Why Are the Super-Rich So Angry?

[onehandle]

The past few years have been very good to Stephen Schwarzman, the chairman and C.E.O. of the Blackstone Group, the giant private-equity firm. His industry, which relies on borrowed money, has benefitted from low interest rates, and the stock-market boom has given his firm great opportunities to cash out investments. Schwarzman is now worth more than ten billion dollars. You wouldn’t think he’d have much to complain about. But, to hear him tell it, he’s beset by a meddlesome, tax-happy government and a whiny, envious populace. He recently grumbled that the U.S. middle class has taken to “blaming wealthy people” for its problems. Previously, he has said that it might be good to raise income taxes on the poor so they had “skin in the game,” and that proposals to repeal the carried-interest tax loophole—from which he personally benefits—were akin to the German invasion of Poland.

Schwarzman isn’t alone. In the past year, the venture capitalist Tom Perkins and Kenneth Langone, the co-founder of Home Depot, both compared populist attacks on the wealthy to the Nazis’ attacks on the Jews. All three eventually apologized, but the basic sentiment is surprisingly common. Although the Obama years have been boom times for America’s super-rich—recent work by the economists Emmanuel Saez and Thomas Piketty showed that ninety-five per cent of income gains in the first three years of the recovery went to the top one per cent—a lot of them believe that they’re a persecuted minority. As Mark Mizruchi, a sociologist at the University of Michigan and the author of a book called “The Fracturing of the American Corporate Elite,” told me, “These guys think, We’re the job creators, we keep the markets running, and yet the public doesn’t like us. How can that be?” Business leaders were upset at the criticism that followed the financial crisis and, for many of them, it’s an article of faith that people succeed or fail because that’s what they deserve. Schwarzman recently said that Americans “always like to blame somebody other than themselves for a failure.” If you believe that net worth is a reflection of merit, then any attempt to curb inequality looks unfair.

That’s not how it’s always been. A century ago, industrial magnates played a central role in the Progressive movement, working with unions, supporting workmen’s compensation laws and laws against child labor, and often pushing for more government regulation. This wasn’t altruism; as a classic analysis by the historian James Weinstein showed, the reforms were intended to co-opt public pressure and avert more radical measures. Still, they materially improved the lives of ordinary workers. And they sprang from a pragmatic belief that the robustness of capitalism as a whole depended on wide distribution of the fruits of the system.

Similar attitudes prevailed in the postwar era, as Mizruchi has documented. Corporate leaders formed an organization called the Committee for Economic Development, which played a central role in the forging of postwar consensus politics, accepting strong unions, bigger government, and the rise of the welfare state. “At the very top, corporate leaders were much more moderate and pragmatic, and, because that’s where national politics were, they were very influential,” Mizruchi said. Corporations supported policies that might have been costly in the short term in order to strengthen the system as a whole. The C.E.D. called for tax increases to pay for the Korean War and it supported some of L.B.J.’s Great Society. As Mizruchi put it, “They believed that in order to maintain their privileges, they had to insure that ordinary Americans were having their needs met.”

http://www.newyorker.com/talk/financial/2014/07/07/140707ta_talk_surowiecki

[liberal N proud]

1. They want it all and they want it now

And they don't want to pay any taxes.

[tk2kewl]

2. "This wasn’t altruism..."

"This wasn’t altruism; as a classic analysis by the historian James Weinstein showed, the reforms were intended to co-opt public pressure and avert more radical measures."

Translation:
"No more communist threat so all you peons can go fuckoff!"

[Brigid]

3. They're scared.

Not hard to figure out.

[kwolf68]

5. Doubt that

I think it's all show. They see a bubbling of populist dissent, but they control the government, m-i complex, wall street, the courts...they run the entire show, and are able to plunder the planet with meager restrictions. They consume massive amounts of wealth while the peasants are fighting for sawdust bread.

The wealthy oligarchy is laughing at us right now because they know the man behind the curtain is not anytime soon to be exposed and the "woe is me" bullshit is nothing but a propaganda campaign to inspire the useful idiots (we can call them Republican voters) to vote against their self-interest and installing the government that will allow corporate fascism to rule over us all...ring that stock bell baby.

[Brigid]

8. Ever hear of "fear-biting?"

It's when a dog acts out aggressively to mask the fact that he's terrified. The elite are smart enough to know the gravy train will not last forever no matter what they do; history teaches that. I really do think they are scared.

[Orsino]

12. They've had a peek at the script...

...and yet feel helpless to change it. All they know is more, more, more, and their excesses are only growing more glaringly obvious. They are cracking down on the media in their usual ways: denigrating their own wealth, promoting the myth of it as virtue, and painting themselves as victims 24/7. It doesn't work well, so much so that major political figures are actually mentioning inequality rather than hushing it up.

[jeff47]

13. Not yet.

At least, IMO they aren't scared yet. They still think they're above everyone else.

If they were scared, half of them would be trying to diffuse the anger. The other half would be trying to crush dissent. The former group is currently very small. Most of them are in the latter group.

