What a week. Every week, every day, T provides a new outrage. This week, we all saw T fail to hold Putin accountable for hacking into Democratic and Republican computers and emails and the computer systems of state electoral boards. He also sided with Russia against U. S. intelligence assessments. He basically colluded in public with Russia. Yet, the GOP, after a few harsh words early in the week, by the end they let it all slide.
How did politics in the US get so bad? What role did economic manipulation play in the increasing divisiveness in the U. S. since the early 1990s or before? Institutional racism, sexism, anti-semitism, etc. played a huge role, but I need to center for the moment on economics or my head and heart will spin ⎼ too much information for me to digest.
Why are Democrats seemingly so ineffectual and the GOP so ready to support whatever T does, even when he puts Russia before US interests, dictatorship before Democracy? Why does the GOP walk so much in lockstep, ready to stomp on the humanity, rights, health care and income of so many in the middle and lower classes?
And the goose or lock stepping of the GOP is not just an example of politicians afraid of their base or afraid of losing their position, as many in the centrist media portray it. The base of the GOP itself is something relatively new in US politics, even though it has been developing for years. Since Reagan, the GOP has become increasingly intransigent and devoted to only one small group of people—the white super-rich. T is also something relatively new, but he is a poison in a garden that was already laid waste by politicians unable and unwilling to halt the pressure by the super-rich to undermine any restraints on their power.
One book I’ve been reading to help me gain some clarity is Billionaire Democracy: The Hijacking of the American Political System by economist George Tyler. This is an important book to read. It talks not only about how democracy has been hijacked, but how to take it back. In 1980, according to Tyler, the richest 0.1% contributed less than 10% of all campaign contributions. By 2012, their share increased to 44%. In 2016, it increased to about 66% of contributions to Congressional candidates.
Along with this trend in political contributions is a trend many have noted in wealth controlled by the top 1%. In the 1920s, before the depression, the top 1% owned 44.2% of the wealth. During the depression, and even more, during the war, the taxes on the rich were raised to 94% for top earners, and the percentage of wealth owned by the rich by 1945 was down to 29.8%. By 1979, the percentage owned by the 1% was down to only 20%. Thanks to Reagan, the percentage of wealth owned by the super-rich went up. By 2013, the top 1% owned 36.7% of US wealth. The top 20% of the US population in terms of wealth owned 89%, leaving only 11% for the remaining 80% of people. In 2017, the top 1% owned 42.8%. It has been increasing by 6% annually since the mid-2000s. (See my chart on the last page.) And the GOP tax cut is only making income inequality worse.
America’s wealthiest 20 people own more wealth than the bottom half the population, own more than 152,000,000 people combined. Among the Forbes 444, only 2 are African-American.
Tyler analyzes how the super-rich used their wealth to buy a political party. They went about this from several directions. They first chose a party that had favored the super-rich since the Gilded Age and the Robber Barons. According to the Center for Responsive Politics, in the primary season for the 2016 presidential election, nearly half of all political contributions came from about 158 families. 158 families! 87% went to the GOP.
Second, Tyler explains how the party “culled” most of its more moderate members from their ranks or leadership positions. They culled those who would actually work with Democrats, or support Medicare, capital gains taxes, public schools, or work to limit soft money donations, etc. For example, former Senator Olympia Snowe was a moderate Republican from Maine. She was booed in the Republican convention in Bangor because of her history of cooperating with Democrats. Soon after that, she stopped her bid for reelection. (A similar thing occurred with U. S. Rep. Mark Sanford, who was a critic of Mr. T and lost his bid to run again for Congress after T tweeted his support to Sanford’s challenger.)
Third, the super-rich bought a movement, the Tea Party. When the Tea Party was just getting organized in 2009, wealthy donors like the tobacco industry and the Koch brothers helped finance their meetings, conventions and advertising, yet so many of their members had no idea this was happening.
Fourth, Tyler clarifies how the rich bought media outlets and continue to do so today. The Tea Party movement was created not only with the money of the wealthy but by their control of the media. Rupert Murdoch, for example, bought Fox news and turned it into the propaganda outlet of the rich and right-wing. The super-rich funded media that spread an anti-government, anti-tax, anti-any-social-program that actually was helpful to the lives of most Americans.
