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article imageOp-Ed: Rise of the super-rich, a global oligarchy takes shape

By Paul Wallis     Jan 3, 2014 in Business
Sydney - The howls over the wealth of the One Percent have masked an observed fact- With the rise of the super-rich, oligarchies, perhaps the most inefficient of all types of government and social structures, are also rising.
Arguably worse is some of the logic which is oozing out of various studies of this phenomenon. A combination of grandstanding and naiveté is missing points with an almost religious dogmatism.
Christian Caryl writes more lucidly in The Age describing the current state of play:
At the same time, the extraordinary permissiveness of US laws on lobbying and campaign financing has allowed wealthy elites to gain immense sway over the political process. Witness the stories about the vast sums of cash spent by conservative business magnates like the Koch brothers; less often discussed, perhaps, are the rich Democrats, such as George Soros, who leverage their wealth to shape policy. Even less visible are the corporations and industrial associations who can purchase politicians and fix legislation to boost their bottom lines.
One recent academic study calculates that 40 per cent of political campaign contributions in 2012 came from one hundredth of 1 per cent of US households. That figure probably reflects the new economic elite's growing awareness of its own political power - not to mention the apathy among other segments of the population who feel increasingly divorced from meaningful participation. The erosion of alternative power centres, such as labour unions, undoubtedly contributes to a sense of rising cynicism and disengagement. It all serves to undermine the promise of America's democratic system.
This isn’t just America. China, Russia, and other nations are similarly affected. In Russia, a grand total of 110 people own most of the wealth, while the average Russian is worth about $10,000. The gap is now astronomical around the world. The three class system is now essentially two classes, separated only by “relative” wealth.
Nor is it historically unusual. The high wealth/high poverty model is a template for massive social disruption. The French Revolution exterminated the aristocracy in the name of egalitarianism. In more recent history the rise of communism can be traced directly to massive social inequalities, particularly in the notorious “distribution of wealth” concept. Communism became popular specifically because of a combination of extreme poverty and extreme wealth.
The historical imagery of the “elite” classes also follows the clichés like lost dogs. In the past, “born to rule” classes are common in fiction and fact. The illusion of superiority and privilege produces hallucinations of invulnerability and a right to dictate to others. The modern virtue of the super-rich is philanthropy, and perceptions of sympathy for the untold billions of super-poor. This is about as close as anyone gets to doing anything.
Class warfare is an ideological platform. “Hating the poor” is another well-worn cliché. During the Occupy protests in Chicago, financiers threw job applications for McDonalds off the top of a building. The anti-healthcare “ideology” is squarely aimed at the poor, not the rich. The nauseating opposition to a minimum wage rise in the US is another case of ideological imagery.
The debate over the merits of egalitarianism, democracy, and similar ideological jingles has also missed another point. The rise of the super-rich coincided with the collapse of world communism. Communism fell, ironically enough, due to financial mismanagement and corruption on a colossal scale. Russia went broke, and staggered through a decade of misery. After which, miraculously, a small group appeared holding all the nation’s assets. This group found ready partners among their former enemies.
In the US, the collapse of the middle class was followed by a new political order. Democracy effectively stopped altogether as Congress was bankrolled by the super-rich. The Republican Party became infested with the Tea Party, funded directly by a Koch Industries offshoot, with a fake “grassroots movement” based sickeningly on images of American patriotism. The Tea Party has since moved into the mainstream, where nothing is ever achieved.
OK, now a few issues:
1. The trouble with the class dichotomy is that neither side can be trusted.
The “conspicuous egalitarians” are historically opportunists. In France, Russia and China they took power for themselves, and if anything forced even less “equality”, economic or otherwise, on the people. They typically make all the right noises for those seeking social justice, and do very little, if anything. They’re politicians to the core, and generally corrupt to the core.
2. The super-rich are dependent on their supports. The farcical side of the image of omnipotent wealth is that with it come massive fraud, corruption and a gravy train loaded with unreliable lackeys. A culture of insiders runs everything, and the very rich find themselves looking for facts. Like the old monarchies, they see what others show them.
O tempora, O mores, O what the hell?
Historical precedents only work to a point in the current scenario. The modern society, in all its inelegant shabbiness, is capable of producing truly hideous things, far beyond the upheavals of the past. A “revolution” in modern terms could be multiple revolutions.
The social system doesn’t work at all any more, and nor does its most basic machinery. There’s nothing to stop anyone replacing it with a “subscriber society”, for example, most likely a plethora disparate economic states and entities.
Bitcoin is an example of the powerlessness of the old systems to manage economics. A global currency sprang up outside the old capital system. Crowd sourced lending (a version of micro-lending with multiple lenders) could easily overtake conventional credit systems. The old economics on which super-wealth is based could simply become obsolete.
In the absence of anything even dimly resembling a working society, community groups could easily become global groups. The original reason for “affordable housing” was that housing wasn’t affordable. It’s simply a matter of who provides the housing, and crowd sourced capital, in whatever form, is quite capable of delivering.
Health could be provided on the same basis. Imagine a health care system based on independent providers and pharmaceuticals sourced at sane prices, using a different profit model? The old pharmaceutical price structure would collapse in seconds.
Food- Why source bad food from iffy suppliers who give you 50% food and 50% additives and GMOs, when you can get real food? Is it possible to do that? Yep. Modern agriculture is technologically decades ahead of the old distribution systems.
Capitalism has become its own worst enemy. The super-rich are just décor on the dunghill. If alternatives are offered, most of the world’s population will have little choice but to use them.
Crime- Why give criminals free room and board, when you can make them pay for their crimes in money or kind? If that’s not a disincentive to crime, what is? They don’t fear death, maybe, but they do fear poverty.
One thing for sure- When societies are extremely economically imbalanced, drastic change always happens. The endless weaknesses in this alleged society are likely to trigger massive movements to better options the minute they become available. About 7 billion people have very little to lose.
The super-rich could wind up owning a scrap yard of the wealth of the past. Dollars could become beads. They could go the way of the old monarchs and plutocrats of ancient Rome and China.
The poor have another enemy that’s much worse- Ignorance. It’s not bliss. It’s a disaster for generations. The failure to look for new options is causing as much poverty as this unworkable, ridiculous society. When the house burns down, you’re supposed to get out of it.
Ironically, there’s one kind of poverty you can’t cure with money- Mental poverty. From the caves to the stars, it’s those with no ideas who get left behind.
That includes smug academics, rhetoric-addicts, and ideologues of all kinds. Think about it, for once, you fools.
This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of
More about one per cent, superrich, Christian Caryl, distribution of wealth
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