“It is easier to be rich in America than in Europe, because Europeans envy the billionaire, but Americans hope to emulate him.”-- George Soros
“The poor man really has a stake in the country. The rich man hasn’t; he can go away to New Guinea in a yacht.”-- G. K. Chesterton
Over the past year, there has been a lot more discussion in the media about the dramatically growing inequality and economic polarization that we have been seeing in these interesting times. I have not touched it too much, because I do not want to regress to my undergraduate days and constantly spew epithets such as “plutocrats!” However, I have come upon a good long-form essay by
Chrystia Freeland titled “The Rise of the New Global Elite” that gives us a good overview of the issues that are shaping our socioeconomic world. For starters, let’s take the term “plutonomy,” which Freeland gets from a Citigroup analysis:
In a plutonomy there is no such animal as “the U.S. consumer” or “the UK consumer”, or indeed the “Russian consumer”. There are rich consumers, few in number, but disproportionate in the gigantic slice of income and consumption they take. There are the rest, the “non-rich”, the multitudinous many, but only accounting for surprisingly small bites of the national pie.
Freeland then goes on to flesh that out a little:
Our light-speed, globally connected economy has led to the rise of a new super-elite that consists, to a notable degree, of first- and second-generation wealth. Its members are hardworking, highly educated, jet-setting meritocrats who feel they are the deserving winners of a tough, worldwide economic competition—and many of them, as a result, have an ambivalent attitude toward those of us who didn’t succeed so spectacularly. Perhaps most noteworthy, they are becoming a transglobal community of peers who have more in common with one another than with their countrymen back home. Whether they maintain primary residences in New York or Hong Kong, Moscow or Mumbai, today’s super-rich are increasingly a nation unto themselves.
Freeland is not a lefty radical calling for the arming of the proletariat and lower-level bureaucrats. In her critical account, she also gives us what she takes to be virtues of this new global super-elite. She notes that a lot of the new big players are self-made men, which she offers may also help to explain the coldness that they feel toward the great many of us that are left behind: “If we can do it, why can’t you?” And she argues that they are a hard-working, brilliant lot, citing this statistic by Emmanuel Saez: “He has found that in 1916, the richest 1 percent of Americans received only one-fifth of their income from paid work; in 2004, that figure had risen threefold, to 60 percent.” Personally, if a lot of this is drawn from financial and speculative work, I would be doubtful about calling it actual work, but it does convey the feelings and attitudes of righteousness that this new elite maintain about themselves as the “working rich.”
Now, if these lords of the global economy do not think much of government nor of the falling fortunes of the middle-class, they do value the self-image of being the benefactors to a needy humanity. Instead of using the traditional institutions of charity, they create their own foundations and use their private means to address big problems in what has been dubbed “philanthrocapitalism.” Though I agree with
Poovanna in thinking that they would do better to pay their fair share of taxes. It only looks nasty to hear every day of big budget cuts to needed government programs while the big financial institutions and transnational corporations draw ever larger profits. As Freeland concludes:
The lesson of history is that, in the long run, super-elites have two ways to survive: by suppressing dissent or by sharing their wealth. It is obvious which of these would be the better outcome for America, and the world. Let us hope the plutocrats aren’t already too isolated to recognize this. Because, in the end, there can never be a place like Galt’s Gulch.
( an extended exerpt more )