The Plutocracy is already here

How often have you heard people complain “Why doesn’t government reflect the views of the people?” Or put another way, why doesn’t government enact laws that a majority of Americans clearly support and desire? (i.e.,  raise the minimum wage, comprehensive immigration reform, etc.)

How is it that politicians do not represent the interests of the majority of American citizens? The answer is simple: money.

The vast majority of Americans do not contribute money to politicians, and politicians listen to the people who do contribute to their campaigns. broke down total campaign contributions in 2012, Donor Demographics:

Only a tiny fraction of Americans actually give campaign contributions to political candidates, parties or PACs. The ones who give contributions large enough to be itemized (over $200) is even smaller. The impact of those donations, however, is huge.

Screenshot from 2014-04-05 16:41:00

The Sunlight Foundation breaks down this elite “donor class” even further. The Political 1% of the 1% in 2012:

More than a quarter of the nearly $6 billion in contributions from identifiable sources in the last campaign cycle came from just 31,385 individuals, a number equal to one ten-thousandth of the U.S. population.

In the first presidential election cycle since the Supreme Court’s decision in Citizens United v. FEC, candidates got more money from a smaller percentage of the population than any year for which we have data, a new analysis of 2012 campaign finance giving by the Sunlight Foundation shows. These donors contributed 28.1 percent of all individual contributions in the 2012 cycle, a record high.

One sign of the reach of this elite “1% of the 1%”: Not a single member of the House or Senate elected last year won without financial assistance from this group. Money from the nation’s 31,385 biggest givers found its way into the coffers of every successful congressional candidate. And 84 percent of those elected in 2012 took more money from these 1% of the 1% donors than they did from all of their small donors (individuals who gave $200 or less) combined.

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The nation’s biggest campaign donors have little in common with average Americans. They hail predominantly from big cities, such as New York and Washington. They work for blue-chip corporations, such as Goldman Sachs and Microsoft. One in five works in the finance, insurance and real estate sector. One in 10 works in law or lobbying. The median contribution from this group of elite donors? $26,584. That’s a little more than half the median family income in the United States.

Forbes magazine, oddly enough, asks the right question: Are The Views Of America’s Wealthiest Undermining Democracy?:

Is there an oligarchy in the United States that makes important political decisions for the rest of the country? According to a new paper by professors at Northwestern and Vanderbilt, the top one-tenth of one percent of the wealthiest people in the U.S., those who have assets worth $40 million or more, hold undue sway over the positions politicians take on issues ranging from health care to global warming to defense spending. The wealthiest Americans, contends the paper, are more conservative than the public as a whole on many issues, and U.S. public policy reflects that.

The paper, published in the March issue of the journal Perspective on Politics and covered by blogger and Bloomberg contributor Barry Ritholtz, was written by Benjamin Page and Jason Seawright of Northwestern, and Larry Bartels of Vanderbilt. They set out to poll a sample of the wealthiest Americans in the Chicago area.

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The just-published paper reports on findings from a SESA pilot study compiled in the Chicago area in the winter and spring of 2011. Through cross-referencing several lists, the researchers believe their sample represents the wealthiest one-tenth of 1%, or those with more than $40 million in assets. They wound up doing interviews, each lasting around 45 minutes, with 104 very wealthy people. It’s a small sample size from one region of the country, but the results are intriguing. Those polled tend to be very active in politics with 68% contributing an average of $4,600 to political campaigns in the last year and 99% voting, compared to the 58% of the general population that turns out for federal elections. A striking 21% of survey respondents “bundled” other people’s political contributions, not something ordinary Americans do. Many of the respondents said they were on a first-name basis with local politicians . . .

When the researchers asked respondents to prioritize 11 different issues, including education, terrorism and child poverty, the greatest share, 87%, said they cared most about budget deficits. Many also said they cared about unemployment and education, but only 11% said those issues were the most important facing the nation. The least important issue, according to those polled: global warming.

