Have We Run Out Of Time?

Marty Levine

November 12, 2023

I have written over many years about the growing wealth gap in our nation. I have a number of concerns:  The wealth gap allows rich people to buy a life of luxury while others go hungry; and wealth is too easily translated into political power,  that can be used to prevent any efforts to build a more equitable system.  

Recent news tells us that if anything, things have gotten worse than when I first approached this issue.  

Here’s a chart based on data from the Federal Reserve Board’s just published “Survey of Consumer Finances October 2023” that is worth a thousand words.

73% of the nation’s wealth is controlled by the upper 10% of the population; and the “bottom” 60% have taken as a group, less than 5%.

Using the same data source, DQYDJ gives us this same story over time (1989-2022).

While there has been growth in the average amount of wealth at all levels of our society, the bulk of the growth has been grabbed by those who are already quite well off. And the gap is still growing.

The system that has allowed this continued concentration of wealth did not emerge by chance. It is one bought and paid for by those who have benefitted from it. Money has always been used to buy political influence and in our lifetimes, we are seeing how effectively that can be done to make it more and more possible to shape national, state, and local policies in ways that benefit the wealthy.

The Supreme Court that delivered the infamous 2009 Citizen’s United ruling that eviscerated our government’s ability to limit individual and corporate campaign spending was cleverly crafted by a wealthy group of conservative donors who understood that controlling the US Court system could be very valuable to their own interests. Over decades they used the nation’s philanthropic system to create the structures and organizations that would in time allow them to seed the Supreme Court, lower Federal Courts, and now even state courts with like-minded justices who would on many fronts shore up their power and support their personal biases.

By fueling election spending and preventing any limitations on individual spending the wealthy were given an open field to wield their fortunes to control the levers of government.  We can see how spending grew and dramatically increased election cycle by election cycle.  As reported by Open Secrets,  “political spending in the 2020 election totaled $14.4 billion, more than doubling the total cost of the record-breaking 2016 presidential election cycle.”  Yesterday’s Ohio ballot asked voters to approve a pro-choice Constitutional Amendment; more than $60 million was raised to support campaigns to approve/defeat that proposal.  Even running for a seat on a school board now means raising and spending amounts that were once thought of as unthinkable for a local election. For example, in last week’s Denver School Board elections candidates spent in excess of $1million!

With no limits on individual giving, the very wealthy have fueled this explosion by institutionalizing the pay-to-play nature of American governance. I have to look no further than Illinois’ 2-term governor, J.B. Pritzker to see how personal wealth is being used to get direct power. According to the Chicago Tribune, Pritzker “ has spent $350 million” of his own fortune to fuel his two election victories. In doing this he saw himself facing off with two other mega-wealthy individuals, Ken Griffey ($27 million in 2018) and Robert Uhlein ($48 million in 2022) to defeat Pritzker. 

Being able to buy power allows so many benefits.

One is to ensure that policies that protect individual wealth remain in place. Samantha Jacoby, Senior Tax Legal Analyst, Center on Budget and Policy Priorities, just last spring testified before the Senate Committee on the Budget and provided us one example of  how Federal Tax policy has been steered over time for the benefit of the wealthiest Americans, allowing them to retain and grow the wealth that buys them power:

“U.S. policymakers have substantially reduced taxes for wealthy households in recent decades. The 2001 and 2003 Bush tax cuts^[2] reduced individual income tax rates, taxes on capital gains and dividends, and the tax on estates, all of which provided the largest benefits to the highest-income taxpayers. Though policymakers let many of the Bush tax cuts for high-income households expire in 2013, the 2017 Trump tax cuts again lowered individual income tax rates (including the top rate) and weakened the estate tax, so that it applied only to the wealthiest estates: those worth more than $11 million per person or $22 million per couple, indexed for inflation. The 2017 law also created a large new tax deduction on “pass-through” business income (business income from partnerships,  corporations, and sole proprietorships) and enacted large and permanent tax cuts for corporations.

“Taken together, these tax cuts disproportionately flowed to households at the top and cost significant federal revenues, adding trillions to the national debt since their enactment.^[3] By shrinking revenues, these tax cuts limit policymakers’ ability and willingness to make public investments that pay off in tangible and important ways for individuals, families, communities, and the country as a whole.”

And what occurred in the last few years continued a decades-long successful effort to reduce taxes on the wealthiest:

That’s effective use of the power of wealth!

That power can also give men and women the ability to have a disproportionate influence on institutions well beyond government.

In the wake of Hamas’ brutal attack on Israel wealth gave select men and women the cudgel to stifle those they disagreed with. A New York Times headline told us quickly those who are able to be big donors, are able to use their wealth as a weapon: “ Warning of ‘Grave’ Errors, Powerful Donors Push Universities on Hamas”. Wall Street financiers are pressing elite schools to condemn criticism of Israel…more than a dozen donors said they felt they had a right and an obligation to weigh in.  Among them was Ken Griffin of political donation fame, who had given Harvard University $.5 billion!

The threat of loss of access to that wealth ensures access and allows individuals to press institutions to do their bidding. The clout of wealth makes those disagreeing with Griffin and his peers struggle to be heard in the places where decisions are made.

Just sing along with me on these lyrics from Lin-Manuel Miranda’s Hamilton to and you will understand the inordinate advantage that money can by”

“No one else was in
The room where it happened
The room where it happened
The room where it happened
No one else was in
The room where it happened
The room where it happened
The room where it happened
No one really knows how the game is played
The art of the trade
How the sausage gets made
We just assume that it happens
But no one else is in
The room where it happens.”

And that is essentially the problem with the wealth inequality of our nation.

Our nation’s vaunted democracy is being hollowed out because we have not taken steps to make things different and fairer.

The hard question is: Have the wealthy already tipped the balance so far that it is beyond repair? With so much power in their hands are the majority now left to depend on the noblesse oblige of the wealthy?  Are most of us dependent on the goodwill of folks like George Soros and Mackenzie Scott? Have we already lost the battle for a free and fair society?

Tuesday’s election results provide a glimmer of hope. People used the power of the ballot box, supported by wealthy donors who agreed with them, to overcome well-funded opponents and stand up for reproductive freedom and control of their local school districts.

Now the question is can this same energy rise up to elect leaders who are ready to make the systemic changes we need in our system to reverse course and create a more equitable society where wealth is not horded? Can we elect brave leaders who are ready to reform our electoral system so that it cannot be manipulated so that the wealthy protect their privilege?

Time is not on our side. 2024 is just around the corner.