Living High on the Hog — the Feral 1%

Amid the hoopla and media frenzy surrounding these exciting “occupy” social movements the question arises — how feral is the top 1%? How is it that the hyper-wealthy Americans have gotten so very much richer since 1970, and no one in our social democracy has protested until now, in the jobless aftermath of the Great Recession of 2008? A deeper question is why did it take so long for this “American Spring” movement to launch itself?

A dictionary definition of feral reads “having reverted to the wild state, as from domestication”. I would liken the term “wild state” to a libertarian economist’s dreamy vision of an early “classic” capitalist economy with almost no taxes, no financial regulations, and paltry government services. The libertarian ideologues from the Cato Institute would accept only “the watchman state” where the government simply pays for an army, police, public transportation, and some public health.

The economics editor of the British newspaper The Guardian recently wrote that you have to go back over 80 years to find another English decade like this one when living standards failed to rise over a 10-year period. Here in America you have to go back over 50 years. He adds, “It is worth reminding ourselves at this point that those people at the very top — those complaining about the injustice of the [British] 50% tax rate — have had more than three decades of living high on the hog.”

I am reminding us that our American tax rates are far below this 50% rate about which the parastic British hyper-wealthy whine so loudly. Bush gave the American hyper-rich a massive tax cut in 2002 even while they supported his waging ruinously expensive and idiotic military adventures he conjured up out of the 9/11 tragedy. The hyper-wealthy reveled in this and their slogan might be, “all in it together — until the rich want out.”

The Gini coefficient is an international yardstick used to measure the “inequality index” in a country. As historian Tony Judt has shown in his book Ill Fares The Land, economic inequality in the USA was much less between 1945 – 1970 (meaning money poured into the middle), but began to get much worse from 1970 – 2007. Sometimes clichés make sense: the rich got richer after 1970, and the poor got much poorer and the middle class also lost buying power. In a sea of overpowering statistics of which many readers are aware, here is just one: in 2007 the top 1% of Americans earned 21% of the national income, and they owned a ginormous 35% of this country’s total wealth, figures far higher than in 1970.

Given this startling and growing wealth inequality between Americans, the hyper-wealthy class’s categorical refusal to accept any tax increase has caused the outrage leading to the burgeoning “occupy” movement. The plutocratic Republicans in the House and Senate, who simply serve as bought mouthpieces for the hyper-wealthy, have already won their campaign to stop the Joint Congressional Deficit Reduction Committee from making any formulations involving revenue increases (taxes). It is well-known that almost all of our Congressional representatives belong to the elite 1%, and that concealed crony capitalism serves this elite (think Abramoff).

We need the special “Buffet” tax on the super-wealthy, a windfall-profits tax on big oil (we have done such a tax before), Obama’s jobs bill, and some kind of cap on the top end of federal entitlements. McConnell, Cantor, and the other Republican crony capitalists working for the feral rich will honor their unholy “no tax increase ever” pledge to a private individual, Grover Norquist, over their sacrosanct loyalty oath to the U.S. Constitution and the prosperity of American working people. The poverty level in the USA has risen to 15.1% — neither wealth nor jobs have been “trickling down” to the majority.

Of course our economy requires banks, but in effect the banks have socialized risk but privatized profits, and they refuse to pay higher taxes on their profits as they reward themselves with sickening bonuses. The conservative former editor of UK’s The Daily Telegraph (Charles Moore) wrote honestly that, “It turns out — as the left always claims — that a system purporting to advance the many has been perverted in order to enrich the few.” While Karl Marx’s predictions about the future were way off, his analysis of mid-19^th century capitalism with its horrendous abuses was spot on: without social legislation benefiting the majority of citizens and protecting them from the hyper wealthy the gap between rich and poor, and hyper rich and the middle class, will widen dramatically (this is what the Gini coefficient shows).

Many of the hyper wealthy, the 1%, are indeed ‘feral’ because they want to revert to unfettered “wild” capitalism of the 19^th century. They enjoy flaunting their insanely increasing wealth — just look to the profligate existence of Frank McCourt, the bankrupt owner of the L.A. Dodgers who has siphoned off over $189 million for his sybaritic lifestyle (since 2004). The hyper wealthy 1% truly are un-American because they do not accept restoration of their original 39% tax rates of 2001, AND they refuse to pay up for imperialistic wars they supported that have failed. The restoration alone, which is NOT a tax increase, would help alleviate the national debt, along with a wealth tax that should extend down to the $400,000 range (not Obama’s too-high one million dollars). Of course, some reduction in Medicare costs is inevitable.

It may be that the major question facing middle-class voters is whether they trust Wall Street OR the government to provide jobs and reduce wealth inequalities. In 1912 that great Republican president Theodore Roosevelt, when the hyper-wealthy truly loved their country, stated the goal of his new “Progressive Party” this way: “to destroy this invisible government, to dissolve the unholy alliance between corrupt business and corrupt politics is the first task of the day.”

One hundred years later, the 99% realizes this task still stands before us and we now begin to confront the feral 1% and their libertarian ideologues on the streets.

