According to the textbooks, to say nothing of the First Amendment, the job of the journalist is to expose these arrangements. And this does happen. But it is rare. Far more frequently, we find journalists running interference for the people behind these schemes, sometimes ignoring the central role that money plays in pretty much every calculation, and sometimes attempting to sell the notion that all this is actually a good thing.
For decades, with virtually nobody in the mainstream media even noticing, the wealthiest 1/100th of 1 percent of Americans were able to use their financial power to induce Congress to rewrite the rules of our nation’s social and economic order. Today, however, thanks to the economic crisis of 2008, coupled with the surprising success of Occupy Wall Street, it is increasingly difficult to avoid seeing the fruits of their efforts.
The income of the top 1 percent of Americans increased by 256 percent between 1979 and 2006, while the lowest quintile saw its income rise by an average of just 11 percent during the same period. As the Nobel laureate economist Joseph Stiglitz has noted, this same 1 percent now enjoys almost “a quarter of the nation’s income every year. In terms of wealth rather than income, the top 1 percent control 40 percent…. Twenty-five years ago, the corresponding figures were 12 percent and 33 percent.” What’s more, while the party in the penthouse grows more and more decadent, the ladder upstairs is being pulled out for the folks who might like a hand up. Recent studies have found a much lower level of social and economic mobility than exists in countries that are our economic competitors. According to a 2006 study, 42 percent of American men raised in the bottom fifth of incomes stay there as adults. This is a much higher rate than those of the allegedly class-stratified nations of Europe: Denmark’s level is only 25 percent, while terrible old Great Britain’s is just 30 percent. Roughly 62 percent of Americans (male and female) raised in the top fifth get to stay in the top two-fifths. Likewise, 65 percent of those born in the bottom fifth stay in the bottom two-fifths.
One can see the manner in which the system operates in anecdotal evidence, too. Check out the entertainment news this week and you’ll see that Marvel’s The Avengers had a $207 million opening weekend in the United States—the largest in film history. How is it, then, that New Mexico’s politicians had to subsidize the film’s producers to the tune of $22 million in tax credits?
Lately Facebook has dominated much of the news owing to its IPO, Mark Zuckerberg’s wedding and Eduardo Saverin’s renunciation of his US citizenship. How much of the coverage has focused on the fact that these newly minted billionaires and multimillionaires will not only be able to avoid billions of dollars in taxes, but the rest of us taxpayers are actually going to end up owing them money? According to Citizens for Tax Justice, “When, as Facebook expects, the 187 million stock options are cashed in this year, Facebook will get $7.5 billion in tax deductions (which will reduce the company’s federal and state taxes by $3 billion). According to Facebook, these tax deductions should exceed the company’s U.S. taxable 2012 income and result in a net operating loss (NOL) that can then be carried back to the preceding two years to offset its past taxes, resulting in a refund of up to $500 million” (italics in original).
Perverse as they may be, such policies are no accident. Rather, they are the result of careful behind-the-scenes deal-making between corporate lobbyists and their (not our) representatives in Congress. Columbia University political science professor Robert Lieberman, writing in Foreign Affairs, noted that in the 1990s the Financial Accounting Standards Board attempted to curtail the practice of allowing corporate CEOs to compensate themselves with massive stock-option packages, which the FASB said would encourage deceptive accounting practices. “But Congress, spurred on by the lobbying efforts of major corporations, stopped the FASB in its tracks,” writes Lieberman. As a consequence CEOs have been able to enrich themselves at the expense of employees and stockholders “through the mutual back-scratching habits of corporate boards.”
With most members of the media ignoring all this, we are greeted instead by articles like the recent cover story in the New York Times Magazine, a profile of Mitt Romney’s former Bain colleague Edward Conard, who believes that “having a small elite with vast wealth is good for the poor.” In the arguments of media apologists for the super-wealthy using their money to game the political system, there is only what the telegenic lunatic Monica Crowley calls the “class-warfare, Obama-esque freak-out…. Pitting Americans against each other, pitting the 1 percent against everybody else, casting those who are wealthier as not paying their fair share. Going against private jet owners, those who fly in private jets, millionaires and billionaires.” I have no idea what Fox pays Crowley to deploy her Columbia University international affairs PhD on behalf of such obvious nonsense, but whatever it is, it’s chump change compared with what her corporate overlords enjoy as they share a laugh together on their private jets about how happy she and her fellow hacks are to sell themselves for a salary that, in all likelihood, doesn’t even land them outside the new lumpenproletariat—or, as her friends would put it, “the 99 percent.”
Original Article
Source: the nation
Author: Eric Alterman
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