“Share Our Wealth”: Plutocracy Is the Problem + Does Extreme Wealth Make You a Sociopath?
+ Steve McQueen and Gary Younge on Black British immigrants + the genius of Schitt’s Creek
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The Louisiana populist Senator Huey Long proposed a radical “Share Our Wealth” program in a remarkable set of speeches in the 1930s, largely lost to our collective cultural memory. At the height of his popularity, Long mounted an insurgency that Franklin Delano Roosevelt viewed as a serious threat to his 1936 re-election. FDR tacked dramatically to the left to blunt the appeal of Long’s populism with a second New Deal program that included Social Security and the Wealth Tax Act. Over 27,000 grassroots “Share Our Wealth” clubs with millions of members organized around the country to advocate for Long’s redistributionist program.
Long’s core proposals were to cap the amount of wealth and income that any person could own (at would be about $60 million today), to limit inheritances, and to guarantee that no person had an income below one-third of the national average.
Long argued that: “The same mill that grinds out the extra rich is the same mill that will grind out the extra poor, because, in order that the extra rich can become so affluent, they must necessarily take more of what would ordinarily belong to the average man.” This 4-minute excerpt of a classic Long speech feels both strange and yet resonant. There’s a clarity to his Share Our Wealth program that is relevant to our times. The Platypus wonders what might happen if such a mass organizing effort around a bold national demand were renewed today? (While the Share Our Wealth program has appeal, we don’t need politicians in Long’s mold – his tactics were autocratic and Trumpian while his reputation for racial “moderation” is undeserved).
The conditions are ripe. New data from Forbes’ annual billionaires’ survey shows that while billions of people endured hardship during the pandemic, “the world’s billionaires added more than $5 trillion to their wealth over the last year, with the richest 2,755 people on earth amassing more than $13 trillion,” according to The Independent.
Moreover, as Sarah Anderson at the Institute for Policy Studies reports
Since 1985, the average Wall Street bonus has increased 1,217 percent, from $13,970 to $184,000 in 2020. If the minimum wage had increased at that rate, it would be worth $44.12 today, instead of $7.25.
The total bonus pool for 182,100 New York City-based Wall Street employees was $31.7 billion — enough to pay for more than 1 million jobs paying $15 per hour for a year.
It is perhaps not surprising under such circumstances that strong majorities of the public support a wealth tax on billionaires, according to polls conducted over the last year. Intriguingly, the public supports Biden’s infrastructure plan even more when they know that higher taxes on the rich are part of it. As Sahil Kapur of NBC News tweets, “Buried in the new Morning Consult/Politico poll is an eye-popping statistic: Voters by a 2-to-1 margin prefer a $3 trillion infrastructure bill that includes tax hikes on $400K+ and corporations over one that excludes those tax hikes.” A study by Americans for Tax Fairness and the Institute for Policy Studies shows that the profits earned by American billionaires during the pandemic alone could pay for 70% of Biden’s plan.
We’ll be doing a few issues on the topic of plutocracy and its discontents over the next few months.
Reminder: RSVP for the launch events for Immigration Matters: Movements, Visions, and Strategies for a Progressive Future on 4/27 and 4/28 –details below – we hope you’ll come! Also a great event on 4/23 at CUNY’s School of Labor and Urban Studies on “Working Class New York - Revisited” that you can register for here.
Reading Recommendations
Ian Frazier’s “The Plushbottoms of Teton County” in the New York Review of Books is an eye-opening review of Justin Farrell’s Billionaire Wilderness: The Ultra-Wealthy and the Remaking of the American West, an ethnography of the ultra-wealthy residents of America’s richest county. (The book itself might be skippable since Frazier suggests the author “begins to identify with his captors.”)
To restate the book’s main point and revelation: Teton County, Wyoming, in the northwest corner of that rectangular state, remote from either coast, is the richest and most unequal county in America. Almost no one knows this, as I’ve discovered by just randomly asking around. Everybody guesses that enclaves like suburban Washington, D.C., or New York County (Manhattan), or Silicon Valley are the richest. The average income for the top one percent in Teton County is $28.2 million a year, by far the highest of all the 3,114 counties in the United States. The top one percent of Teton County residents make 233 times more per year than the bottom 99 percent. As for the top .01 percent in Wyoming, their average annual income is $368,823,036 (Connecticut is second at $83.9 million, and New York third at $69.9 million). . . .
The best news that Billionaire Wilderness brings is that people on both sides of the country’s economic divide know that things are out of whack. On the part of the very rich of Teton County, whose psyches Farrell looks into with such painstaking and commendable thoroughness, there seems to be a dawning awareness that all is not right with them. They come to Wyoming for the tax breaks; but they also want to be seen as “normal,” and for nonrich people to like them and be their friends. Maybe that’s why they in large part vote Democratic. It’s a start. Next, maybe the idea of taxing extreme wealth at two or three cents on the dollar can be proposed without causing terrified cries of “socialism!”
