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The One Percent: Gigantic Government + Gigantic Corporations = Massive Wealth In

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Volitzer
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« on: October 27, 2011, 03:23:38 pm »

The One Percent: Gigantic Government + Gigantic Corporations = Massive Wealth Inequality


The Economic Collapse
October 27, 2011

Today, there are protests all over America that are targeting “the one percent” and all of the wealth and power that they have accumulated. Unfortunately, many of the solutions that these protesters are advocating simply will not work and will not lead to less wealth inequality. To understand this, you have to understand how we got to this point.

Over the past several decades, our federal government has exploded in size and our large corporations have exploded in size. In fact, we have seen this pattern happen pretty much all over the world. Governments and corporations all over the globe are getting much bigger. Whenever you have very, very large concentrations of money and power like that, it is going to lead to massive wealth inequality.

The Occupy Wall Street protesters would like to frame this debate as “socialism vs. capitalism”, but the truth is that wherever you find big government you will almost always find big corporations, and wherever you find big corporations you will almost always find big government. Sure, they spar once in a while, but the reality is that big government and big corporations work in tandem most of the time.

Sometimes big government has the upper hand and sometimes big corporations have the upper hand, but they are both collectivist institutions. Wherever you find collectivism in the world, you will find an elite that receives most of the benefits while the rest of the population suffers. In the United States today, our gigantic government is thriving and our gigantic corporations are thriving and the middle class is rapidly shrinking.

The solution to this is not to replace one form of collectivism with another form of collectivism. Rather, what we need is to go back to what our founding fathers intended. They were extremely suspicious of large concentrations of wealth and power, and they intended for us to live in a capitalist system where individuals and small businesses had the freedom to compete and thrive.

Today, Democrats tell us that we need an even bigger government and that we need to redistribute even more wealth to the poor. But the bigger the government gets, the more poor people we seem to have. As you will see below, the only people that seem to be thriving from big government are the bureaucrats.

Republicans tell us that we need to make life better for the big corporations. But the reality is that the bigger our giant corporations get, the faster the middle class shrinks. The big corporations are shipping millions of our jobs out of the country, and they are magnets for wealth and power. If you are not aware of how overwhelmingly dominant corporations have become in our society, just read this article.

Democrats should not be defending big government, and Republicans should not be defending the abuses of the big corporations.

Whenever big government and big corporations work together there is going to be massive income inequality, and massive income inequality is not a good thing.

Yes, there are always going to be some people that do much better than others (and there is nothing wrong with that), but we should not have a system which is designed to funnel almost all of the wealth and almost all of the power to a very small minority.

In essence, this article is arguing the following….

Gigantic government = bad.

Gigantic corporations = bad.

This was the view of our founding fathers, and this is what we need to get back to.

Let’s take a look at some of the results of our current system. Let’s start with income inequality caused by big government.

Today, the Washington D.C. region has the highest median household income in the entire nation. According to the most recent numbers, median household income in the D.C. area is $84,523.

So what is the cause of this?

Well, it is not because Washington D.C. is a great center of industry or finance. Rather, it is because the federal government is spending over 3 trillion dollars a year and is showering huge piles of cash on hordes of bureaucrats.

In a recent article, I noted some of the mind blowing statistics that show how bureaucrats in Washington D.C. are living the high life at our expense….

*When you total up all compensation (including health care and benefits), the average income for a federal worker in the Washington D.C. area last year was $126,369.

*In 2005, 7420 federal workers were making $150,000 or more per year. In 2010, a whopping 82,034 federal workers were making $150,000 or more per year. That is more than a tenfold increase in just five years.

*In 2005, the U.S. Department of Defense had just nine civilians earning $170,000 or more. When Barack Obama took office, the U.S. Department of Defense had 214 civilians earning $170,000 or more. In June 2010, the U.S. Department of Defense had 994 civilians earning $170,000 or more.

*Last year, federal employees “earned” approximately 447 billion dollars in total compensation.

As I have written about previously, our gigantic federal government also empowers the big corporations to continue to accumulate staggering amounts of wealth and power. This is one reason why the big corporations contribute so much money to political campaigns. The big corporations (and the elite that own and run them) have much more influence over the political process than we do. They have spent decades buying politicians and getting laws passed that tilt the rules of the game radically in their favor.