[BlummberBee]

4. A good read

Thanks for posting.

[unblock]

6. actually, blame reagan.

reagan pumped up their egos with his whole greed-is-good shtick. they loved it for many reasons, but part of it was that it was a huge ego boost to be seen as the heroes of the economy, the ones practicing "freedom" and our founders' vision, rather than as robber barons or polluters or discriminators.

the poor addicts surrounded themselves with corporate sycophants, fauxsnooze, and republican leaders who honored and blessed them at every turn.

as income inequality presses on to historic levels, more and more people are objecting.

now they are starting to suffer from withdrawal as treatment of the business elite is no longer as overwhelmingly fawning as it used to be.

they are so angry because there is the ever so slight hint that their drug might be taken away, and any addict would react very angrily to that.

[merrily]

20. And Presidents after Reagan. Every one of them.

Gramm, Leach, Bliley; NAFTA; tax breaks for the wealthy; TPP-double secret and fast track, no less.

BTW, before Reagan too. Deregulation started with Nixon and continued in every administration after him. In an interview after his Presidency ended, Carter bragged about his deregulation. For only one thing, there was corporate friendly 1978 revision of the Bankruptcy Code that FDR and Joe Kennedy had devised to nail corporate officers and directors who had driven a company into bankruptcy through negligence or intent. Democratic Congress, too.

The Telecommunications Act (Clinton admin), the final nail in coffin of the fairness doctrine and the end of net neutrality-Obama.

We had anti-trust laws that protected us since T. Roosevelt. One President after another has taken the teeth out of them, so that most of our news now comes from about five mega-corporations. And that's "just" our news.

We had SEC laws and practices and Bankruptcy Act that protected us since the early 1930s, now also all but gone. We had a Great Society effort that was supposed to end poverty and hunger in the US, where there is no excuse for either. Mostly gone .

If you think that was all the work of Republicans and Democrats were just too polite to reverse it, you are mistaken on both counts.

If you are a Democratic politician or working for one or more Democratic politicians, blaming all our current problems come on a man who left office in the beginning of 1991, or on only Republicans serves your interests very well. But, if you are an ordinary American Democrat, I don't think it's in your best interests at all to believe that Democratic administrations have nothing to do with our current problems.

[unblock]

21. certainly, clinton/dlc accepted the power of the rich and big corporations

although the democratic party has always viewed catering to the rich and the corporate world more as a necessary evil or as the price of admission than a worth goal in and of itself. we've been uncomfortable with it, whereas republicans have been whole-hog enthusiasts.

democrats, for the most part, don't go on at length rhetorically kneeling before corporate gods the way republicans do. we simply take their money and give them their loopholes and laws and tweak our lauding of the little guy to hopefully not offend the hand that feeds.

[merrily]

22. As my prior post detailed, not only Clinton. Also, I disagree with

this:

the democratic party has always viewed catering to the rich and the corporate world more as a necessary evil or as the price of admission than a worth goal in and of itself. we've been uncomfortable with it, whereas republicans have been whole-hog enthusiasts.

Depends, though, who you mean by the Democratic Party. If you mean ordinary voters, I disagree. I don't think they began to see catering to the rich as a necessary evil until some of them were brainwashed into so doing. I see those brainwashing efforts on this board every time I'm here.

If you mean politicians I also disagree. I think New Democrats named themselves purposefully. They wanted to disassociate themselves from the reputation FDR, HST and LBJ. (I say reputation because I question whether I have seen FDR and LBJ correctly, but that is for another time.) They are not looking at Wall Street as a necessary evil at all.

Heck, John Edwards got rich on hedge funds--and he was considered the liberal in the bunch. Hillary thinks we should stop bad mouthing Wall Street. Cory Booker too. Chelsea Clinton worked on Wall Street. I could give a lot more examples, but I will just ask you to test out your own statement.

However, Democrats did use to sing a different song and they have a different base than the Republicans. So, they have to dance more than Republicans, who have always been out loud and proud of their love for job creators.

[closeupready]

7. Today's super-rich are, essentially, children who've learned at the hands

of people (both the alive and the recently not) like Michael Bloomberg and Richard Mellon Scaife (and lesser oligarchs like Armand Hammer) that throwing a figurative temper tantrum is effective at winning influence in lawmaking bodies all over the US. They also throw tantrums not because they are simply acting out, but because it worked for earlier, late-20th Century oligarchs, it has continued to work through the Second Great Depression, and - they hope - it will continue working well into the 21st Century, leading to the destruction of Social Security and Medicare.

[Uben]

9. They know the pitchforks are coming.

A country cannot survive if all the wealth is owned by a few. It's a recipe for failure. But, that is exactly what congress is letting happen, probably because most of them are wealthy. I suggest we do the same thing they did after the depression, raise taxes on wealth to a point to where so much wealth cannot be accumulated. 50% tax on all earnings over $1 million/yr and progress that to 80% for earnings over $100 million/yr.

