Money Talks, Media Balks

The real story this election season is the wealthy buying up our political system, writes Eric Alterman.

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Critics of <i>Citizens United</i>, which paved the way for an enormous influx of money into this year's political cycle, hold signs during a gathering on the anniversary of the ruling. (AP/ Toby Talbot)
Critics of Citizens United, which paved the way for an enormous influx of money into this year's political cycle, hold signs during a gathering on the anniversary of the ruling. (AP/ Toby Talbot)

Three related phenomena are today combining to strangle American democracy.

The first is the explosion of economic inequality and the increasing gulf between the top 1 percent of taxpayers—who average significantly more than $1 million in annual income—and everyone else in America. The second is the opening of the floodgates to the influence of that same explosion of outsized wealth on our politics. Both problems have worsened considerably in just the past couple of years and now threaten to turn America’s already imperfect democracy into a political system much closer to an oligarchy.

Yet there is a third and equally disturbing factor contributing to the erosion of our democracy, and that’s the media’s failure to put these changes at the center of their election narrative.

Let’s start with the income disparities. Recently released government economic statistics covering 2010, the first year of real recovery from the financial collapse of 2008, found that fully 93 percent of additional income gains coming out of the recession went straight into the wallets and purses of the top 1 percent. Even more alarming were the buckets of cash pouring into the swimming pools, saunas, and other receptacles enjoyed by the top 1 percent of the 1 percent. Those folks at the very pinnacle of the financial food chain—who average nearly $24 million a year in income—captured fully 37 percent of this rise. As for the rest of us—the bottom 99 percent—we saw our income rise by less than a hundred bucks, not even enough to cover a tip at Le Bernadin these days.

As Jacob Hacker and Paul Pierson illustrate in their book, Winner-Take-All Politics, this exploding wealth inequity is the result of deliberate policy choices made by politicians in the service of those who fund their campaigns. During the nation’s economic recovery under the watch of former President Bill Clinton, the 1 percenters took roughly half as much of the country’s economic gains as they’re enjoying today. That number increased to about two-thirds during Bush’s presidency. These trends were damaging enough to the fabric of our democracy, but during Bush’s terms Congress repeatedly cut tax rates on top earners along with capital gains and estate taxes.

Columbia University political scientist Robert C. Lieberman, writing in Foreign Affairs, also notes that in the 1990s the Financial Accounting Standards Board, which regulates accounting practices, attempted to put a stop to the practice of allowing corporate CEOs to compensate themselves with massive stock-option packages. The board correctly predicted that it would lead to an epidemic of deceptive accounting practices. “But Congress, spurred on by the lobbying efforts of major corporations, stopped the FASB in its tracks,” wrote Lieberman.  As a consequence CEOs have been able to enrich themselves at the expense of employees and stockholders “through the mutual backscratching habits of corporate boards.”

The ability of the 1 percent to buy politicians and regulators is nothing new in American politics—just as inequality has been a permanent part of our economic system. This is true of virtually all political and economic systems. But instead of seeking remedies to this ongoing problem, the putative guardians of our democratic principles, rights, and responsibilities—the United States Supreme Court—has chosen to vastly exacerbate the situation.

Led by Chief Justice John Roberts, the Court has chosen to ignore its predecessors’ understanding that tons of corporate cash flooding the political system would likely—as noted in the 1990 Supreme Court case Austin v. Michigan Chamber of Commerce —result in “corrosive and distorting effects” on American politics when designed “to influence unfairly election outcomes.” Even “the appearance of corruption in the political arena” was deemed in the Austin ruling to offer sufficient reason to curb corporate political spending.   

Yet in its 5-to-4 ruling in Citizens United, the Roberts Court somehow decided that “the people have the ultimate influence over elected officials,” and so none of this corporate spending mattered. Justice Anthony Kennedy, writing for the majority, went so far as to argue that this flood of independent spending does “not give rise to corruption or the appearance of corruption” and “influence over or access to elected officials does not mean that these officials are corrupt.”

The effect of this disastrous decision was magnified by the ruling in v. Federal Election Commission, in which the U.S. Court of Appeals for the District of Columbia, ruled that corporate contributions to so-called 527s (political action committees) could not be limited for any reason, a ruling confirmed by the Federal Election Commission.

Of course, the folks doling out the cash to buy what they want from our political system are not eager to discuss the practice in public. They even compare themselves to the character played by Brad Pitt in the film, “Fight Club,” demanding that participants “clam up” about their secret meetings.  In this case what is being kept on the down low is the degree to which these political influence buying efforts are coordinated, often under the auspices of Bush administration consigliore, Karl Rove.

One can readily see the results of these trends in any number of areas, yet democracy’s watchdog—the media—has barely issued a yelp in protest. The Washington Post, for instance, reports that millions of dollars are pouring into Wisconsin from wealthy conservatives nationwide to thwart the efforts of labor unions who too are preparing to pump big money and other resources into the campaign to recall the union-busting Republican governor, Scott Walker.  

The funny thing about the article, however, is it contains no evidence of any money “pouring in” from anyone but conservatives.  We read of  “millions” being spent for TV ads for Walker, including “more than $700,000 already from one group, Americans for Prosperity, which was founded by David and Charles Koch, the ubiquitous funders of conservative causes.”

Gov. Walker, it turns out, has already “raised more money — $12.1 million and counting — than he did during his entire 2010 campaign,” not withstanding the fact that that his opponent has yet to be named. What’s more, “Thirteen of Walker’s top 20 donors are from out of state, from places such as Texas, New York, and Wyoming.”

Despite the offhand mentions of all of the above, the Post article focuses instead on a small right-wing organizer and Glenn Beck fan named Ross Brown instead of the truly big money donors. It downplays the real story of the purchasing of our political system by the wealthy in favor of a commitment to a phoney-baloney “on the one handism,” which treats (as yet unenumerated) union contributions as somehow equivalent to those of the out-of-state billionaires, and provides no data, no comparison, and no means for the reader to understand the disparity between the two sides. 

Yet again, big money is buying what it wants in Wisconsin and across this country, with the aim of squeezing the poor and middle class even further out of the political process now and into the future. That is the true story of the 2012 election. The fact that money is increasingly able to dominate our politics, culture, and society would not have been possible without the tacit complicity of the so-called liberal media, which has failed and continues to fail to put such stories at the center of their political narrative where it belongs.

Eric Alterman is a Senior Fellow at the Center for American Progress and a CUNY distinguished professor of English and journalism at Brooklyn College. He is also “The Liberal Media” columnist for The Nation. His newest book is The Cause: The Fight for American Liberalism from Franklin Roosevelt to Barack Obama, to be published in April. This column won the 2011 Mirror Award for Best Digital Commentary.

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Eric Alterman

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