads president Steven Law put it [8].

    This is what nowadays passes for the heart and soul of American democracy. It used to be that citizens in large numbers, mobilized by labor unions or political parties or a single uniting cause, determined the course of American politics. After World War II, a swelling middle class was the most powerful voting bloc, while, in those same decades, the working and middle classes enjoyed comparatively greater economic prosperity than their wealthy counterparts. Kiss all that goodbye. We're now a country run by rich people.
    Not surprisingly, political power has a way of following wealth. What that means is: you can't understand how the rich seized control of American politics, and arguably American society, without understanding how a small group of Americans got so much money in the first place.

    That story begins in the late 1970s and continues through the Obama years, a period in which American policy has been so skewed toward the rich that we're now living through the worst period of income inequality in modern history. Consider the statistics: 50 years ago, the wealthiest 1% of Americans accounted for one of every 10 dollars of the nation's income; today, it's nearly one in every four. Between 1979 and 2006, the average post-tax household income (including benefits) of the wealthiest 1% increased by 256%; the poorest households saw an increase of 11%; middle class homes, 21%, much of which was due to the arrival of two-job families.

    Tax guru David Cay Johnston recently crunched [9] new Social Security Administration data and discovered an even starker divide. On the one hand, the number of Americans earning a steady income declined by 4.5 million between 2008 and 2009, and the average wage in the US dipped by 1.2%, to $39,055. On the other hand, the average wage among Americans earning more than $50 million per year was $91 million in 2008 and $84 million in 2009.
    Harvard University economist Lawrence Katz put the situation Americans now find themselves in this way [10]:

    "Think of the American economy as a large apartment block. A century ago—even 30 years ago—it was the object of envy. But in the last generation its character has changed. The penthouses at the top keep getting larger and larger. The apartments in the middle are feeling more and more squeezed and the basement has flooded. To round it off, the elevator is no longer working. That broken elevator is what gets people down the most."

    Let's call those select few in the penthouse the New Oligarchy, an awesomely rich sliver of Americans raking in an outsized share of the nation's wealth. They're oil magnates and media tycoons, corporate executives and hedge-fund traders, philanthropists and entertainers. Depending on where you want to draw the line, they're the top 1%, or the top 0.1%, or even the top 0.01% of the population. And when the Supreme Court handed down its controversial Citizens United decision in January, it broke the floodgates so that a torrent of anonymous donations from this oligarchic class could flood back down from the heights and inundate the political lands below.

    "The Thirty-Year War"

    How did we get here? How did a middle-class-heavy nation transform itself into an oligarchy? You'll find answers to these questions in Winner-Take-All Politics [11], a revelatory new book by political scientists Jacob Hacker and Paul Pierson. The authors treat the present figures we have on American wealth and poverty as a crime scene littered with clues and suspects, dead-ends and alibis.
    Unlike so many pundits, politicians, and academics, Hacker and Pierson resist blaming the usual suspects: globalization, the rise of an information-based economy, and the demise of manufacturing. The culprit in their crime drama is American politics itself over the last three decades. The clues to understanding the rise of an American oligarchy, they believe, won't be found in New York or New Delhi, but on Capitol Hill, along Pennsylvania Avenue, and around K Street, that haven in a heartless world for Washington's lobbyists.

    "Step by step and debate by debate," they write, "America's public officials have rewritten the rules of American politics and the American economy in ways that have benefitted the few at the expense of the many."[12]

    Most accounts of American income inequality begin in the 1980s with the reign of President Ronald Reagan, the anti-government icon whose "Reaganomics" are commonly fingered as the catalyst for today's problems. Wrong, say Hacker and Pierson. The origins of oligarchy lay in the late 1970s and in the unlikely figure of Jimmy Carter, a Democratic president presiding over a Congress controlled by Democrats. It was Carter's successes and failures, they argue, that kicked off what economist Paul Krugman has labeled "the Great Divergence." [13]
    In 1978, the Carter administration and Congress took a red pen to the tax code, slashing the top rate of the capital gains tax from 48% to 28%—an enormous boon for wealthy Americans. At the same time, the most ambitious effort in decades to reform American labor law in order to make it easer to unionize died in the Senate, despite a 61-vote Democratic supermajority. Likewise, a proposed Office of Consumer Representation, a $15 million advocacy agency that was to work on behalf of average Americans, was defeated by an increasingly powerful business lobby.

    Ronald Reagan, you could say, simply took the baton passed to him by Carter. His 1981 Economic Recovery and Tax Act (ERTA) bundled a medley of goodies any oligarch would love, including tax cuts for corporations, ample reductions in the capital gains and estate taxes, and a 10% income tax exclusion for married couples in two-earner families. "ERTA was Ronald Reagan's greatest legislative triumph, a fundamental rewriting of the nation's tax laws in favor of winner-take-all outcomes," Hacker and Pierson conclude.

    The groundwork had by then been laid for the rich to pull definitively and staggering ahead of everyone else. The momentum of the tax-cut fervor carried through the presidencies of George H.W. Bush and Bill Clinton, and in 2000 became the campaign trail rallying cry of George W. Bush. It was Bush II, after all, who told [14] a room full of wealthy donors at an $800-a-plate dinner, "Some people call you the elites; I call you my base," and who pledged that his 2001 tax cuts would be a boon for all Americans. They weren't: according to Hacker and Pierson, 51% of their benefits go to the top 1% of earners.
    Those cuts will be around a lot longer if the GOP has its way. Take Republican Congressman Dave Camp's word for it. On November 16th, Camp, a Republican from Michigan, said [15] the only acceptable solution when it came to the Bush-era tax cuts was not just upholding them for all earners, rich and poor, but passing more such cuts. Anything in between, any form of compromise, including President Obama's proposal to extend the Bush cuts for the working and middle classes but not the wealthy, was [15] "a terrible idea and a total non-starter."