[truedelphi]

10. Probably ninety percent of the top five percent have had to be absolutely perfect

From the moment they took their first breath, until the moment they die.

They need to look perfect, act perfectly, (suck in those negative feelings Bub! Feelings are really a No No! -- unless those negative feelings involve pushing other people around.)

Closeness with another human being? Not really part of the game plan.

Read "The Nanny Diaries" to find out what a ultra rich kid's childhood looks and feels like.

There was an article that came out in Marin County, Calif's "Pacific Weekly" back around 2006. It had to do with affluenza. The author recommended that people in households start doing things together. For instance, instead of husband Jeff driving the girl's to their two hour ballet class, while the wife Tiffany goes to her tennis game, have the wife drive with them.

And of course, in many affluent families, it is the au pair taking the kids places, not the parents.

I often suspected that the whole point of half the activities is so no one in the family unit really has to spend time together. How does a person relate to another person, if emotional availability has never been expressed from one family member to another? With that lack of emotional availability going back generations.

How do designer clothes, luxury cars, and huge empty mansions make up for the lack of human connectedness? I doubt they can. (I have nothing against money - as if it cannot buy happiness, it sure can rent it. But I would be appalled to have had to live my life the way the Ultra Rich do.)

[TBF]

11. They aren't pretending anymore because

globalism has taught them they don't need to. They are the ones without "skin in the game" - with their wealth they can outsource their labor and live anywhere, thus no allegiance to their home country or workers (wherever they might be). It's just them and their money so they can do whatever they want.

[enough]

14. Exactly. And that seems to be the conclusion of the article as well.

snip> last paragraph

If today’s corporate kvetchers are more concerned with the state of their egos than with the state of the nation, it’s in part because their own fortunes aren’t tied to those of the nation the way they once were. In the postwar years, American companies depended largely on American consumers. Globalization has changed that—foreign sales account for almost half the revenue of the S&P 500—as has the rise of financial services (where the most important clients are the wealthy and other corporations). The well-being of the American middle class just doesn’t matter as much to companies’ bottom lines. And there’s another change. Early in the past century, there was a true socialist movement in the United States, and in the postwar years the Soviet Union seemed to offer the possibility of a meaningful alternative to capitalism. Small wonder that the tycoons of those days were so eager to channel populist agitation into reform. Today, by contrast, corporate chieftains have little to fear, other than mildly higher taxes and the complaints of people who have read Thomas Piketty. Moguls complain about their feelings because that’s all anyone can really threaten. ♦

[enough]

15. Exactly. And that seems to be the conclusion of the article as well.

snip, last paragraph>

If today’s corporate kvetchers are more concerned with the state of their egos than with the state of the nation, it’s in part because their own fortunes aren’t tied to those of the nation the way they once were. In the postwar years, American companies depended largely on American consumers. Globalization has changed that—foreign sales account for almost half the revenue of the S&P 500—as has the rise of financial services (where the most important clients are the wealthy and other corporations). The well-being of the American middle class just doesn’t matter as much to companies’ bottom lines. And there’s another change. Early in the past century, there was a true socialist movement in the United States, and in the postwar years the Soviet Union seemed to offer the possibility of a meaningful alternative to capitalism. Small wonder that the tycoons of those days were so eager to channel populist agitation into reform. Today, by contrast, corporate chieftains have little to fear, other than mildly higher taxes and the complaints of people who have read Thomas Piketty. Moguls complain about their feelings because that’s all anyone can really threaten. ♦

[toddwv]

16. The same reason that modern "Christians" think they're oppressed.

They want everything their way. They have little empathy for others and truly believe that they are superior to those beneath them.

[merrily]

19. SBS

Spoiled Brats Syndrome.

[applegrove]

17. Because the psycopaths in the republican

Last edited Thu Jul 10, 2014, 09:21 PM - Edit history (4)

party have been telling them lies about their prowess and importance. So all their secret narratives about being ‘masters of the universe‘ has been seemingly actualized. Because they have life so easy that they might get that empty feeling unless the interconnect to greater world and happily be a little cog, all in it together with all of America, they have been toldu instead things like they ‘are the job creators‘. Which is a lie. It is psychological piracy of one political group over another. The middle class are the job creators. That is the engine. So these rich are fed lies and their heads get big, their hearts small. And then the middle class comes along and says ‘hey, we create the jobs and that is what we should be doing here‘. And the rich feel their big heads, and the accompanying rights to be call job creators, attacked. They feel like they are losing territory. So they go tribal. And it is war. The basic thing is that the psychopaths in the GOP took something from the middle class and gave it to the rich which grew their egos and made them feel extra connected in a way in which they want others to fawn over their brilliance. And the middle class, by doing what they are good at and just being themselves, has seemingly attacked. And it all started with psychopaths spreading lies to the rich that made their heads swell. They truly feel their person was doing nothing different when out of nowhere middle class people and their politicians attacked for no reason. It is about the territory/narratives of people‘s brains.

[merrily]

18. I guess the rw likes Godwin's "law" only selectively.