We Used to Make the Rich Poorer and the Poor Richer

Rich_poorBy David Swanson

Many of us have heard the current period referred to as a second gilded age. Or we’ve seen the current inequality in wealth in the United States compared to that of 1929. But we have not all given sufficient thought to what ended the first gilded age, what created greater equality, what created the reality behind that category our politicians now endlessly pretend we are all in: the middle class. We have a sense of what went wrong at the turn of each century, but what went right in between?

This is the theme of Sam Pizzigati’s new book, “The Rich Don’t Always Win: The Forgotten Triumph Over Plutocracy That Created the American Middle Class, 1900-1970.” I take away three primary answers short enough to include in a brief summary. First, we taxed the riches right out from under the rich people. Second, we empowered labor unions. And third — and this one came first chronologically as well as logically — we developed a culture that saw it as absolutely necessary for the greater good that the rich be made poorer.

Nowadays, it’s not hard to find people who would like the poor to be richer. But who wants the rich to be poorer? It seems so impolite and improper and cruel. Surely Bill Gates earned, deserves, and needs his $66 billion. While he might live exactly as comfortably as before if he lost 65 of those billions, how could we expect others to do all the good Gates has done (surely he’s done some) if they can’t expect to also be permitted to hoard $66 billion while other people starve and go homeless. In fact, without the possibility of hoarding your own $66 billion, nobody will work (will they?) or “create jobs” for others, and in the end if we took $65 billion away from Gates it would vanish into the air leaving the poor even poorer than they’d been. Or so we like to fantasize.

Pizzigati points to the polling that shows that Americans imagine their nation is much more equal than it is, and that they would like it to be more equal still — would in fact far prefer Sweden’s distribution of wealth to our own. But what does this tell us about our willingness to do what it takes to get there? I just saw an article in Mother Jones Magazine claiming that President Obama’s caving in and permitting the continuation of the “Bush” tax cuts for the super wealthy was actually a progressive victory because of other things Obama got in the process. Such analyses suffer, I think, not just from hero-worship and partisan defensiveness, but from misplaced priorities. Taxing the rich is absolutely essential to every humanitarian cause and the viability of representative government.

“We can have democracy in this country,” Louis Brandeis accurately said, “or we can have great wealth concentrated in the hands of a few, but we can’t have both.”

The history that Pizzigati tells demonstrates this. Democracy and wealth concentration rise and fall in opposition to each other. Limitations on extreme wealth do nothing to reduce work and initiative. Extreme wealth impoverishes the poor; it doesn’t enrich them. Trying to enrich the poor while allowing the rich to grow richer is an uphill if not impossible struggle, as the super-rich rewrite the rules to their own advantage. Thus “Tax Cuts For Everybody!” is an even worse policy than we commonly understand. It’s not just that Congress rigs such deals to give the wealthiest the biggest cuts, but beyond that the wealthy will gain the power to quickly enact even worse legislation for the rest of us.

In the decades before World War I, authors and activists built an understanding that survived that horror, an understanding that the rich needed to be brought down if the poor were going to be brought up, that a rising tide doesn’t lift all ships, that voodoo economics doesn’t work just because preaching it can get you elected. It took decades of struggle, partial victories, and many setbacks. It took civil disobedience. It took third political parties. It took a willingness to spend money on World War II that we have yet to compel our government to spend on green energy or infrastructure or education or health. It took the alternative of communism competing for the world’s approval. It took until the 1940s and 1950s for success to come. It was never a perfect success, and it came under greater threat of reversal the more people came to take it for granted. The success came after some who had worked for it had died. It came slowly.

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