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Plutocracy?

from Peter Radford

Seriously though.

The 2012 Page, Bartels, and Seawright paper makes interesting reading. I came across it via the Krugman blog and recommend it to you all.

The key is that this is a first small attempt to quantify the difference in perspective between the ‘wealthy’ and the ‘general public’. The paper is thus an important step along the way towards understanding why it is that so  much of our political discourse seems totally blind to the reality as experienced by the vast majority of our citizens.

If, like me, you have come to believe that our policy makers have a narrow focus and that their focus overlaps more with that of the wealthy and/or big business than it does with ordinary folk, then this paper is a start to getting empirical support for that feeling.

The paper’s concluding paragraph is worth quoting in full:

“Even without being able to gauge the actual political power of wealthy citizens, we can confidently reject the view that extensive political power by the wealthy would be of little practical importance anyway because their political preferences are much the same as everyone else’s. On many important issues the preferences of the wealthy appear to differ markedly from those of the general public. Thus, if policy makers do weigh citizens’ policy preferences differentially based on their income or wealth, the result will not only significantly violate democratic ideals of political equality, but will also affect the substantive contours of American public policy.”

This is the point: the ability of wealth to affect policy, substantially increased by recent trends and legal decisions, is subverting the very foundation of America’s self-image and self-justification. It is no longer a democracy, or is nearly so, and is rapidly declining into plutocracy.

Whether we have reached the end of this decline or are only partially along the way is of major concern. The outcome is grim. It implies the end of the middle class as a concrete social reality and the emergence or reinforcement of a more highly stratified class system that will block progressive political action and the possibility of the majority sharing in the fruits of society’s advance.

On a related note:

Libertarian economists seem able to ignore the profoundly destabilizing outcomes of the so-called liberalism they espouse. Their willingness and ability to separate theories of economics from theories of society as a whole is breathtakingly narrow-minded. It is left, unfortunately, to people in other social sciences to keep the word ‘social’ alive with any semblance of meaning or relation to reality.

I think any student seriously interested in studying society ought steer clear of most economics until they have a good and firm understanding of its contingent nature. Above all they need to understand the ambivalence of economic theory, its axiomatic limitations, and its inability to cohere into any broad application. They ought never leave an economics class thinking they have acquired an incontrovertible body of knowledge. And they always ought to put what they have just been taught within a the broader based context provided by other social sciences.

That way when they act as workers, managers, and voters they can look on economics with the skepticism it deserves. They can think of it as one methodology amongst many. For economics has become not much more than a method. Moreover it is a method with an ideological twist.

Hence its complicity in the emergence of plutocracy.

 


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  1. BC
    September 2, 2015 at 4:47 pm

    The US is an empire, i.e., Anglo-American empire.

    The basis of dominant US law is commercial law (and imperial maritime law).

    Corporations are people under the US Constitution. Corporations have privilege under commercial law and the US Constitution that organic persons do not have.

    Therefore, the owners of the largest US corporations have disproportionate legal standing, privilege, and power to influence laws/rules.

    That the largest corporations operate globally, their interests have become increasingly “supranational” in scope, requiring global sources of resources, labor, and markets, as well as cooperation (co-opting) of international leaders to achieve their business objectives.

    Increasingly the largest firms’ business is financial, including large banks, non-bank financial conglomerates, and financialized operations of non-financial firms. Thus, trade agreements preferentially accommodate large firms’ financial requirements over local and national interests.

    Had the gov’t and Fed not borrowed and printed trillions of dollars in 2009-14, the largest commercial US and foreign banks in the US would have collapsed and been liquidated. The bailout of the banks to permit them to continue to conduct their hedge fund-like activities is a form of socialism, i.e., rentier socialism.

    Given the economic and financial stakes of such large, far-flung enterprises and the colossal share of the world’s resources required to sustain the international operations, these firms require assurance of security to protect vital resource supplies, shipping lanes, and ensure friendly leaders are in place abroad. A large, global military force and supporting superstructure is required.

    Thus, the largest corporations’ operations have become increasingly international and financial, i.e., imperial and rentier, and dependent upon a large international military force, i.e., militarist, resulting in what might be described as a militarist-imperialist, rentier corporate-state.

    The plutocracy is not emergent; it has existed in evolving form and membership since as long ago as the 1820s-30s. The plutocratic caste members are largely internationalists and thus hold no particular self-identification or allegiance to a nation-state or to “the people”/the masses and their needs and concerns. They receive income overwhelmingly disproportionately from rentier sources, not from productive activities.

    Summarizing, the US is a militarist-imperialist, rentier-socialist corporate-state owned by the rentier-plutocrat Power Elite top 0.001%, who are internationalists with little or no self-identification or allegiance to the US nation-state nor any sense of obligation to the mass population’s interests and needs.

    Finally, economics is politics. War is the extension of politics with other means. War is the business of empire, and war is good business for imperialists.

    Therefore, economics is politics is war with other means as a rationalization for the imperial corporate-state’s expansion of territory, expropriation of resources and labor for profit, co-opting of foreign leaders, and often genocide and ecocide in the process.

    The national US polity has next to no ability whatsoever to influence elected officials beholding to the owners of the Anglo-American, militarist-imperialist corporate-state.

  2. September 2, 2015 at 8:38 pm

    Gilens and Page, of Princeton and Northwestern, released their multivariate analysis on this subject in April, 2014.

    see http://zerowastenews.org/Archive/Gilens-and-Page-3-9-14.pdf

  3. September 3, 2015 at 4:04 pm

    The most effective step in halting destructive consequences of war used as an “acceptable” strategy/tactic in business competition is United Nations reform requiring each UN member state sign on to the Rome Statute, International Criminal Court, or face expulsion from the international organization.

  4. September 4, 2015 at 10:15 am

    Although wealth influencing politics is a problem, the much bigger problem is the privatisation of public life. For democracy to be effective, the state needs to be in control of things that the public can then decide on. If the state controls almost nothing because education, healthcare, transport, research, pensions, security, cities, etc. have become private concerns, you can have a very democratic process that rules over nothing.

    Democracy is not about making technical rules at the margin of private interest. Democracy has been about determining what is or isn’t private interest and sometimes changing that allocation. Democracy should be capable of changing the boundaries of property, for example by nationalising banks or providing free healthcare and education.

    Democracy is meaningful if it controls things that matter, including things that have value and cost. It’s not about regulating the thin space around the edges of the monetised economy. People have forgotten this, especially in the US. They need to remember what democracy is supposed to be.

  5. September 9, 2015 at 10:34 am

    It evolves like a big game where local citizens are befooled for the benefit of few giants. Govt acts as a puppet to smooth the normal business by keeping people separated from the real happenings.

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