Gradual withdrawal from money-addiction is possible. Teton County can serve as a halfway house in which the very rich gradually wean themselves off it. The boldest among them might even begin by cutting the maintenance dosage in half. The .01 percent, instead of needing their annual $368,823,036, would try to get by on $184,411,518. Eventually they might taper off even further. At one point in the book, the author—who likes italics—asks, “What makes a good community in the twenty-first century?” Love and hope motivate the question. In the heart of America, beautiful Teton County is nowhere near a healthy or good community yet.
There’s an extraordinary article in The Atlantic by Michael Mechanic, “The Research Proves It: There’s No Such Thing as Noblesse Oblige”:
a large body of social science [has found] that people of higher socioeconomic status, compared with those lower down the ladder, are more prone to entitlement and narcissistic behavior. Wealthier subjects also tend to be more self-oriented and more willing to behave unethically in their own self-interest (to lie during negotiations, say, or to steal from an employer). In one study, Piff and his colleagues stationed a pedestrian at the edge of a busy crosswalk and watched to see which cars would let the person cross. Suffice it to say that Fords and Subarus were far more likely to stop than Mercedeses and BMWs.
Wealthy people are less likely than poor ones, in lab settings at least, to relate to the suffering of others. When people experience compassion, it turns out, our hearts actually slow down. In 2012, Piff’s then-colleagues Michael Kraus and Jennifer Stellar hooked volunteers up to ECG machines and showed them two short videos: a “neutral” video of a woman explaining how to construct a patio wall and a “compassion” video of children receiving chemotherapy treatments for cancer. Relative to the wealthier participants, the poorer ones not only reported feeling greater compassion for the kids but also exhibited a significantly larger slowdown in heart rate from one video to the next.
If affluent people are less moved by the suffering of others, they should be less likely to help those in need, and this too seems to be true both in the lab and outside it. While wealthy families donate significantly more money to charity on average than poor families do, they tend to give away a smaller share of their income. “As wealth goes up, the stinginess seems to increase,” Piff said. . . .
Successful people tend to feel deserving of their lot. As a corollary, they tend to view less-fortunate people as having earned their lack of success. “So you’re more likely to make sense of inequality,” Piff explained, “to justify it, make inequality seem equitable.”
The psychologists Kraus and Keltner have found that people who rank themselves at the top of the social scale are significantly more likely to endorse essentialism, the notion that group characteristics are immutable and biologically determined—precisely the sort of beliefs used to justify the mistreatment of low-status groups such as immigrants and ethnic minorities. Countless studies, Kraus writes, point to an upper-class tendency toward “self-preservation.” That is, people who view themselves as superior in education, occupation, and assets are inclined to protect their group’s status at the expense of groups they deem less deserving: “These findings should call into question any beliefs in noblesse oblige—elevated rank does not appear to obligate wealthy individuals to do good for the benefit of society.”
Turns out those very rich people are very skilled at evading taxes. A new study by two IRS researchers and three academics points to the enormity of the problem. From Bloomberg Wealth:
More than 20% of the wealthiest Americans’ income isn’t being reported to the Internal Revenue Service, according to a new study that calculates U.S. tax evasion is far higher than previously estimated.
Random audits of the rich can detect some tax evasion, but the study’s authors found that the IRS easily misses income hidden in sophisticated ways, including in private businesses and offshore structures. Collecting all unpaid income tax from the top 1% would boost revenue to the U.S. Treasury by $175 billion a year.
“We stress that our estimates are likely to be conservative with regard to the overall amount of evasion at the top,” the authors wrote. . .
IRS Commissioner Chuck Rettig told a House panel last week that audit rates for high-income taxpayers have tumbled in the past decade because the IRS has lost key staff that would examine the returns of wealthy individuals.
“Since 2010, we have lost 15,000 enforcement personnel,” he said.
The top 1% saw their net worth rise by about $4 trillion in 2020, capturing more than a third of all new wealth, according to data from the Federal Reserve released on Friday. Meanwhile, the net worth of the poorest half of U.S. households rose $471 billion, just 4% of last year’s overall gain.
