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The Era of the ‘1 Percent’

The megawealthy are tightening their grip on politics and power, writes Eric Alterman. How will progressives respond?

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A protester is taken into custody after several arrests where made near Wall Street and Broadway after Occupy Wall Street march on October 5, 2011, in New York. (AP/Craig Ruttle)
A protester is taken into custody after several arrests where made near Wall Street and Broadway after Occupy Wall Street march on October 5, 2011, in New York. (AP/Craig Ruttle)

Whether one agrees or disagrees with the tactics of the Occupy Wall Street movement, it’s easy to understand the inspiration for its anger as well as its impatience.

“Historical movements,” the historian Mary Jo Buhle rightly notes, “are rarely judged solely in the light they cast themselves.” In that sense it is a decidedly risky business to try to draw too many hard and fast conclusions about the present moment in history. Even so, I think the Nobel laureate economist Joseph Stiglitz was as accurate as anyone is likely to be when he pronounced our age—and our government—to be one “of the one percent, by the one percent, for the one percent.”

Think about it: In 1974 the top 0.1 percent of American families enjoyed 2.7 percent of all income in the country. By 2007 this same tiny slice of the population had increased its holdings to fully 12.3 percent—roughly five times as great a piece of the pie as it had enjoyed just three decades earlier. Half the U.S. population owns barely 2 percent of its wealth, putting the United States near Rwanda and Uganda and below such nations as pre-Arab Spring Tunisia and Egypt when measured by degrees of income inequality.

Over one in five American children is living in poverty, and the number is rising. By the end of 2010, corporate profits rose by fully 15 percent of the economic pie—their biggest share of the economy since such statistics became available nearly 70 years earlier—while the share going to workers’ wages dropped to their lowest level in the same period and fell below 50 percent of national income for the first time.

It’s difficult, however, to imagine a time in our politics when our system is so unbalanced in this direction. According to the political scientists Jacob Hacker and Paul Pierson, for instance, the number of political action committees grew from under 300 in 1976 to nearly 5,000 by 2010. The degree of funds these PACs control and direct toward politicians of both parties on issues of concern has the power to overcome almost any group of voters who attempt to organize themselves in opposition.

Americans have always evinced some distrust of government, but the current situation has exacerbated this to a degree that may be unprecedented. A CNN/ORC International poll published on Wednesday found that fewer than one in seven Americans questioned trusted the government “to do what’s right almost always or most of the time,” an all-time low since University of Michigan pollsters began asking the question in 1958. This was approximately the same anemic percentage of those questioned who, in a previous poll taken last year (subscription required), expressed confidence in the government’s “ability to stand up to vested interests.”

A related problem is a lack of trust in elites: Citizens do not believe that the programs politicians propose will last or make any difference if they do last, and they do not vote in their own interests because all they see are the likely costs.

The governing style of the Obama administration only reinforced these beliefs. As the Democratic pollster and political scientist Stanley Greenberg wrote in July 2011:

The government saved irresponsible executives who bankrupted their own companies, hurt many people and threatened the welfare of the country. When Mr. Obama championed the bailout of the auto companies and allowed senior executives at bailed-out companies to take bonuses, voters concluded that he was part of the operating elite consensus.

Never have liberals needed to stand up stronger on behalf of their constituency. But the fact remains that on the economic front, they find themselves on the defensive in virtually every respect. Liberalism, much like President Obama at the outset of his presidency, was torn between commitments to preserve the necessary civility in political life and a desire to pursue substantive values of justice and equity. Based on the success conservatives have enjoyed with arguments like “death panels,” “socialism,” and “Sharia law” (to say nothing of the near default of the U. S. government) the president has succeeded in neither respect.

Today liberalism has pledged itself to rationality in a culture in which the anti-intellectualism initially identified by the historian Richard Hofstadter has run rampant across the entire political culture. Its practice, the philosopher Michael Walzer observed, “is a hard politics because it offers so few emotional rewards; the liberal state is not a home for its citizens; it lacks warmth and intimacy.”

Lacking universal foundations—Lionel Trilling termed it “a large tendency rather than a concise body of doctrine”— liberalism can offer only narratives of sacrifice and common purpose, ones that can easily be trumped by the tales of the right, which frequently combine libertarianism with jingoism, fearmongering, and other easily pushed emotional buttons that tend to drown out the more idealistic homilies that liberals put forth.

As Hofstadter feared nearly 60 years ago, “In a populistic culture like ours, which seems to lack a responsible elite with political and moral autonomy, and in which it is possible to exploit the wildest currents of public sentiment for private purposes,” it would be “at least conceivable that a highly organized, vocal, active, and well-financed minority could create a political climate in which the rational pursuit of our well-being and safety would become impossible.”

“We can have democracy in this country, or we can have great wealth concentrated in the hands of a few,” the great liberal jurist Louis Brandeis prophesied in the second decade of the 20th century. “But we can’t have both.”

Conservatives have made their choice. It’s long past time for liberals to make theirs.

Eric Alterman is a Senior Fellow at the Center for American Progress and a Distinguished Professor of English at Brooklyn College and the CUNY Graduate School of Journalism. He is also a columnist for The Nation, The Forward, and The Daily Beast. His newest book is Kabuki Democracy: The System vs. Barack Obama. This column won the 2011 Mirror Award for Best Digital Commentary.

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