Pressures on the System Threaten the Wealthy's Income Stream


ROBERT REICH WEARS many hats. He is a professor of Public Policy at UC Berkeley. He brought his economic expertise to Republican Gerald Ford and Democrat Jimmy Carter's administrations. As Secretary of Labor during Bill Clinton's first stint in the White House, Reich oversaw an increase in the minimum wage and was an outspoken advocate of everyday Americans.

Reich is the focal point of the 2013 documentary 'Inequality For All.' His central assertion in the film is that while inequality drives the free market, severe wealth inequality makes the market stagnant. When the gap between the haves and have-nots is such that the bottom 47% of Americans have no wealth (and likely have significant debt), and 400 billionaires at the top have capital comparable to 80 million families, everyone loses out.

While I felt aligned with Reich's agenda from the beginning of the film, I did wonder how he would substantiate the claim that massive wealth inequality is bad for the very rich. I hoped that his rationale would go beyond some sort of moral-ethical dilemma of the one-percenters. As the film progressed, I got the quantitative documentation I was looking for.

During 'Inequality,' we follow a number of people, some billionaires, some struggling to keep enough food on the table for a family of four. The most telling interview came from the successful, thoughtful billionaire named Nick Hanauer. When asked about his yearly salary, he responds "anywhere from 10 million to 30 million." He acknowledges this is an absurd amount of money for one person to collect.

Hanauer describes how the gulf between ordinary Americans and a small circle of billionaires is actually bad for his business, and for the free market in general. As it turns out, billionaires only need a few pairs of blue jeans a year; they only purchase one or two pillows when necessary.

According to Hanauer, if his money was more evenly allocated throughout working class Americans, more consumers would be able to afford a new pair of jeans, and he would move more pillows. Sales would increase. Despite incredible capital and his position on the top of the economic ladder, Hanauer's bank account is hurt by inequality. The wealth disparity limits the free market system and each agent, rich or poor.

The documentary is not short on ways to address the widening wealth gap in the United States. Each facet of Reich's plan is rooted in years of economic research, not in dogma or partisan ideology. Some suggestions are a no-brainer. Decades ago, Japan showed the world that investing in education can be profitable for everyone. As Japan developed, officials prioritized training the workforce and made trade schooling widely available. Now, Japan is one of the wealthiest countries in the world.

Other calls for action are a thorough reform of Wall Street, more equitable tax policies, and greater oversight in the power of amassed wealth in the political system. Whether campaign contributions come from a multi-millionaire or a multi-national corporation, a small number of oligarchs are assuming the arms of democracy and monopolizing the ears of politicians, as per the Supreme Court decision in Citizens United.

While the challenge is great, Reich wants his viewers to feel empowered. Empowered to demand change, to refashion 'equality' from a buzzword to a basic requisite of the American way, to make sure that every person's voice is heard in their political system, regardless of the number of zeros and commas in his or her paycheck.

Follow Michael on Twitter Twitter: @nahmias_report Contributing Editor: @MAndrewRansom

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The Myth of American Democracy


Michael Ransom, Contributing EditorLast Modified: 00:57 a.m. DST, 24 April 2014

February 2014 Moral March On Raleigh 56 Name: Stephen Melkisethian Date: February 8, 2014 Location: Shaw University, Raleigh, North CarolinaUNITED STATES - A 240-year-old illusion is under scrutiny, and the data is conclusive. All dogma and buzzwords aside, the United States of America operates as an Oligarchy.

New empirical research disproves the idea that the U.S. is a democracy. A common response to these claims is "of course not, America is a Republic." Well, also incorrect, it turns out. According to a joint study by leading experts in the political sphere, the terms "democracy" or "republic" are erroneous adjectives.

Testing Theories of American Politics is a recent study to be published in Perspectives on Politics academic journal this Fall. The report is authored by Martin Gilens and Benjamin Page, who teach at Princeton and Northwestern Universities respectively. The professors compiled 20 years of political data to cross-reference political decisions with the will of the American majority.

Their results are telling. The model takes 1,779 unique policies into account, and finds that with uncanny predictability, the intentions of wealthy Americans are fulfilled through the actions of politicians. Thus, the study concludes that the government is run by a select few. However, unlike a military state, those in power in America rule through the dollar, and not by the sword.

The findings of Gilens and Page are rooted in prevailing philosophies of American democracy. The four possible outcomes of the statistics are also the four principle theories of public policy control: power either lies with the majority, the wealthy, collected citizens or collected wealth. Marjoritarian Electoral Democracy, Economic Elite Domination, Majoritarian Pluralism and Biased Pluralism are the theories that correspond to each of these demographics, when each group is at the reins of political power.

The scholars conclude that "The results provide substantial support for theories of Economic Elite Domination and for theories of Biased Pluralism, but not for theories of Marjoritarian Electoral Democracy or Marjoritarian Pluralism." In layman's terms, the wealthy and the interest groups of the wealthy have primary sway over government dealings.

Later in the report the authors introduce tables to illustrate their findings. This data indicates that the voice of the majority is largely silenced by corporate America. Even in the face of the people's dissent big-money interests will win-out in policy making.

All this is disturbing, especially in a nation that claims to be the home of a special breed of democracy and independence. Some even claim the New World to be the origins of democratic government. But anyone with an internet connected or a reputable textbook can unravel this fabrication.

A host of nations claim to be the birthplace of democratic government, but some have more founded reasoning than others. Iceland created the Althing parliament in 930 CE, creating a commonwealth society where representatives met to make laws and nominate judiciaries. By some standards, they are the inventors of the democratic state.

The Isle of Man holds the record for the oldest democratic body still in operation. The Tynwald legislature began in 979 CE and elects its members into positions in the executive branch. And New Zealand set a global precedent by establishing universal suffrage in 1893.

The United States cannot be decorated with any of these accolades. And now, their status as a democracy is questionable at best. If America could check the power of the dollar on supposed democratic dealings by limiting the impact of private monies in public elections, the voice of the majority would be audible for the first time.

Follow Michael on Twitter Twitter: @nahmias_report Contributing Editor: @MAndrewRansom

Lady Gaga | The Movie 'Brazil'

Lady Gaga | The Movie 'Brazil'

Lady Gaga is an interesting phenomena whose theatrical and satirical music videos offer an insightful commentary on and parody of America's wanton sexuality, consumerism and self-absorbed showmanship. Even the ambiguity of her sex and sexuality contribute to effectiveness of her appeal as an extraordinarily marketable performance artist. As a consequence of several comments from readers, it should be noted that this critique of Lady Gaga is limited to the video "Paparazzi," as I am unfamiliar with the rest of her work.

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