The feral hyper-wealthy Americans

After three September 2011 weeks in Europe, reveling in the relative openness of the liberal press here, which has refused to wallow in the homeland’s over-the-top 9/11 frenzy, gives a traveling American a much different perspective on the economic messes in Europe and especially in the USA homeland itself.

A September 10^th Guardian column re-quotes the conservative former editor of The Daily Telegraph (Charles Moore) who writes honestly that, “It turns out — as the left always claims — that a system purporting to advance the many has been perverted in order to enrich the few.”

Another Guardian writer, economics editor Larry Elliott, wrote on Sept. 13^ththat you have to go back over 80 years to find another English decade like this one when living standards failed to rise over a 10-year period. Elliott adds, “It is worth reminding ourselves at this point that those people at the very top — those complaining about the injustice of the [British] 50% tax rate — have had more than three decades of living high on the hog.” Let’s remind our American selves that our tax rates are far below this 50% rate about which the parastic British hyper-wealthy whine so loudly. Bush gave the hyper-rich a massive tax cut in 2002 even while waging ruinously expensive and idiotic military adventures he hid beneath the 9/11tragedy. Economist Elliott’s revealing title: “All in it together — until the rich want out.”

A Reuters’ “Breakingviews” piece appearing in the Sept. 14 issue of the International Herald Tribune makes the point, one Americans should be thinking of amid our own financial woes, that a wealth tax for the richest 10% would “do the trick for Italy.” Hugo Dixon shows how a one-time 10% tax on the wealthiest Italians would raise 400 million euros and “cut national debt from 120% of GDP to below 100% of GDP.” Much of Italy’s crushing debt problem would be resolved, and this would significantly reverse the broader euro crisis in Europe, a looming catastrophe certain to impact the feeble US recovery. Dixon writes, “The Italians are so wealthy, they could afford it.” Some Italian hyper-wealthy, a la Warren Buffet, like this seemingly crazy idea since such a resolution of Italy’s debt problem would change the market psychology, and equity and bond prices would likely rebound. Investors losing on the wealthy tax increase could gain more on market savings than they lose on the special tax on the hyper-wealthy.

Another Sept 14 International Herald Tribune article by J. Calmes and B. Appelbaum, titled ‘Drums start to roll for stimulus,’ reviews growing support for Obama’s $447 billion jobs bill, but notes the surge is only for certain parts of his massive effort to help average and poor American workers. Whereas Congressional Republicans at first expressed openness to the jobs plan, this support, that many of us felt was politically expedient anyway, has turned sour when on Monday (9/12) the President proposed to offset the jobs bill’s short-term costs “with future tax increases on wealthy tax-payers.” This has become his important “millionaires’ tax” proposal, following the Buffett Rule.

Independent forecasters like Moody’s Analytics and Macroeconomic Advisers, quoted by Calmes and Appelbaum, assert that Congressional approval of Obama’s plan will spur US growth and get unemployment down: Moody’s believes it would add 1.9 million jobs.

However, the plutocratic Republicans in the House and Senate who simply serve as mouthpieces for the hyper-wealthy, have already begun their campaign to stop Obama’s plan. Oh, they’ll loudly vote for minor portions of the bill, but key elements, especially the special tax on the super-wealthy, including a windfall profits tax on big oil (we have done such a tax before) and closing other loopholes will pass over their foaming dead bodies. McConnell, Cantor, and the other crony capitalists working for the feral rich will honor their unholy “no tax increase ever” sacrosanct pledge to a private individual, Grover Norquist, over their loyalty oath to the U.S. Constitution and over the prosperity of American working people. The poverty level in the USA is at 15.1%, neither wealth nor jobs have been “trickling down” to the majority.

Ah, these hyper-wealthy Americans have indeed been “living high on the hog” since 1970, when the inequality between Americans began to grow tremendously (using the international yardstick, the Gini coefficient) — they vociferously supported Bush/Cheney’s insane military adventures believing they would gain access to cheap oil, but also having no intentions of paying increased taxes to fund these expensive catastrophes. They are feral, and un-American, because they do not accept restoration of their original 39% tax rates of 2001 AND they refuse to pay up for imperialistic wars that have failed. The restoration alone would help alleviate the national debt, and some reduction in Medicare costs is inevitable.

It may be that the major question facing middle-class voters is whether they trust Wall Street and business OR the government to provide jobs and reduce wealth inequalities. The rich have been getting much richer in the USA since 1970 (see Tony Judt’s Ill Fares the Land), and while the top 1% of Americans earned 21% of the national income, they owned a ginormous 35% of the country’s total wealth (for 2006-07).

That great Republican president Theodore Roosevelt stated the goal of his new “Progressive Party” this way: “to destroy this invisible government, to dissolve the unholy alliance between corrupt business and corrupt politics is the first task of the day.” [1912]

The true puzzle in all this is two-fold: the supine and gutless American journalists who have failed to research and disseminate how unpatriotic our wealthy have been; and the sleepy, strategically ignorant American masses who won’t use the internet’s resources to figure this travesty out for themselves.