    Why should you care what Dave Camp says? Here's the answer: in January, he's set to inherit the chairman's gavel on the powerful House Ways and Means Committee, the body tasked with writing the nation's tax laws. And though most Americans wouldn't even recognize his name, Camp's message surely left America's wealthy elites breathing a long sigh of relief. You could sum it up like this: Fear not, wealthy Americans, your money is safe. The policies that made you rich aren't going anywhere.

    Page 2 discusses Citizens United and financial deregulation.
     
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  2. CrazyDave

    CrazyDave Contributing Member

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    by the time anyone figures out that it matters and what to do about it, those that are and have been in power will have changed all the rules to keep it from mattering. Sadly, we can only hope it is so egregious that there is sufficient backlash to set things right.
     
  3. thadeus

    thadeus Contributing Member

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    Excellent article.

    What we desperately need is for the suckers who have bought into the wealthy propaganda of business somehow being a check on government to wake up. They're on the same team - they're both screwing us: the wealthy by sucking up a vastly disproportionate percentage of economical power, and the government by being both terminally inept at dealing with the real issues and by allowing the wealthy to co-opt the political process through massive campaign "donations."

    We truly need these people to wake up to the fact that the real, practical, and influential distinction in this country is not a vertical divide that separates left and right, but a horizontal divide that separates the ultra-wealthy from the middle and working classes.

    If we can get those people to at least pay SOME attention to what's really going on then we might be able to undo some of the damage done over the past 30 years. But, if the ultra-wealthy continue to exert their influence over the minds of government-fearers, then no real improvement is going to come because the middle- and working-class will be so busy fighting amongst themselves that the ultra-wealthy will just continue feeding us bull**** and enriching themselves off of our misfortunes.

    But, most of the time, those people seem so impeccably propagandized that it is very difficult to believe that they'll ever wake up. The ultra-wealthy and their lap dogs in federal and state government have basically been taking a giant **** on us for the past 30-40 years, so I don't know what they'd have to do to get the propaganda-zombies to finally say "enough." Even when the ultra-wealthy do something ever more heinous than the things they've already done, they'll just get the news media to smooth it over and make it look like some other ideological left vs. right debate, when, in fact, it's just them continuing to squirt diarrhea all over us and all over this country.
     
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  4. Dubious

    Dubious Contributing Member

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    The cycle of the consolidation of power by the few and the eventual revolt by the many continues. But it is being geared up to hyper speed with the advent of universally shared information.

    Politics swing like a pendulum do.

    I'm thinking that this rising new democracy might become actually less republic more democratic if everyone who choses to can be informed, and actually participate in in government; until someone figures out how to subvert that like they have the American brand.
     
  5. B-Bob

    B-Bob "94-year-old self-described dreamer"

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    It's less clear to me than ever that money manifest as attack ads, robo-calls, and mailings correlates to much of a political outcome. Probably only with people 50 and up, and that's largely who voted during the last election.

    If a broad spectrum votes, I think the money has less per-dollar influence than ever, strangely and fortuitously. But I could be wrong.
     
  6. thegary

    thegary Contributing Member

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    the problem is that the intellectually uninquisitive in our country have bought too hard into the american dream. we are all taught from a young age about the greatness of our country. fair enough, but societies evolve, and we must evolve with the times. people fear change, even when it's in their best interest.
     
  7. Karlfranklin

    Karlfranklin Member

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    Voters think they make the choice, they're not, because they can't choose the candidates. The candidates are representatives of the rich, they offer you lip services, get elected and leave you in the dust as useful fools.

     
  8. FranchiseBlade

    FranchiseBlade Contributing Member
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    Which is why we should have more than a two party system. It should be easier for multiple parties to have candidates at least in congressional, state, and local elections.
     
  9. basso

    basso Contributing Member
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    what does that even mean? we shouldn't teach kids of the greatness of america?
     
  10. thegary

    thegary Contributing Member

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    but this goes back to the problem of how much money goes into the campaigns. no way for an outside party to compete financially. we are stuck until it doesn't matter how big a candidate's war chest is compared to his opponent's.
     
  11. thegary

    thegary Contributing Member

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    i'm saying that children should be taught how to, and given the opportunity to contribute to that greatness. america is the land of opportunity for all, no?
     
  12. Karlfranklin

    Karlfranklin Member

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    Entitlement and ignorance of outside world kill. The school system should present hard evidences, knownledge of other countries and help make their own judgement, instead of indoctrination. Or at least educate them how America became of today, and how we make it better.

     
  13. basso

    basso Contributing Member
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    how to what?
     
  14. thegary

    thegary Contributing Member

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    how to not be disingenuously misinformed
     
  15. basso

    basso Contributing Member
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    what evs- i think we should teach children how to think, and, excepting basic facts about history, economics, math, and (most important subject of all) geography, not what to think. i also see nothing wrong with highlighting american accomplishments, while also noting we always have room to grow and improved.

    but yeah, down with the oligarchs and fat-cats.

    [​IMG]
     
  16. rtsy

    rtsy Member

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    Haha Typical, fat liberal union-supporting American liberal. Hitler went after fat people, then the jews.
     
  17. thegary

    thegary Contributing Member

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    basso, i never said we shouldn't highlight america's accomplishments. not sure where you are objecting.
     
  18. weslinder

    weslinder Contributing Member

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    Maybe I'm missing a joke here, but this seems really inappropriate.
     
  19. thegary

    thegary Contributing Member

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    i just flat out don't know what he's on about.
     
  20. basso

    basso Contributing Member
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    maybe i misread your comment, but i inferred, based on the OP, that you were taking exception to the idea of american exceptionalism.

    if not, then please disregard.
     

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