This is something that our founding fathers did not want to happen. In a 2010 article, Rick Ungar noted that there were very significant restrictions on corporations in the early days of America….

After the nation’s founding, corporations were, as they are today, the result of charters granted by the state. However, unlike today, they were limited in how long they were permitted to exist (typically 20 or 30 years), only permitted to deal in one commodity, they could not own shares in other corporations, and their property holdings were expressly limited to what they needed to accomplish their corporate business goals.

There was a lot of wisdom to that approach. Our founding fathers knew that corporations would become giant magnets for wealth and power if they were allowed to grow unchecked.

Today, multinational corporations completely and totally dominate the global economy. The following comes from a recent article I posted on The American Dream….

Corporations not only completely dominate the U.S. economy, they also completely dominate the global economy as well. A newly released University of Zurich study examined more than 43,000 major multinational corporations. The study discovered a vast web of interlocking ownerships that is controlled by a “core” of 1,318 giant corporations. But that “core” itself is controlled by a “super-entity” of 147 monolithic corporations that are very, very tightly knit. As a recent article in NewScientist noted, these 147 corporations control approximately 40 percent of all the wealth in the entire network

These giant corporations are so dominant that it is nearly impossible to compete with them. The number of small businesses in America is shrinking fast.

According to the Bureau of Labor Statistics, 16.6 million Americans were self-employed back in December 2006. Today, that number has shrunk to 14.5 million.

This is exactly what we would expect to see under “corporatism“, but under true capitalism we would expect to see the exact opposite.

As the federal government and the big corporations continue to grow, the middle class is being wiped out. If you doubt that the middle class is shrinking, just read this article.

Yes, there is a limited role for the federal government to play and there is a limited role for corporations to play. But right now things are radically, radically out of balance.

This is creating a tremendous amount of income inequality in the United States. The middle class is being systematically destroyed, and the growth of the gap between the one percent and the rest of us just continues to accelerate.

This was certainly illustrated by numbers that were recently released by the Congressional Budget Office. The very wealthy have done extremely well over the last 30 years. For the rest of us, things have not been so great. The following figures come from a recent blog post by the director of the Congressional Budget Office….

CBO finds that between 1979 and 2007:

For the 1 percent of the population with the highest income, average real after-tax household income grew by 275 percent (see figure below).
For others in the 20 percent of the population with the highest income, average real after-tax household income grew by 65 percent.
For the 60 percent of the population in the middle of the income scale, the growth in average real after-tax household income was just under 40 percent.
For the 20 percent of the population with the lowest income, the growth in average real after-tax household income was about 18 percent.
Meanwhile, as a recent USA Today article noted, the middle class continues to falter in the majority of the communities around the United States….

A USA TODAY analysis of Census data found the Reno area was among 150 nationwide where the share of income going to the middle class — generally made up of households that make $20,700 to $99,900 a year — shrank from 2006 to 2010. Metro areas where the middle class’ share of income dropped outnumbered those where it grew by more than 2-to-1.

So just how well is the top one percent doing compared to the rest of us?

The following statistics should be a wake up call for all of us….

*According to the Congressional Budget Office, the top one percent is the only group that saw its share of our national income increase between 1979 and 2007.

*According to a joint House and Senate report entitled “Income Inequality and the Great Recession“, the top one percent of all income earners in the United States brought in a total of 10.0 percent of all income income in 1980, but by the time 2008 had rolled around that figure had skyrocketed to 21.0 percent.

*Between 1979 and and 2007, the average household income of the top one percent of all Americans soared from $346,600 to $1.3 million.

*In the United States today, the wealthiest one percent of all Americans have a greater net worth than the bottom 90 percent combined.

*As the “one percent” thrives, the share of the pie being enjoyed by the middle class is shrinking. According to Heidi Shierholz, an economist with the Economic Policy Institute, about 53 percent of all income went to the middle class back in the 1970s, but today only about 46 percent of all income does.

*According to Harvard Magazine, 66% of the income growth between 2001 and 2007 went to the top one percent of all Americans.

*The wealthiest one percent of all Americans now own more than a third of all the wealth in the United States while the poorest 50 percent of all Americans collectively own just 2.5% of all the wealth in the United States.

*The wealthiest one percent of all Americans own over 50% of all the stocks and bonds.

