I never liked the saying: “We are the 99%.” While admittedly catchy and effective as a slogan, I think it is ultimately divisive and counterproductive. The reason I say this is because the statement itself alienates much needed allies for no good reason.
In a country with a population of 320 million, the 1% represents 3.2 million people, which is a pretty big number. While the 1% certainly have far superior material lives compared to the 99%, that doesn’t mean a particularly large percentage of them are thieves, cronies or oligarchs. In fact, it behooves people interested in transitioning to another paradigm to court as many of them as possible to the cause. It is very useful to have well meaning people with resources and connections on your side. To blithely assume there aren’t plenty of potential allies from a pool of 3.2 million is committing strategic suicide.
– From the post: Charting the American Oligarchy – How 0.01% of the Population Contributes 42% of All Campaign Cash
Much of my focus throughout 2015 was on the pernicious influence of the 0.01%, i.e., the American oligarchy. Indeed, nothing would please oligarchs more than to define a struggle as the 99% vs. the 1% in order to shift attention away from the real root of the problem, themselves.
As I’ve mentioned time and time again, 99% of the 1% doesn’t bribe politicians, write tax laws, or influence U.S. foreign policy. To discover the real players, the people who drive American domestic and foreign policy, as well as make all of the important decisions, you only need to focus on a hand full of people.
Today, the New York Times published an important article that proves the point. Here are the key paragraphs in the entire lengthy article:
The impact on their own fortunes has been stark. Two decades ago, when Bill Clinton was elected president, the 400 highest-earning taxpayers in America paid nearly 27 percent of their income in federal taxes, according to I.R.S. data. By 2012, when President Obama was re-elected, that figure had fallen to less than 17 percent, which is just slightly more than the typical family making $100,000 annually, when payroll taxes are included for both groups.
From Mr. Obama’s inauguration through the end of 2012, federal income tax rates on individuals did not change (excluding payroll taxes). But the highest-earning one-thousandth of Americans went from paying an average of 20.9 percent to 17.6 percent. By contrast, the top 1 percent, excluding the very wealthy, went from paying just under 24 percent on average to just over that level.
This is merely a reflection of what I’ve been saying throughout the Obama Presidency. That he is nothing more than an oligarch-coddling puppet masquerading as a progressive.
As you can see, tax rates for the non-oligarch 1% actually went up during his Presidency, while oligarch tax rates declined substantially. This is precisely what Obama will be remembered for by history, bailing out and protecting the 0.01%, at the expense of everyone else.
We need to grow up and understand the battle lines clearly in order to win. It is demonstrably not the 99% vs. the 1%. In reality, it’s the oligarchy and the system it created vs. everyone else.
I suggest you read the entire article, but here are a few of the more compelling segments:
With inequality at its highest levels in nearly a century and public debate rising over whether the government should respond to it through higher taxes on the wealthy, the very richest Americans have financed a sophisticated and astonishingly effective apparatus for shielding their fortunes. Some call it the “income defense industry,” consisting of a high-priced phalanx of lawyers, estate planners, lobbyists and anti-tax activists who exploit and defend a dizzying array of tax maneuvers, virtually none of them available to taxpayers of more modest means.
In recent years, this apparatus has become one of the most powerful avenues of influence for wealthy Americans of all political stripes, including Mr. Loeb and Mr. Cohen, who give heavily to Republicans, and the liberal billionaire George Soros, who has called for higher levies on the rich while at the same time using tax loopholes to bolster his own fortune.
All are among a small group providing much of the early cash for the 2016 presidential campaign.
Operating largely out of public view — in tax court, through arcane legislative provisions and in private negotiations with the Internal Revenue Service — the wealthy have used their influence to steadily whittle away at the government’s ability to tax them. The effect has been to create a kind of private tax system, catering to only several thousand Americans.
The impact on their own fortunes has been stark. Two decades ago, when Bill Clinton was elected president, the 400 highest-earning taxpayers in America paid nearly 27 percent of their income in federal taxes, according to I.R.S. data. By 2012, when President Obama was re-elected, that figure had fallen to less than 17 percent, which is just slightly more than the typical family making $100,000 annually, when payroll taxes are included for both groups.
The ultra-wealthy “literally pay millions of dollars for these services,” said Jeffrey A. Winters, a political scientist at Northwestern University who studies economic elites, “and save in the tens or hundreds of millions in taxes.”
The wealthy can also avail themselves of a range of esoteric and customized tax deductions that go far beyond writing off a home office or dinner with a client. One aggressive strategy is to place income in a type of charitable trust, generating a deduction that offsets the income tax. The trust then purchases what’s known as a private placement life insurance policy, which invests the money on a tax-free basis, frequently in a number of hedge funds. The person’s heirs can inherit, also tax-free, whatever money is left after the trust pays out a percentage each year to charity, often a considerable sum.