The rules obliging the broadcast media to provide factual reporting (called the Fairness Doctrine, spelled out in 1947) were undone in 1987 by Reagan. As Tyler put it, “since Ronald Reagan…broadcasters have abandoned objectivity in favor of an afactual, partisan din. Fables foisted as reality have become commonplace…” (p. 193) The Trumpian attack on facts and truth has been developing for decades.
In Federalist 68, Alexander Hamilton warned of “cabal, intrigue, and corruption… chiefly from the desire in foreign powers to gain an improper ascendant in our councils. How could they better gratify this, than by raising a creature of their own to the chief magistracy of the union…?” Hamilton greatly feared a misinformed citizenry. His fears were eerily actualized in the Russian interference in the 2016 presidential election. In fact, as Tyler puts it, the GOP strategy was to undermine exactly what the framers meant to preserve. They “demonize[d] the fact-based information industry central to the framer’s vision of a democracy sustained by an informed electorate.”
Fifth, the super-rich went after the legal system, including the Supreme Court. They used the concept of the personhood of a corporation to advance their agenda and diminish governmental restrictions on their power. This concept was nowhere to be found in discussions by the Founding Fathers and was nowhere mentioned in the history of the court prior to the 1880s.
According to Tyler, in the 1880s Roscoe Conklin, a lawyer representing a railroad baron, introduced the idea that the 14thamendment was passed not only to protect the civil rights of African-American males but also protect corporations from government interference. Conklin argued for this idea despite the total lack of any evidence for it. There were no records of it being mentioned in any of the discussions that led to the passage of the 14thAmendment in 1867. In 1886, his fabricated doctrine helped win a case protecting the railroads from “bothersome” taxes levied by the county of Santa Clara on the railroads. It has been used since to protect the rich from the rest of us.
The founding fathers, explained Tyler, distrusted big corporations and thought contributing to a political campaign was a way to buy a politician. It was, thus, a criminal act. Vote buying undermined the integrity of voting. This criminality became legally protected by the Citizens United Supreme Court decision of 2010, which synthesized two evils. It not only reinforced the personhood of corporations. It released corporations and the super-rich from most restrictions on the buying of politicians. It said that corporations, like people, have the right of free speech. And making political contributions was a form of protected speech, not to be restricted.
The whole idea that a corporation should be considered a person is ludicrous. Corporations were never given the vote, don’t give birth, don’t shake hands or die, except metaphorically. The rich who own and manage corporations already have a vote and a voice, if they are citizens. Why give them what amounts to two or thousands of votes? The constitutional guarantee of free speech refers to guarding the content of speech, not its volume.
Apparently, most Americans know that the rich have too much influence on the government. According to the Public Religion Research Institute, in 2015, 79% of Americans (63% of Republicans) said our economic system unfairly favors the rich. A similar view is held about the government. And the support shown to Bernie Sanders in 2016 (and maybe even to T himself) seems to confirm this.
Taxing the rich is one traditional way to exercise a little control over how wealthy the wealthy can be. It is not socialism, but is how the U. S. financed a winning strategy in World War II. It is how, in the 1950s and 1960s, we experienced the greatest growth of the middle class in our history. From the 1940s to 1980s, the highest earners paid more than double what they do now in taxes. In fact, from the 1940s to 1960s, the highest tax bracket was around 90%. Reagan’s first tax cut lowered the top tax rate from 70% to 50%; in 1989, it was down to 28%. Since then, the rates have gone slightly up and down, down especially with the latest GOP tax cut to the super-rich. (See below.)
Meanwhile, today, most of us pay in real taxes about 25% of income, which includes property, sales and other taxes, not only income tax. This puts the US at the lowest tax levels of all nations except for Korea, Chile, and Mexico.
So, when we think about how to take back or create democracy, we have to keep in mind who really constitutes the base of the GOP and T. We have to find a way to lessen the influence and control of the super-rich over public policy and all our lives.
And we have to find out how Russia fits into the plans and manipulations of the super-rich.
Chart Showing How Increasing Taxes Lowers Income Inequality (Compiled from different sources.)
||% of wealth controlled by the top 1%
||Income tax rates for the wealthiest of us
||37.2 – 38.1
||28 – 39.6%
||Estimate: 45.3% (6% increase per year since 2008)