Opinion

Chrystia Freeland

The political clout of the superrich

By Chrystia Freeland
March 1, 2013

Louis D. Brandeis, the American jurist, famously warned: “We may have democracy, or we may have wealth concentrated in the hands of a few, but we can’t have both.”

Brandeis’s cri de coeur was inspired by an indignant observation of the shenanigans of America’s robber barons during the Gilded Age. Today, we live in a data-driven age, and some careful students of the connection between money and politics have now amassed a powerful body of evidence to support Brandeis’s moral claim. A lot of it is assembled in a report by the progressive research organization Demos, published this week.

One of the most striking findings is the extent to which economic power translates into political power.

Institutionally, this is an era of unprecedented democracy – one of the triumphs of the 20th century has been the extension of voting rights to all adults in a lot of the world.

But even in the United States, the country that thinks of itself as being the world’s leading democracy, it turns out that those rights do not translate into much actual political power. David Callahan, co-author of “Stacked Deck,” the Demos report, describes the super-rich as “supercitizens, with an outsized footprint in the public square.”

“I think most Americans believe in the idea of political equality,” Callahan told me. “That idea is obviously corrupted when in 2012, one guy, Sheldon Adelson, can make more political donations than the residents of 12 states put together.”

The Demos study draws in part on the quantitative research of Martin Gilens, a professor of politics at Princeton University and author of “Affluence and Influence: Economic Inequality and Political Power in America.” Gilens, who focused on the divide between the top 10 percent and everyone else, found a high degree of what he calls political inequality.

“I looked at lots of survey data that indicated what people at different income levels wanted the government to do, and then I looked at what the government did,” Gilens explained.

“For people at the top 10 percent, you could predict what the government would do based on their preferences,” he said. “But when the preferences of people at lower income levels diverged from the affluent, that had no impact at all on the policies that were adopted. That was true not only for the poor but for the middle class as well.”

Gilens is a social scientist who is careful to stick to his data. But he told me he was “definitely surprised by the extent of the inequality.”

“If you value democracy, if you value the ability of people at all levels of income to shape government, which is what it means to be a democracy, then, yes, you should be very worried,” he said.

One reason this “political inequality” is significant is that it turns out the rich and the rest have different political preferences. These do not split easily along traditional partisan lines – in fact, one of Gilens’s findings is that political inequality persists whether Democrats or Republicans are in charge. And in certain areas, like defense policy, there is no class divide.

But on an important set of economic issues – deficit reduction, the minimum wage, free trade, regulation and progressive taxation – the affluent are more conservative than everyone else.

“None of this might matter if the wealthy and the rest of the public had the same public policy preferences,” Callahan said. “But as we document, the wealthy do have very different policy preferences, particularly in the sphere of economic and fiscal policy and on trade and globalization. You see this on issues like taxation, or the minimum wage, or the general role of the government in society.”

This gap in policy preferences, the Demos report argues, is the explanation for one of the most puzzling and worrying consequences of rising income inequality – its correlation with falling social mobility. Alan B. Krueger, the head of President Barack Obama’s Council of Economic Advisers, calls this the Great Gatsby Curve, and it is the most compelling reason to be worried about the growing chasm between the top and everyone else.

That link, which has best been documented by the Canadian economist Miles Corak, is mysterious. After all, a lot of today’s rising inequality has been driven by benign forces like the technology revolution and, as a result, today’s plutocrats are more likely to be self-made than they were three decades ago.

But once they become rich supercitizens, the Demos report argues, those at the top of the economic heap use their power to support policies that diminish social mobility. This is not because of malign intent – there is no cabal of fat cats in top hats smoking cigars and plotting how to keep the proletariat down. Indeed, education, a key to social mobility, is a stated priority for the affluent.

The catch comes when there is a choice between personal self-interest, often in the form of lower taxes, and the expensive institutions of greater social mobility. And that is when the supercitizens opt to pull up the opportunity ladder behind them.

Beyond the campus green, Americans can be squeamish about viewing policy choices through the prism of economic self-interest. It is much more comforting to imagine the country is engaged in a high-minded and technocratic debate about what works best to serve the common good.

But that’s not what’s happening. The supercitizens are very effectively pursuing their own self-interest. Social opportunity, and even democracy, are under threat as a result.

 

Comments
53 comments so far | RSS Comments RSS

One other thing about the way I write: in structural engineering there is a principal that all forces acting on a building must equal zero, or it is unstable and could even collapse.

