Bill Moyers described this week a central conclusion of an essential new book, Capital in the Twenty-First Century, by the French economist Thomas Piketty. "[We] are heading into a future dominated by inherited wealth as capital concentrates in fewer and fewer hands, giving the very rich ever greater power over politics, government, and society. 'Patrimonial capitalism' is the name for it [plutocracy is another], and it has potentially terrifying consequences for democracy. For those who work for a living, the level of inequality in the US, writes Piketty, is 'probably higher than in any other society, at any time in the past, anywhere in the world.' Over three decades, between 1977 and 2007, 60 percent of our national income went to the richest 1 percent of Americans. No wonder this is the one book the 1 percent doesn't want the other 99 percent to read."
Paul Krugman, who is interviewed by Moyers, adds in his reading of Piketty: "We're rapidly moving towards a state where inherited wealth dominates. I didn't know that. I really was — I should've known it. I should've thought about it, but I didn't. And so then here comes this book with — I mean, it's beautiful — absolutely analytically beautiful, if that makes any sense at all.... You're talking about a situation in which dynasties come increasingly to dominate the top of the economic spectrum and a tiny fraction of the population ends up very dominant... Teddy Roosevelt could’ve told you and did: — when you have a few people who are so wealthy that they can effectively buy the political system, the political system is going to tend to serve their interests. And that is going to reinforce this shift of income and wealth towards the top.... "
Bill Moyers concludes:
"The evidence keeps mounting. Just this past Tuesday, the 15th of April, Tax Day, the AFL-CIO reported that last year the chief executive officers of 350 top American corporations were paid 331 times more money than the average US worker. Those executives made an average of $11.7 million compared to the average worker who earned $35,239.
"As that analysis circulated on Tax Day, the economist Robert Reich reminded us that in addition to getting the largest percent of total national income in nearly a century, many in the one percent are paying a lower federal tax rate than a lot of people in the middle-class. You will, no doubt, remember that an obliging Congress, of both parties, allows high rollers of finance the privilege of carried interest, a tax rate below that of their secretaries and clerks. And at state and local levels, while the poorest 20 percent of Americans pay an average tax rate of over 11 percent, the richest one percent of the country pays half that rate. Now, neither nature nor nature’s God drew up our tax codes. That’s the work of legislators, politicians, and it’s one way they have, as Chief Justice John Roberts might put it, of expressing gratitude to their donors. Oh, Mr. Adelson, we so appreciate your generosity that we cut your estate taxes so you can give $8 billion as a tax-free payment to your heirs, even though down the road the public will have to put up $2.8 billion to compensate for the loss in tax revenues.
"All of which makes truly repugnant the argument, heard so often from courtiers of the rich, that inequality doesn’t matter. Of course it matters. Inequality is what has turned Washington into a protection racket for the one percent. It buys all those goodies from government: tax breaks, tax havens, allowing corporations and the rich to park their money in a no-tax zone, loopholes, favors like carried interest, and on, and on, and on.
"Listen, there’s a big study coming out in the fall from Martin Gilens at Princeton and Benjamin Page at Northwestern, based on data collected between 1981 and 2002. Their conclusion, quote, “… America’s claims to being a democratic society are seriously threatened … the preferences of the average American appear to have only a minuscule, near-zero, statistically non-significant impact upon public policy.”
"Sad, that it’s come to this. The drift toward oligarchy that Thomas Piketty describes in his formidable book has become a mad dash, and it will overrun us, and overwhelm us, unless we stop it."
The weakness of Moyers' program is that he doesn't take time with Krugman to ask "How?" How do we stop the drift toward oligarchy, or plutocracy, before it overwhelms us?