Plutocratic Paranoia

Paranoia strikes deep
Into your life it will creep
It starts when you’re always afraid
Step out of line, the man come and take you away

—Stephen Stills, “For What It’s Worth

In a God-fearing, if not God-ordered, world, one would think that when a billionaire, worried about “a rising tide of hatred of the successful one percent,” stupidly compared progressive critiques of wealth inequality in America to “fascist Nazi Germany,” that reputable institutions, say, like The Wall Street Journal, would have the sense to unequivocally condemn such outrageous nonsense.

Nope. Not only did the Journal publish this disgruntled plutocrat’s letter about a week ago, today we find that the paper’s editorial writers, always happy apologists for our emerging plutocracy, have now become defenders of plutocratic paranoia. Oh, there was the gentle admission that one ought to be more careful in one’s use of comparisons to Nazi Germany, but the real condemnation was saved for what the writers called “the politics of economic class warfare,” which is how the rich right views any criticism of the one-percenters gobbling up most of the bennies the economic recovery has handed out the past four years or so.

Paranoia is striking deep into the hearts of some of America’s wealthiest folks and the ideological defenders of an out-of-adjustment economic system. Perhaps they are starting to believe that liberal critiques of what has been happening for the last 35 years are beginning to resonate with the electorate. Why else would the WSJ editorialists end their defense of the disgruntled plutocrat by falsely saying that liberals are “promoting personal vilification and the abuse of government power to punish political opponents”?

In any case, back to reality. Paul Krugman published a piece a few days ago that addressed the billionaire’s comparison of progressivism to fascism, but he went much further:

Anyway, thinking about this sort of thing makes me realize that there’s a danger, especially for progressives, of confusing the proposition that Obama’s billionaire haters are stark raving mad — which is true — with the proposition that Obama has done nothing that hurts the plutocrats’ interests, which is false. Actually, Obama has been tougher on the one percent than most progressives give him credit for.

Oh, I know that some lefties don’t want to hear it, but Krugman, who has been somewhat critical of President Obama over the years, has some facts to back up what he is saying:

Start with taxes. The Bush tax cuts haven’t gone completely away, but at the very high end they have been pretty much reversed; plus there are additional high-end taxes associated with Obamacare. The result is that taxes on wealthy Americans have basically been rolled back to pre-Reagan levels:

Meanwhile, financial reform looks as if it will have significantly more teeth than expected.

So the one percent does have reason to be upset. No, Obama isn’t Hitler; but he is turning out to be a little bit of FDR, after all.

That chart (which was lifted from an excellent article written by the Atlantic’s Jordan Weissmann) along with Krugman’s remark about the unexpected “teeth” in financial reform (“Dodd-Frank“) may explain why some billionaires, who should have nothing in the world to complain about—what good is all that dough, if you are still afraid of the rabble?—would resort to Nazi references when talking about liberals criticizing them. They feel victimized. Yep. Victimized.

Matthew O’Brien, in a piece titled, “Why Do the Super-Rich Keep Comparing Obama to Hitler?” referenced an occasion during Obama’s first term in which some really wealthy folks, including some of those Obama had referred to late in 2009 as “a bunch of fat cat bankers on Wall Street,” leaned on Obama’s campaign manager, Jim Messina, for a little love from the President. Messina was in New York looking for campaign money—since Obama had done very well among Wall Streeters in 2008—and The New York Times described what happened:

For the next hour, the donors relayed to Messina what their friends had been saying. They felt unfairly demonized for being wealthy. They felt scapegoated for the recession. It was a few weeks into the Occupy Wall Street movement, with mass protests against the 1 percent springing up all around the country, and they blamed the president and his party for the public’s nasty mood. The administration, some suggested, had created a hostile environment for job creators.

Messina politely pushed back. It’s not the president’s fault that Americans are still upset with Wall Street, he told them, and given the public’s mood, the administration’s rhetoric had been notably restrained.

One of the guests raised his hand; he knew how to solve the problem. The president had won plaudits for his speech on race during the last campaign, the guest noted. It was a soaring address that acknowledged white resentment and urged national unity. What if Obama gave a similarly healing speech about class and inequality? What if he urged an end to attacks on the rich? Around the table, some people shook their heads in disbelief.