*The top 0.01% of Americans make an average of $27,342,212. The bottom 90% make an average of $31,244.

*This is all happening at a time when the United States as a whole is slipping. Ten years ago, the United States was ranked number one in average wealth per adult. In 2010, the United States fell to seventh.

*Income inequality is not just growing in the United States. Today, the wealthiest one percent of the earth’s population controls 39% of the wealth.

There is certainly nothing wrong with being wealthy. If you and your family work really hard and provide great value to the community around you then you should greatly benefit.

But a system that is designed to systematically drain wealth from the general population and transfer it into the hands of an ultra-wealthy elite is not what our founding fathers ever hand in mind. At the time of our founding, England was dominated by big government (the monarchy) and by big business (the East India Company, for example). Our founders warned us over and over about the potential abuses that can happen when very large concentrations of wealth and power are allowed to dominate a society.

Unfortunately, the Occupy Wall Street movement has it all wrong. They recognize the overwhelming wealth and power accumulated by the one percent, but most of them are advocating even more collectivism as the answer.

Some of them even say that they want to “end capitalism” altogether. Michael Moore says that he is not part of the one percent and that he wants to “end capitalism”, even though he has made millions upon millions of dollars from his various projects.

But socialism and communism never bring equality. Like other forms of collectivism, socialism and communism almost always bring more tyranny and they almost always funnel most of the financial rewards to a very small elite.

Others simply wish to see the U.S. government transfer more wealth from the hands of the rich to the hands of the poor.

Helping the poor is certainly a noble goal, and handouts can certainly ease suffering at least temporarily. But handouts are never a permanent solution and they can cause large numbers of people to end up becoming completely and totally dependent on the government.

Back in 1980, government transfer payments accounted for just 11.7% of all income. Today, government transfer payments account for 18.4% of all income.

So has the plight of the poor gotten better?

No, we now have more than 45 million Americans on food stamps, last year we had the largest increase in the number of Americans living in poverty in U.S. history and the middle class continues to shrink rapidly.

The truth is that what poor and middle class Americans really need are opportunities. Handouts will keep people alive, but they will not give people hope and a future.

What Americans really need is an environment where they can find jobs or start small businesses. Unfortunately, the environment for small businesses in this country is incredibly toxic and millions of our good jobs have been shipped overseas. The big corporations have discovered that they can make even bigger profits by sending jobs to countries where it is legal to pay slave labor wages. To say that we need big corporations because they are the ones that “create jobs” is simply not true anymore.

So now we have tens of millions of Americans that we have to take care of every single month. There is nothing wrong with helping them survive, but giving them even more handouts is not going to permanently solve anything.

We need to have a population that is empowered to work hard, produce wealth and create a bright future for their families.

Instead, what we have is a system that greatly rewards the top one percent and that is pushing all of the rest of us toward poverty.

Gigantic government plus gigantic corporations is always going to equal massive wealth inequality.

The bigger we allow government to grow and the bigger we allow corporations to grow, the worse it is going to get.

So is any of this going to change any time soon?

Well, considering the fact that the vast majority of our politicians are in the pockets of the big corporations, I would not be getting your hopes up.

http://www.prisonplanet.com/the-one-percent-gigantic-government-gigantic-corporations-massive-wealth-inequality-in-america.html
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Krista Davenport
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« Reply #1 on: October 27, 2011, 09:55:53 pm »

Quote
The Occupy Wall Street protesters would like to frame this debate as “socialism vs. capitalism”, but the truth is that wherever you find big government you will almost always find big corporations,

Man are you and your pals over at prisonplanet ever clueless.  It isn't about "socialism vs. capitalism."  You think all the protesters all over the world right now are advocating "socialism?"  They are advocating for income equality, you doofus. Why should 1% get all the wealth? Stop printing your propaganda from prisonplanet and actually think about it:

Why should some rich a@@hole who, 90% of the time was just born into a rich family get to have billions of dollars while other people can't find jobs, starve and are homeless?  Nobody deserves that kind of money. And there's nothing that anyone any does for a living that is worth billions of dollars a year anyway. Your pals over at prisoplanet can't understand it cause people are pissed that the money hoarders have stolen all the wealth of this country, that's because they are all Repugs at heart, and that's why they label it "socialism." They think that the f@@@n rich actually did something to earn that money!  All those bastards did was cheat people out of it, i.e., the latest derivatives scandal.