Among tax lawyers and accountants, “the best and brightest get a high from figuring out how to do tricky little deals,” said Karen L. Hawkins, who until recently headed the I.R.S. office that oversees tax practitioners. “Frankly, it is almost beyond the intellectual and resource capacity of the Internal Revenue Service to catch.”
The combination of cost and complexity has had a profound effect, tax experts said. Whatever tax rates Congress sets, the actual rates paid by the ultra-wealthy tend to fall over time as they exploit their numerous advantages.
From Mr. Obama’s inauguration through the end of 2012, federal income tax rates on individuals did not change (excluding payroll taxes). But the highest-earning one-thousandth of Americans went from paying an average of 20.9 percent to 17.6 percent. By contrast, the top 1 percent, excluding the very wealthy, went from paying just under 24 percent on average to just over that level.
There you have it.
For related articles, see:
New Report from Princeton and Northwestern Proves It: The U.S. is an Oligarchy
Charting the American Oligarchy – How 0.01% of the Population Contributes 42% of All Campaign Cash
Former U.S. President Jimmy Carter Sounds Off on America – “It’s Just an Oligarchy”
In Liberty,
Michael Krieger
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Be sure to check out James Corbett’s latest on the oiligarchs: How Big Oil Conquered the World
https://www.corbettreport.com/episode-310-rise-of-the-oiligarchs/
Excellent point and article Michael…
So we have a “problem” created by government, and you want government to fix it. Hmmm.
I still am trying to figure out how my life improves if the oligarchs pay a 100% tax rate. The Soviet Union had 120% tax rates and it didn’t seem to help them.
Please show me specifically where I said I wanted government to fix it?
The crux of this article is that everyone else in society is subsidizing oligarchs. So when taxes are raised, or inflationary polices are implemented it is at the expense of the 99.99%, while the oligarchs are the only people protected and therefore unaffected.
“So when taxes are raised, or inflationary polices are implemented it is at the expense of the 99.99%”
And who, specifically, does this? Government. They create the problem, then offer to fix it. Quite a scam. All the while everyone gives up more of their freedoms thinking that the “problems” are being fixed.
Though I dislike many of the policies put forth by a certain previous President, he had one thing right: Government IS the problem.
You’re acting like I am some sort of big government advocate, when the entire thrust of this website has always been to expose how oligarchs own government and use it to abuse everyone else. Ie, oligarchy.
So is that the fault of the oligarchs or the government? Oligarchs are doing what virtually everyone (save a few righteously moral people) would do given the same circumstances. You could kill all the present oligarchs and within 10 years a new group would arise.
The government has a monopoly on force. The oligarchs can do nothing without being enabled by government. Oligarchs go to government because that’s where the power is. And that power is becoming more and more unlimited every day. To think that by taxing some group of people a little more, and others a little less will somehow even the playing field is unrealistic at best.
The only way to “fix” the oligarch problem is to fix the government problem. There is virtually no chance that is going to happen (short of war or revolution), so just get used to it.
Of course if government did not have so much power, we would have the option to leave and make a better life for ourselves. But every day they tighten the noose just a little bit more. Don’t want any of the serfs getting any wild ideas of freedom.
I don’t disagree with much of what you say. The key problem is excessive power, and oligarchs exercise their will via excessive government power.
Both government officials and oligarchs deserve to be called out, but unquestionably, an out of control government that has no allegiance to the Constitution is the core issue. The oligarchs like it that way though, let’s not pretend they don’t.
YES! But oligarchs are not special. They are you and me. Almost no one will give up an advantage they are given, even if it negatively affects others. When you have monopolistic force supporting you, why would you?
I wish people were different, but wishing does not make it so.
Well I did give up a very high paying job in a career I was very good at, and actually quite enjoyed, due to my inability to feel comfortable with the general ethics surrounding the financial system.
Just because most people would behave in a certain way, does not excuse the behavior.
Please don’t take this personally, but: did you give back the money that you made? Or at least that portion that you felt had been acquired unethically?
And yes, no excuses. Just reality. The problem with government is you have a small group of imperfect beings in charge of a large group of imperfect beings.
The only partially successful way to control government is to make it as small as possible. Smaller countries not run by a dictator generally have more freedom. Smaller countries do not have the resources to impose world wide slavery as the U.S. is doing now.
Hopefully we are in the final death throes of the U.S. empire. I would like to think we would learn from history, but likely another empire will arise and a new group of sociopaths will be in charge.
I actually never earned a dollar in a way I would deem unethical. I worked at research company Sanford C. Bernstein. Their entire business model is basically publishing deep dive research reports.
What made me leave is that I felt I was being compensated heavily merely because of the industry that I worked in, and that the work I was doing wasn’t societally valuable (though not unethical) and that I could have a bigger positive impact on the world by leaving and allocating my personal resources elsewhere.