“Most people in the financial world,” a top Obama donor later told me, “do not understand how most of America feels about them.” But they think they understand how the president’s inner circle feels about them. “This administration has a more contemptuous view of big money and of Wall Street than any administration in 40 years,” the donor said. “And it shows.”

How a group of people with more money than Allah could feel victimized by Obama or any other slightly left-of-center Democrat is beyond me. Perhaps they are starting to hear too many comparisons they don’t like. Maybe they don’t like it when they hear, as it was recently reported, that “The 85 richest people in the world now have as much money as the 3.5 billion poorest put together.”  Or maybe they don’t like it when they hear Paul Krugman’s latest comparison, which he presented yesterday on NPR’s All Things Considered:

I just had my favorite statistic of this morning. The top 40 hedge fund managers in America earned as much as 300,000 schoolteachers in 2012. So that gives you an idea of how unequal a society we’ve become.

You can see where that might ring with a sting in the ears of those “top 40 hedge fund managers,” sort of like a Hitler comparison rings in the ears of a liberal.

But let’s be clear here. No one, at least no one that I know, is talking about “punishing” rich people. It’s not a bad thing that hard work and innovation is rewarded over sloth and foolishness. As Krugman said on NPR:

Nobody thinks that we should be a society without monetary incentives. No one thinks that we should have exact equality or even anything close to that. The point, however, is that our notion of what kind of society we should be, I think, is something like the kind of society we actually were 30, 40 years ago where we had a broad middle class, where the gap between people at the top and the average or the median American was not that large.

See? There’s no need for those hyper-sensitive, fraidy cat billionaires to go all Hitler on us.

Finally, even though there is a rather robust defense of plutocratic paranoia going on among some conservatives, there is some evidence that even Republicans are starting to get the message that the inequalities we see among us threaten our stability as a nation, or, more likely, they are starting to think that such inequalities threaten their electoral prospects as a national party. They are starting to talk about the issue, even though they largely blame it on Obama, and offer as solutions the same old tax-cutting, trickle-down, anti-regulatory nonsense.

But at least for now the issue is front and center and that’s not a bad thing.

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  1. The top 40 hedge fund managers in America earned as much as 300,000 schoolteachers in 2012. So that gives you an idea of how unequal a society we’ve become. – Krugman

    If you use too many zeroes it blurs the mind. Another way to look at it: On average, the 40 top hedge fund managers each made as much as seven thousand five hundred teachers. Each.

    Hum. Still doesn’t quite do it. There are about 106 teachers in Joplin High School, so that means the elite 40 earned as much as all the teachers in 70 average-size high schools. Wow.


    • I don’t know what the complete answer is to all this, Jim, but I do know that part of the answer, even if it may be a relatively small part of the answer, is that hedge fund managers’ income should be taxed as ordinary income rather than the quite generous “carried interest” treatment, which means that many of these folks are taxed at the much lower capital gains tax rate. It seems to be that is the first step we should take on any policy journey that attempts to narrow the gap between the rich and everyone else.



  2. kabe

     /  January 30, 2014

    It’s funny how they have no problem with the way Unions have been demonized even though they make up only about 10% of the work force.


    • Demonizing unions is necessary, Kabe, if the plutocrats are to have their way in the workplace, if they are to continue making money—corporate profits are historically high as workers’ wages are stagnant or falling—from essentially keeping wages and benefits for workers as low as possible. The sad thing is, and sometimes I am amazed at how this can be true, but those who would most benefit from strong unionization are the first to criticize it. You have to hand it to the plutocrats, they are very effective propagandists.



  3. ansonburlingame

     /  January 31, 2014

    If unions were so good for America, why is it that less than 10% of workers join unions?

    If I want to join a union I should (must) be free to make that choice, pay my dues and support such a collective effort. But government should in no way slant the law to force (or even encourage) me to join such a group and pay money to support it. Government should (must) be neutral in such decision-making. And for damn sure those that do govern (as opposed to “government”) should receive zero benefit from either side.

