Home > income inequality, Plutonomy > Take down letter from Citigroup

Take down letter from Citigroup

from John Schmitt

I’ve just received my second Digital Millenium Copyright Act take-down letter. As before, the letter is from the Kilpatrick Townsend, Attorneys At Law, and, as before, the letter is on behalf of their client, Citigroup.

This time, Kilpatrick Townsend has asked me to remove a copy of a Citigroup research report on “plutonomy” that was featured in Michael Moore’s documentary “Capitalism: A Love Story.” I wrote a post on the report in October 2009 (scroll down, this is from before I started using permalinks on the old version of my blog) and included a link to a pdf version of the document, which I had also uploaded on to my own site.

As before, I will comply with their request. But, I will also point out how absurd this whole process is. To start with, a quick Google search will show that the file remains widely available on the internet. Citigroup is trying to empty the sea with a bucket. Of course, that Sisyphean task is practically the whole point for the law offices of Kilpatrick Townsend. I imagine that they have a team of trained Googlers, who bill by the hour to hunt down unauthorized copies of Citigroup research documents. When they find a document, which can’t take long because I just found several, the firm sends out a take-down letter, written by lawyers who bill by the hour. And when the firm gets really lucky, a blogger or an ISP fights back, and then Kilpatrick Townsend gets to spend more billable hours squabbling with somebody on the internets who is unhappy about something.

Below is  my original plutonomy post –minus the link to the Citigroup memo, of course. 


The plane I’m on right now has free WiFi, so I can’t resist a quick post with a link to the Citigroup memo [LINK REMOVED AT CITIGROUP’S REQUEST] on the “Plutonomy”, featured in Michael Moore’s new movie “Capitalism: A Love Story”.

The report, from October 2005, is remarkable for its open exuberance about high and rising inequality in the United States. At least it gets the facts right:

…the world is dividing into two blocs – the plutonomies, where economic growth is powered by and largely consumed by the wealthy few, and the rest. Plutonomies have occurred before in sixteenth century Spain, in seventeenth century Holland, the Gilded Age and the Roaring Twenties in the U.S.

…the top 1% of households in the U.S., (about 1 million households) accounted for about 20% of overall U.S. income in 2000, slightly smaller than the share of income of the bottom 60% of households put together. That’s about 1 million households compared with 60 million households, both with similar slices of the income pie! …the top 1% of households also account for 33% of net worth, greater than the bottom 90% of households put together. It gets better (or worse, depending on your political stripe) – the top 1% of households account for 40% of financial net worth, more than the bottom 95% of households put together. This is data for 2000… Since 2000 was the peak year in equities, and the top 1% of households have a lot more equities in their net worth than the rest of the population who tend to have more real estate, these data might exaggerate the U.S. plutonomy a wee bit.

Citigroup even gets a key point that eludes most people, whose time horizon is heavily skewed toward the last 30 years:

Was the U.S. always a plutonomy – powered by the wealthy, who aggrandized larger chunks of the economy to themselves? Not really.

And the text follows with a good discussion of how economic inequality was on the decline in the United States for most of the 20th century.

The Citigroup analysts, however, did get one thing spectacularly wrong. They argued that talk of economic stability and financial fragility misunderstood the dynamics of the new plutonomy.

“Most ‘Global Imbalances’ (high current account deficits and low savings rates, high consumer debt levels in the Anglo-Saxon world, etc) that continue to (unprofitably) preoccupy the world’s intelligentsia look a lot less threatening when examined through the prism of plutonomy.”


  1. Bruce E. Woych
    November 8, 2011 at 4:11 pm

    Imagine that! Ashamed of their own thinking. And all the time we thought they weren’t real humans but reptiles in human skin. We can just imagine history written by people who keep two sets of (history) books!

  2. November 8, 2011 at 4:35 pm

    re history. Looking back beyond the 1940s its clear that the plutocrats were in charge from the founding of the USA since the constitution was designed, as Madison said, to ´Protect the opulent´´aganst the rest. The 1940s- 1970s were a temporary departure from the norms taht the opulent expect = a plutonomy.

  3. November 8, 2011 at 4:56 pm

    Currently in Wikipedia there is a page for “Plutocracy”. I advise to build between those well informed scientist that read this blog ) a page for “Plutonomy” explaining the concept and its history. Lets see how Citigroup tackles an institution like Wikipedia. The concept is out of the bottle, it will be impossible to put it back in.

  4. November 8, 2011 at 5:01 pm

    By the way, I forgot to add that the Real-World Economics Review Blog can be read in e-book devices thanks to a kind reader that uploaded a specific recipe for this purpose to the Calibre database. So for those of you that have Kindle, Nook and other devices, you can find the recipe in any new version of Calibre, and set it up to receive the RWER Blog and the comments to the articles every day or whenever you want it. It is an excellent way to read the blog and comments.

    • merijnknibbe
      November 9, 2011 at 4:31 pm

      How are the graphs doing on these devices? Do0 they need larger fontsize, whatever?

      • November 15, 2011 at 6:20 pm

        On Kindle they look OK when you zoom on them, if there is not too much text and only one graph per page or box. Still, e-books are black and white, so when you have many variables or countries represented the graphs tend to be confusing.

  5. Mark
    November 9, 2011 at 1:07 am

    Why not just link to a Google search for the document in question?

    Or find a kindred spirit in another country who will create blog entries on their own site, linking to these sorts of documents. Then you just link to their blog entries.

  6. November 9, 2011 at 3:47 pm

    Pablo, I can’t afford a Kindle or a Nook.

    • November 15, 2011 at 6:23 pm

      Sorry to hear that (they are like USD 80 for the cheapest of them). I heard a rumor however that Amazon could give some add-based model for free in 2012. We´ll see.

  7. Lucy L. Honeychurch
    November 10, 2011 at 9:57 pm

    I’m sure the poor Analysts who wrote this report were first hailed/promoted, then ostracized, then put on probation for some imaginary offense (insubordination, tardiness, or some such), then fired.

    That’s how it goes at Shiti – dare to speak an ounce of truth within those halls and you better be prepared to pay the consequences.

    No wonder their stock continues in the crapper – even the institutional investors (who gulp the Wall St. Kool-Aid by the gallon) know what a dysfunctional place it is.

    C’s senior management exists in their own small confidence bubble, and the only ones they’re foolin’ with their spin, is themselves.

  8. November 28, 2011 at 4:17 am

    Aren’t US taxpayers already committed to backstopping up to 300 billion of C debt. The horses have already left the barn.

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