If I had attained money unethically it’s possible I would have donated it. It’s also possible that I would not. I can’t honestly say.
I’m not asking oligarchs to give away their money, but I would ask them to shift those resources to protecting the U.S. Constitution. If they were on board with that effort, the battle would be far easier. My point is they are not doing this, they are largely just trying to turn 10 billion into 50 billion.
Again, I agree that concentrated power is the problem. Particularly when it is concentrated in government that can deprive you of liberty. I guess my point is the ultra wealthy could help the most in this fight, but instead are using the bloated government to consolidate their own wealth and power.
Your blog is on some seriously shitty servers…
Interesting story. Everyone looks at these things in a different way. I would say that if others are making a voluntary exchange with you for your services then no problem. Of course if you don’t think you are providing any value then you have to re-evaluate your services. As you did.
Even those with the greatest intensions get caught up in these questions. The founders of the country had some great ideas, but were not willing to give up the advantages they acquired through force (slavery). They were clearly the oligarchs of their time.
You don’t have to be ultra-wealthy to gain advantages using government. I get Social Security payments. Clearly this is using the force of government to compel others to give a portion of their earnings to me. Would I starve without it? Probably not. But I’m not likely to give up that advantage even though I know it’s wrong. I’m just as guilty as Warren Buffet for using the power of the state to compel others to act as I wish.
Truly a dilemma. I’m an oligarch. Just a poor one.
Elsewhere, you say “But oligarchs are not special. They are you and me.”
They are not like you and me (or at least, not like me). They are largely psychopaths. Psychopaths are attracted to power and money, and care only about themselves. They have little conscience. This describes the oligarchs pretty well. as well as their minions in Congress.
Being an oligarch is like being a prostitute. For the most part it’s only a matter of price.
Doug Casey likes to say that the Pareto Rule would have 80% of the people doing the right thing, while 4% (20% of 20%) of the people are the real problems. I think 80% is being generous.
Though perhaps not directly applicable (but it does give some idea of human behavior) the Milgram Experiment showed that something over 50% of the people instructed to hurt others will do it. They may complain. But they will do it. It’s why things like Nazi Germany can happen. It’s why police will steal from citizens and not think twice about it.
If you believe you are not attracted to money and power, perhaps you have never been put in a position to exercise power. Most people are never given the chance. We’d all like to think we would act like a saint, but something tells me it’s not true.
There is, of course, a middle ground. You accurately mentioned that the Founders did not give up their slaves, despite many of them having serious ethical reservations about the practice. This proves the true point, that almost no one will willing giving up their position or status easily.
That said, there is a difference between not being a saint (I agree this is true with respect to almost everyone) and being a total sick, unrestrained psychopath. While Washington did not free his slaves until his death, he returned to civilian life after serving two terms in office. As King George remarked:
Give the last word to Washington’s great adversary, King George III. The king asked his American painter, Benjamin West, what Washington would do after winning independence. West replied, “They say he will return to his farm.”
“If he does that,” the incredulous monarch said, “he will be the greatest man in the world
While it is undoubtably true that humans, all of us, are incredibly flawed, some are far more flawed than others. To compare today’s American oligarchs to our Founding Fathers in terms of courage, ethics, wisdom and intellect is in my view a serious error.
So then Washington proceeded to use the power of government to steal product and assets from the populace (Whiskey Rebellion). He might have been better than most, but he still had his moments of oligarchy. Just because he was an official member of the government does not change the nature of his actions.
Mike Krieger is trying to reason with psychopaths, for whom there’s nothing wrong with what the oligarchs are doing, because everyone is a psychopath (so the psychopaths here are alleging).
Psychopaths love libertarianism, because it ‘justifies’ their psychopathy: it alleges that there is no right and wrong, there is only profitable and unprofitable; there is only winning and losing — and the winners are the psychopaths.
To a psychopath, any complaining about what psychopaths do, or how they win, is sheer envy, from the losers.
Mike Krieger here is trying to reason with psychopaths, about conscience, of which they are proud to have none, except that to win is right, and that to lose is wrong.
Fine. Oligarchs are psychopaths. Whatever.
What are the government bureaucrats? No matter how psychopathic your oligarchs may be, they are powerless without Washington D.C.. I suppose the bureaucrats are just doing their job as public servants. There is no better example of sociopathic behavior than a bureaucrat: “I’m just following orders/laws/directives; I don’t care about the outcome”.
And as for right and wrong, who alleges there is no right and wrong? It certainly is not Libertarians. Wrong is clearly defined: aggression against your fellow man. Liberals have no such limitations. ‘Aggress against anyone who disagrees with you’ is the liberal mantra. As our dear leader said: bring a gun to knife fight. Or Chairman Mao: “Political power grows out of the barrel of a gun”
Until big government is seen for the murdering, psychopathic institution it is there will never be peace. 200 million victims of government in the 20th century is a record no oligarch can match.