Socialism, for your information, is where the government gets all the money. We want the jobs, money and tax relief to be spread among EVERYBODY and they better get used to it cause we aren't going away.
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Volitzer
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« Reply #2 on: October 28, 2011, 01:03:22 pm »

I've seen this done on FOX & MSNBC where they make it all about being anti-capitalism.

It is just the CFR telling regular media what to say and print as usual.

The real protest is anti-Wall-Street and anti-FED of course the gov't media buffoons are going to try to discredit it with the fringe elements.

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Krista Davenport
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« Reply #3 on: October 28, 2011, 10:41:54 pm »

Quote
I've seen this done on FOX & MSNBC where they make it all about being anti-capitalism

You're missing the point. The article from prisonplanet ALSO makes it look like it is against capitalism, too.  That shows where their loyalties lay.
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Volitzer
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« Reply #4 on: October 29, 2011, 12:56:47 pm »

Yes, there are always going to be some people that do much better than others (and there is nothing wrong with that), but we should not have a system which is designed to funnel almost all of the wealth and almost all of the power to a very small minority.

Quote
In essence, this article is arguing the following….

Gigantic government = bad.

Gigantic corporations = bad.

This was the view of our founding fathers, and this is what we need to get back to.

Let’s take a look at some of the results of our current system. Let’s start with income inequality caused by big government.



&

Quote

Back in 1980, government transfer payments accounted for just 11.7% of all income. Today, government transfer payments account for 18.4% of all income.

So has the plight of the poor gotten better?

No, we now have more than 45 million Americans on food stamps, last year we had the largest increase in the number of Americans living in poverty in U.S. history and the middle class continues to shrink rapidly.

The truth is that what poor and middle class Americans really need are opportunities. Handouts will keep people alive, but they will not give people hope and a future.

What Americans really need is an environment where they can find jobs or start small businesses. Unfortunately, the environment for small businesses in this country is incredibly toxic and millions of our good jobs have been shipped overseas. The big corporations have discovered that they can make even bigger profits by sending jobs to countries where it is legal to pay slave labor wages. To say that we need big corporations because they are the ones that “create jobs” is simply not true anymore.

So now we have tens of millions of Americans that we have to take care of every single month. There is nothing wrong with helping them survive, but giving them even more handouts is not going to permanently solve anything.

We need to have a population that is empowered to work hard, produce wealth and create a bright future for their families.

Instead, what we have is a system that greatly rewards the top one percent and that is pushing all of the rest of us toward poverty.

Gigantic government plus gigantic corporations is always going to equal massive wealth inequality.

The bigger we allow government to grow and the bigger we allow corporations to grow, the worse it is going to get.

So is any of this going to change any time soon?

Well, considering the fact that the vast majority of our politicians are in the pockets of the big corporations, I would not be getting your hopes up.


The article bashes crony-capitalism at the expense of the rest of America.  Not regular capitalism that helps people be self-suffcient. 

Where are you reading ?   Huh
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Krista Davenport
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« Reply #5 on: November 02, 2011, 12:56:15 am »

Well, here you go, Volitzer:
Quote
The Occupy Wall Street protesters would like to frame this debate as “socialism vs. capitalism”, but the truth is that wherever you find big government you will almost always find big corporations, and wherever you find big corporations you will almost always find big government.

I haven't seen any signs where the protesters are advocating a move to socialism, have you?  Socialism is where the government controls and profits from owning all the industries in the country. So rather than try and "get" what Occupy Wall Street is all about, this prisonplaneter just makes more stuff up - as usual!  The only way things will ever change in this country, is to have an honest conversation about the problems and the solutions in this country, not make up straw men to protect the filthy rich.
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Volitzer
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« Reply #6 on: November 02, 2011, 05:10:25 pm »

That paragraph is right off of FOX News.  It is true regarding the fringe element of collectivists that showed up but it isn't true of OWS as a whole.  Even PETA has been known to show up to these things.
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Krista Davenport
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« Reply #7 on: November 02, 2011, 11:56:02 pm »

Again, I haven't seen anyone advocating socialism and the paragraph was written by the prisonplanet writer, FOX had nothing to do with it. In their own way, they do what they can to support the rich, too.
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