    As for taxes, well the season is upon us and we all now have our W-2s or 1099s. Frankly I could care less what you pay in taxes or anyone else right now. But I look at the figure on my computer now and it sure seems like a lot of money coming right out of my decidedly “middle class” (or lower) pocket. If I could wack off a few “Solyndras” and keep the change I would do so in a flash. And if I was working, I would not pay a cent into a union fund to try to get more money out of my pockets.



  4. kabe

     /  January 31, 2014

    Missing the point aren’t we AB?



  5. ansonburlingame

     /  February 1, 2014

    Not in my view, Kabe. Read Duane’s LTTE in the Globe and this blog and I at least get the underlying messge. Legislation proposed in MO to advance “right to work” laws (or whatever you like to call them) is Duane’s target. I opposed his efforts in that regard, however he chooses to color his positions.

    It is after all, all about the money in union funds, workers pockets, owners profits, etc. As Paul Greenberg pointed out today in his column in the Globe, liberty versus equality is the rub and we have been arguing about it since 1789, or thereabouts.



    • kabe

       /  February 1, 2014

      Since 90% of jobs are non-union,why would a person who dislikes unions even apply for a union job? Oh, thats right, they pay more and have benefits. What a dilemma for the anti union folks. Kabe


      • They love the good-paying jobs alright. They just don’t want to pay even a penny to the entity who secured those benefits. Freeloaders.


  6. ansonburlingame

     /  February 2, 2014


    Probably not the correct place to hold such a debate but it is a good and interesting topic that confounds many. Why in the world would any “worker” NOT advocate unionization if pay and benefits are the goal(s) of such workers? At least to me, personally, the answer is self evident.

    If an individual agrees to join a collective effort to earn more money, he or she is limited by the success of the collective. I would get paid what the collective could bargin for on my behalf. One becomes capped out at some level of earning power and/or advancement.

    Some people, individualists to use a term, want more from a job than just punching a clock and getting money. Work, advancement, more “power” if you will, is the goal in an effort that consumes about one third of one’s time on earth (the other third sleeping and the last “recreation” or entertainment).

    Not once in my life did I choose to work in a given job because, primarily, of the pay. I wanted to be a success, a contributor to the company or organization for which I worked. I did not want to stagnate at a given level within an organization. I wanted to grow, professionally.

    Collectivization causes personal stagnation in the end in terms of advancement in authority, ability to “make a difference”, etc. Without being beholden to a collective I was limited only by my own performance, my individual ability to contribute to the goals of an organization.

    Now that in no way makes me “better than” (or worse than) any other individual wanting to work for a living. It was simply a difference of my own goals (ablility to make a difference) from those that choose to advance the cause (make more money) of a segment of a company, the collective part of a company or organization if you will.

    It would seem some 90% of “workers” today agree with me! That’s a joke by the way. Reasons for lack of unionization are far more complexe than my own personal philosophy about “work”.



  7. kabe

     /  February 3, 2014

    AB, I think you have helped make my original point about how some who bash labor are crying foul over the treatment of the wealthy. You seem a bit condescending here towards union employees. I cannot imagine what you think about a non-union job! 🙂 Most union employers also pay their managers more than non union organizations, Walmart for example. You are saying that by accepting a union job that one has no chance to advance, which is wrong. You say one has no chance to grow, which is wrong. (There are more ways to grow than by simply moving up the corporate ladder in my opinion.) Having power over others is not important to everyone. And I do not believe you when saying money is not important. If not, then why didn’t you just become a teacher and advance up the educational ladder? There are a hand full of union “careers” in this area which you would be hard pressed to place as dead end, as you seem to suggest. UPS driver, Railroad conductor, Empire linemen, Mail Carrier, Firefighter, and Policeman. These jobs may not appeal to you, but some people do actually like working outdoors and working with the public as opposed to trying to advance in the board room. These jobs offer an early retirement with a pension as well as 401ks. One can advance into theses organizations managerial system or even take a full time union position. I know many who have taken this route and have gone on to other careers after retirement to fulfill whatever other ambitions they may have.



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