The Super Powers of the Super-Rich

One of America's most enduring myths is that we are a classless society. Anyone with ambition, determination, intelligence and a bit of luck can become fabulously wealthy. Sometimes, it really happens that way -- or just often enough to keep the myth alive.

The persistence of that dream usually is enough to squelch any talk about class. No one wants to do anything that might harm the wealthy if one hopes to join their ranks someday. The reality is that virtually all of us are not going to become fabulously wealthy, or even moderately so. Even earning a solid middle-class income -- I define that as having a job that pays $30,000-$40,000 a year -- is now beyond the reach of many Americans.

Things have gotten so far out of whack that the definitions of ideas that most of us used to agree upon have changed. "Government" is now seen as evil and communistic, taxation "punishes success," welfare "fosters dependency" and affirmative action is "reverse discrimination." The "free market" no longer means a fair market, but an economy with absolutely no government protection against the most rapacious and powerful. "Greed" is now an essential virtue in business while "fairness," the cornerstone of a civilized society, is now considered a vice.

You definitely can't say these things in the mainstream media, because it only objects to class warfare when it waged from the bottom-up. The top-down war being waged against average Americans is supported as the triumph of free enterprise.

It's an undeniable fact that the few have been prospering at the expense of the many in America over the past couple of decades. Our nation has the most unequal distribution of wealth of any industrialized country in the world, with the top one percent controlling over 40 percent of America's total wealth.

Economist John Kenneth Galbraith has called this "the culture of contentment." Galbraith wrote that the contented class is "doing well, (but) many wish to do better. Having enough, many wish for more. Being comfortable, many raise vigorous objection to that which invades comfort."

These are the people who believe government is a burden, unless they are investors in a failed bank or savings and loan, work for a defense contractor, or get generous tax breaks and/or subsidies for their business. This is considered beneficial government spending by the contented class. Using their tax dollars for Social Security and Medicare for the elderly or welfare and Medicaid for the poor is considered wasteful and unnecessary government spending.

To the contented class, the wealthy are hard-working people blessed by God that are deserving of their good fortune. The poor are lazy, shiftless, dependent upon handouts and contribute nothing to society. Money given to the wealthy creates jobs. Money provided to the poor saps their moral fiber.

Americans are now working longer hours and producing more than at any time since World War II, but all the gains are going to their bosses. Economist Edward N. Wolff recently examined data gathered in federal surveys, and found that the wealthiest 20 percent in the U.S. received 99 percent of the total gains in the economy between 1983 and 1989. During that same period, the richest one percent picked up 62 percent of the new wealth that was created. From 1989 to 1992, that same group got 68 percent.

During the prosperous 1950s and '60s, the super-rich one percent held about a third of the total wealth and the highest federal tax bracket was 91 percent (lowered to 71 percent in 1962). Wolff found that the slowdown in growth in the U.S. economy that began in the 1970s was accompanied by a rising inequality in both income and wealth.

Basic steps toward diffusing wealth -- such as raising the minimum wage, expanding the earned income credit and providing health care and child support assistance to working families -- could easily be funded through cuts in defense spending and corporate welfare (the two biggest sacred cows in the federal budget) and the return of a truly progressive tax system that returns tax rates to where they were in the 1960s.

Unfortunately, that is unlikely to happen. The Republican-controlled Congress supports lower income and capital gains tax rates for the wealthy. They still cling to the notion of trickle down economics -- that cutting taxes on the rich will benefit everyone. The economic stats from the 1980s prove that cutting taxes on the rich benefits the rich only.

Now, it's more subtle. The wealthy can hire lobbyists to go to Washington to re-jigger the tax code or change government regulations to benefit their companies. Capital is now global, and corporations answer to no one. If you don't want to work for $5.15 an hour, they threaten, we'll take your job to Mexico or Indonesia. They no longer need Pinkertons to break strikes; they can legally hire strikebreakers and fire strikers.

This is not rhetoric. This is reality. The declining standard of living of the average American worker can not be blamed on welfare mothers, immigrants, environmentalists, government bureaucracy or the many other scapegoats that the Right uses to camouflage the upward redistribution of wealth.

It is the rich who continue to get richer and use a political system that they have fully bought and paid for to make sure things stay that way. They are the ones who want to eliminate social welfare programs and rewrite the law books so there are no limits to their profits. These are the people who are looting the country at our expense. This is class warfare, and if you are not wealthy, you are standing in the free fire zone.