This article is part of TPM Cafe, TPM’s home for opinion and news analysis.
Dismay over inequality comes in a variety of flavors. For many, it’s simply about fairness — nobody “deserves” a billion dollars, that level of wealth is nothing more than a byproduct of an unfair economic system.
But extreme inequality is not just about fairness. It’s about the sustainability of democracy. Concentrated wealth is concentrated power. We are seeing this on display with former New York City mayor Michael Bloomberg, who through shear financial means has propelled himself into the race for Democratic nominee. This shouldn’t be possible, yet it seems most of the Democratic nominees don’t understand the graveness of the situation.
At the Democratic debate in Nevada, MSNBC’s Chuck Todd broke character and asked a good question: Should billionaires exist?
Obviously, Bloomberg was okay with billionaires.
Sen. Amy Klobuchar (D-MN) said, “I’m not going to limit what people make.”
Mayor Pete Buttigieg seemed to agree: he began the debate by poking fun at Sen. Bernie Sanders (I-VT), describing him as “a socialist who thinks that capitalism is the root of all evil.”
Sen. Elizabeth Warren (D-MA) supports a tax on billionaires’ wealth.
Former Vice President Joe Biden’s solution to inequality is a familiar combination of higher taxes on corporations, increasing the capital gains tax — shuffling deck chairs on the Titanic kind of stuff.
Only Sanders seems to identify and talk about the threat billionaires pose simply by existing.
Here’s the problem: A country that permits people to attain unlimited wealth allows them to possess unlimited political power. They can donate unlimited sums of money to political causes and campaigns, a problem compounded by the fact that political parties draw their own districts. When unlimited money means unlimited influence, those with money will continue to invest in politics to protect and increase their influence. It puts the country on the road to oligarchy. Wealth taxes are not just important tools to redistribute wealth, they are a critical check on the political power of the super wealthy.
In many ways the debate over the existence of billionaires comes down to whether you value individual liberty more than you value human lives. As Sanders said, it’s immoral to have billionaires while there are homeless people. There shouldn’t be billionaires while there are starving children or people who can’t afford medical treatments they need to stay alive.
A system that allows billionaires but taxes them at a higher rate is a system not long for this world. Money is power and influence. Eventually, the billionaires will wrest power back and change the tax rates, much in the way the GOP bamboozled Americans by lowering the corporate tax rate under the ruse that it makes America more attractive for business investment.
Capitalism requires strict regulations to ensure fairness. But those regulations are always an election away from being removed by moneyed interests. Because capitalism is okay with inequality, it’s inevitable that all efforts to hinder extreme wealth accumulation will eventually be thwarted or removed. Unlimited wealth means unlimited political donations which means laws and policies that favor the rich. It’s a game of cat and mouse that will only end when the megarich have consolidated power and there are no more mice.
Joe Ragazzo is TPM’s publisher.
So what is the remedy?
welcome macmbr
Money is not speech.
Anonymous or otherwise.
What’s the cutoff? What is the threshold that have ‘too much money’ so you’re now a public enemy? Who decides?
That’s not “shuffling deck chairs on the Titanic” unless you believe that we’re doomed.
The entire op ed was a Bernie campaign speech–much complaining but zero depth and no (realistic) solutions.
Some here at TPM think Bloomberg is the answer.
Some think we cant afford nice things. It seems Democrats like to talk about Healthcare, SS, Medicare, immigration, living wages, affordable housing, education. Bring it up in a debate and suddenly we cant afford it. Every candidate except Warren and Sanders says so.
Democrats have been telling us the same story since I have been politicaly aware, they niether shit nor get off the pot.
I agree with the article, but it’s missing another big problem with billionaires that is purely economic rather than moral - they own a lot of money that does not get spent, and the purpose of dollars in a capitalist economy is to be spent. Money that is being shoveled hand over fist to wealthy individuals and corporations used to be used not only for federal programs, but to subsidize state a local services. In order to make up for those losses, towns have to raise property taxes and sales taxes. These ultimately drive people away who can afford to make choices, so we see a downward spiral in some communities from which they will never recover. In the kind of mobile society we have today, it is next to impossible for smaller towns to accurately budget even 10 or 20 years out. This is one of the reasons we live in a country rather than individual fiefdoms. Countries are supposed to help keep small, economically volatile areas more stable rather than continue sapping wealth from them.