If I wrote my propaganda series, pro and con, I would construct it such that all arguments equaled zero. If there is any change or progress forward, it has to come from outside the “system”, but it is more likely that one can count on mistaken calculations, or something barely noticed and overlooked. That can bring disaster too. You can do everything right and still lose and the roof can cave in.

Haven’t you noticed that any argument can have it’s opposite? I do it all the time. I learn a lot that way.

Is bipolar oscillation something human beings have to live with as a social rule? History is bipolar and so is the economic life of the world.

Or maybe it’s more like the action of the lungs?

Posted by paintcan | Report as abusive
 

@paintcan,

Any life fundamentally ruled by emotion will be merciless and brutal at times. Those who instead are able to think and act from a basis of logic are more likely to find life an “easier” set of experiences. For me logic is the “main course” with emotion added here and there as a “spice”. An “honest choice” wouldn’t you agree?

You and I have long debated the importance of “truth and facts”. Your “zero sum” structural engineering description appears an honest attempt to illustrate why “truth and facts” don’t matter. The incovenient reality is that there are few, if any “zero sum” situations in real life.

The effects of mass and gravity can be calculated and considered as dampening forces to mitigate some of the gust or earthquake forces of comparatively short duration that might act on a structure. Today the effects of fire on a structure, and how to best prevent or postpone structural collapse in such case must be considered.

Components for a land structure in a seismicly active area would be both different and more expensive than for the same structure in a geologically stable area. There would be differences as to “additional” support necessary if built on a rock or a sand “base”. A floating structure, such as a ship, might have more equal forces to consider from all directions.

So the “effective design zero” point is never an arbitrary mid-point between theoretical extremes but must be determined giving due consideration to all pertinent “truth and facts” to find the “best economic compromise”. Even aircraft structures are not designed to resist EQUAL potentially destructive forces from all directions. The end product is the result of many significant considerations and compromises.

Our logical conclusion is that “Truth and facts” are absolutely essential to any proper structural design process. It seems to me any writing that offers NO facts and NO truth, intentionally without discernible goal or lasting significance, can offer NO merit, satisfaction or reward to either author or reader.

I have read some poetry that is like this.

Posted by OneOfTheSheep | Report as abusive
 

@OneOfTheSheep

Talking with you is like talking with one of the indoctrinated. You are so locked into you’re world view you can not see reality.

***”Your educational history shows successive but unrelated academic pursuits changing with the frequency of a hooker’s escorts.”

Social Science, History, Law and Library (law library) all perfectly related – It’s just not there; unless your a Senator’s son. This is particularly true for a “new one” off the assembly line. The old ones can’t retire and there are too many (with experience) taking all the entry level jobs. There’s NO WORK.

NONE. It’s all a lie.

***”A relative of mine completed an advanced degree in Petroleum Engineering. … but noooo, … he wanted the “big bucks” right off,”

He’s an idiot. Graduating lawyers can’t even get doc-review jobs as even those are outsourced to India.

Also, the only industry growing is BIG OIL; at the expense of everyone else. I heard manufacturing is coming back to the US. Jobs for GE making water heaters at $30 an hour are now returning from China at $9 an hour, with no benefits. It’s a RAPE but I’d do it but I hate the fact I’m being raped; you don’t…you call that “business” – you and your ilk are SOCIOPATHS.

***” if you start with an idiot and educate him, the result is an educated idiot***

Right. ‘Nuff said. We must all be idiots. We’re NOT human right? We’re sub-human. There’s winners and LOSERS! and we’re just “the losers.” Correct? The idiots. Idiots deserve it. You’re just WINNING! Right? Like Charlie Sheen?

Even seen “Trading Places” with Eddie Murphy? You must really think you’re indestructible? That this can never happen to you. Or your son? Or daughter? You really don’t see other people around you as “human-beings?” Do you?

May you acquire empathy though life before you transcend.

***”Here’s a little secret. They don’t hire inexperienced people as “executives”.”

No they only hire WINNERS; just like you; and that’s why it’s all turning to SH*T.

I don’t have to argue with you. I don’t have to play your game. I don’t have to lift a finger. You may be in 1st class and me in steerage but when this ship fails; you’ll be pooping in the same red bio-hazard bags. If anything, I might just pity you; I’ll pass first – but I sure as hell won’t want to live / linger on in your coming MAD MAX world.

Cheers!

Posted by Foxdrake_360 | Report as abusive
 

Post Your Comment

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
  •