This story prompted Harry to dust off and re-upload Super-Rich Tax Cheats, a short documentary he made back in 2008 with Nick Penniman and Lagan Sebert. Spurred by the revelations of a whistleblower, the video focused on a bi-partisan Senate investigation led by Sen. Carl Levin (D-MI) and Sen. Norm Coleman (R-MN) into tax evasion schemes by the very wealthy, at that time estimated to cost the American people $100 billion each year. Levin likened it to “economic warfare against the United States.” Based on the whistleblower's revelations, the Senate Committee on Investigations summoned two plutocrats to testify: toy magnate Steven Greenfield and Westfield shopping mall heir Peter Lowy, who received a blustery legal defense from Robert Bennet, the brother of Bill Bennett and the attorney who had defended Bill Clinton in the Lewinsky case. The facts in the video may be dated, but it remains a good primer on an issue that deserves renewed attention. In the years since the case against Lowy appears to have fizzled, and in 2016 the Second Circuit sided with Greenfield. With an IRS and an administration determined to enforce our tax laws, The Platypus is confident that the U.S. could stop wealthy criminals from robbing the American people of money we so sorely needed to recover from the pandemic recession.
And the federal government’s enforcement priorities are radically skewed not only in underenforcement of tax collection but in a range of other areas as well, as Alex Hertel-Fernandez and Deepak argued in Democracy Journal and illustrated in the dramatic chart below. (Tip of the bill to Harry for work on the data!) Basically, our government under both Democratic and Republican administrations has decided that criminalizing Black and immigrant communities is a FAR greater priority than protecting workers or civil rights. What would our society and culture look like if we reversed those enforcement priorities?
We found this report by Samir Sonti “Lifting the Curtain on Private Equity,” which he wrote for the American Federation of Teachers and Americans for Financial Reform, to be very helpful in understanding how the financialization of the economy is a crucial mechanism for corporate predation and fuels the dramatic rise of wealth inequality in this country. Moreover
This report makes clear that private equity performance as a whole has hardly been as impressive as the industry has claimed, and that it has worsened in recent years. Key indicators also suggest that there is a significant risk that overall private equity performance will deteriorate further in coming years. Additionally, this report sheds light on the significant risks associated with achieving even these mediocre returns. These include risks directly related to the investment management relationship as well as indirect risks resulting from private equity business practices and structural trends in the investment landscape.
Savvy Corner
We’re super-excited to tune into a conference “Working Class New York Revisited: The Past and the Future of Struggles for Progressive Change” on Friday, April 23rd. The program is hosted by the School of Labor and Urban Studies at CUNY and revisits the themes of historian Joshua B. Freeman’s classic Working-Class New York: Life and Labor Since World War II.
On April 27th, the Carnegie Corporation of NY, JPB Foundation, and Open Society Foundations will host a book launch featuring Amaha Kassa, Cecilia Muñoz, Mae Ngai, Ruth Milkman, and Deepak. Register here. Registration is free.
On April 28th, Georgetown University’s Kalmanowitz Institute will host a book launch featuring Ruth Milkman, Saket Soni, Marielena Hincapie, and Amaha Kassa. Register here. Registration is free.
You can find out more about the book and watch some short trailers from various authors here.
Delights and Provocations
You heard The Platypus implore you to watch “Small Axe” – the series of five films by Steve McQueen about the rich lives and courageous struggles of Black Caribbean immigrants in the U.K. We implore you again! And there’s this extraordinary piece by Gary Younge, “What the Hell Can I Call Myself Except British?”, about Small Axe that is itself a wonder, using as a touchstone the infamous Windrush scandal, the persecution of Black British immigrants by conservative governments for political purposes.
That, in no small part, is why the Windrush Scandal, in which the government sought so cavalierly to eject that small cohort of Black Britons who straddled the two camps (born in the Caribbean but raised from childhood in Britain), struck so deeply. It revealed that the length of time you had been in the country, the amount you had contributed, the life you had made, the taxes you had paid, the children you had borne or fathered, and the relationships you had built could still count for nothing against an intransigent, racist bureaucracy. When Amelia Gentleman asked Paulette Wilson if she felt British, Wilson replied, “I don’t feel British. I am British. I’ve been raised here, all I know is Britain. What the hell can I call myself except British? I’m still angry that I have to prove it.
Harry and Deepak have been transfixed by Schitt’s Creek, the Netflix comedy about an appalling family of super-rich people who lose everything and end up living in a motel in small-town America. Part of the cultural appeal of the show is the frisson of seeing a dramatic fall through the class hierarchy unfold. What keeps you is the dawning realization that the family members become better, more interesting people when they have no money. The family is rehabilitated into ordinary codes of decency by the non-rich people they mix with. It’s like watching wild, dangerous animals being tamed and socialized. Great wealth often erodes character (see The Atlantic article above), and particularly empathy. The show points to the conclusion that maybe even the rich would be better off – happier even – without all that money. (We’re not counting on most of them to see it that way!)