Though the researchers didn’t poll average Americans, they made use of general population surveys from organizations like Gallup and CBS . Example: a CBS survey found that only 7% mentioned the budget deficit as the most important problem facing the country. Another general population study revealed that 68% of the general public believed the government “must see that no one is without food, clothing or shelter.” Only 43% of the very wealthy agreed with that statement. Not surprisingly, when asked whether the government should redistribute wealth by imposing heavy taxes on the rich, only 17% of the ultra-wealthy liked that idea while a 2009 Gallup poll showed that 52% of the general population did.

Some more findings: Only 40% of the very wealthy want to raise the minimum wage, versus 68% of the general public, just 13% of the wealthy want to raise the Earned Income Tax Credit, versus 49% of the public. Not surprisingly, the rich want to lower estate taxes and they don’t want to raise taxes on high-income earners. They oppose heightened regulation of Wall Street, the health care industry, small business and especially big corporations.

The authors’ conclusion: “there is no question that the views of the very wealthy in this study conflict with the beliefs of the general population.”

If the polling results of the pilot hold true across the nation, then it’s clear that the very wealthy hold different political views from the general public. It also seems clear that the one-tenth-of-the 1% has greater political power than ordinary citizens and that they are backing policies that only some of us support.  That “raises a serious challenge to a core democratic value, i.e., the idea that government policymaking should be attentive to the interests of all citizens.”

The conservative activist policies of an unelected U.S. Supreme Court legislating from the bench is making this situation even worse, undermining democracy and ushering in the plutocracy.

UPDATE: Wesley Lowery at the Washington Post adds, 91% of the time the better-financed candidate wins. Don’t act surprised.:

Take a look at the chart below, created last month by Jasper McChesney, a designer at United Republic, a nonpartisan nonprofit that tries to spread awareness about the influence of money in politics.

The chart analyzes 467 congressional races held in 2012. Its findings:

* Candidates who out-fundraised their opponents were nine times more likely to win elections in 2012.

* Winning congressional candidates outspent their opponents by about 20 to 1.

* Winning candidates on average spent $2.3 million. Losing candidates, on average, spent $1.1 million.


5 thoughts on “The Plutocracy is already here”

  1. It is obvious that a person who donates more than another has more influence than non-donors or other donors but the issue is whether or not that extra influence can tip an election. If it cannot, it is wasted money.
    Many factors are at play, such as what percentage of the campaign funding comes from the big donor, how does the public feel about the candidate or issue, who is the opponent, district registration, voter turnout, off-year or presidential year, if an off-year, the popularity of the president and much more.
    That is what I mean by too simplistic.

    • Then we agree on the complexity and that there are many moving parts that factor in to the equation. But it is not just access and influence, it is reward: your readiness to give GEO Group a $900,000 gift in the budget just for the asking is a good example. The average citizen who wants increased funding for education and health care is told that “we cannot afford it.”

  2. I am sure you are very proud of being a sponsor of SB 1070 along with your good buddy Russell Pearce. As I recall, the organized business community (chamber organizations) did not spend money or organize to oppose the bill as they did recently against the Religious Bigotry bill, SB 1062. They played a cynical game: they supported Republicans for office to get the tax breaks they always want, and would try to “contain the crazy” later.

    This is exactly what happened. They got a GOP supermajority in 2010 which gave them the tax cuts they wanted, but when the legislature sought to pursue more anti-immigrant bills they made it clear that this was no longer acceptable, reining in the crazy from you and your anti-immigrant cohorts.

    As for Medicaid expansion, Democrats do not have to be bought off for something they believe in on a philosophical and sound public policy basis. As I recall, you and your anti-expansion cohorts accused the Republicans who voted for Medicaid expansion of being RINOs who sold out to the hospital and medical associations that wanted passage to stop the bleeding from charity care at emergency rooms. It was the fiscally responsible thing to do.

    It is you who seeks to simplify what is always complex multiple moving parts.

  3. So Mr. Kavanagh, you want to deny that big money from a few people doesn’t have outsized influence in politics today?

  4. How do you explain the passage of SB1070 and Arizona’s pro 2nd amendment bills that most big money donors and business interests opposed.

    Also, was the passage of the Medicaid expansion a victory of money interests (health care interests) who bought off Dems? I do not think so.

    This theory is too simplistic.

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