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Wealth and the wealthy

Written By: - Date published: 8:28 am, April 22nd, 2014 - 28 comments
Categories: class war, equality - Tags:

Now I’m going to predict we’ll have a few trolls who read the title of this and comment about how this is the politics of envy without bothering to read the actual post. I’m tempted to give a code word somewhere near the bottom and then you can ignore any comment that doesn’t manage to include it…

But here are 2 stories: first, the new head of RBS (one of the UK big banks, now largely owned by the UK taxpayer after bailout) in Britain, but originally from these isles, who intends to live on “only” one million pounds per year.  No massive bonuses, just his salary, which is a cut from the previous CEO.

This is obviously a break from the big willy waving (they’re almost exclusively male) that these CEOs do as they compete for status, and insist on pay packets that have nothing to do with their performance, just about being “better” than the next CEO.  Dollars are divorced from reality, and more and more of the company profit goes to a very select few, not the shareholders (which is how capitalism is meant to work), let alone the workers (who actually make the money…).

There’s a second local example too: the Welshman in charge of the Warehouse has been saying he earns a “ridiculous” amount of money.

These are the examples – as CEO / board salaries grow out of all proportion compared to everyone else – that inspire “maximum wage” ideas.  Be they “no public servant should earn more than the prime minister” (UK), or the French and Swiss proposals to make the highest paid in a company a maximum multiple (15x or 20x) of the lowest paid.

If you’re earning more than half a million each year, the number probably doesn’t affect you that much.  You’re doing it for the challenge (certainly after the first 2 or 3 years after which you don’t need to work…), and the pay is just a status thing of being “better” than others.  Businesses say they have to match salaries to compete, but odds are they don’t.

Meanwhile in the US, 2 professors at Princeton and NorthWestern have gone through lots of research and discovered how much influence various groups have on policy (persimmon). Individuals not in the elite: virtually none.  Pressure groups of large numbers without elite connection: very little.  A few members of the wealthy elite: huge influence.

This is how huge majorities in the US can want gun control – but laws get liberalised, not tightened.

Their conclusion is that the US is not a democracy, but an oligarchy.  You get your vote, but it’s not worth much (and getting less with recent Supreme Court rulings).  You only can get elected with the oligs’ money, and those oligs will want to keep hold of those strings once you’re elected.

It shows how important it is to keep the controls on electoral costs and finances.  So that the people, and not the wealthy, get to keep control of their country.

28 comments on “Wealth and the wealthy”

  1. One Anonymous Bloke 1

    And then there’s this:

    Higher social class predicts increased unethical behavior.

    Seven studies using experimental and naturalistic methods reveal that upper-class individuals behave more unethically … upper-class individuals’ unethical tendencies are accounted for, in part, by their more favorable attitudes toward greed.

  2. Mr Interest 2

    Is this the study you refer to: Higher Social Class Predicts Increased Unethical Behavior

    That’s the finding of a group of studies by researchers at the University of California, Berkeley. The research shows that people of higher socioeconomic status are more likely to break traffic laws, lie in negotiations, take valued goods from others, and cheat to increase chances of winning a prize. The resulting paper, “Higher Social Class Predicts Increased Unethical Behavior,” [PDF] was published last year in the Proceedings of the National Academy of Sciences.

    http://www.openculture.com/2013/07/are-the-rich-jerks-see-the-science.html

    Funny, we are seeing this behavior in a certain Minister for Injustices behavior and one not so Prime minister.

    • One Anonymous Bloke 2.1

      I linked to the research in my comment. The word “this” in the first sentence.

      It’s only one paper, but in a way it comes into the category of “things we already knew” – cf: seven deadly sins, rich men, needles and camels, etc. etc.

      Combine that with an unhealthy dose of the “Just World” fallacy and yes, indeed, Judith Collins and her close friends and family positively leap to mind.

  3. karol 3

    There’s an interesting response in NZ Herald today, to ACT’s latest, get-tough-on-burglary-3-strikes-policy.

    Anna Leask reports that prison may not be a big deterrent burglars.. The article ends with this:

    [frequent burglary victim] Gavin said Act’s policy might not be the way to protect the public from burglars.

    “I’m not sure if prison is the ultimate answer, but it could be part of it. They definitely need some sort of decent education, some rehabilitation.”

    He thought the bigger issue politicians should be addressing was the separation of wealth between rich and poor, which he believed was one of the key drivers of burglary.

    Exactly.

    • aerobubble 3.1

      The ACT parties inevitable goal is to throw citizens in jail for stealing their pizza.

      It was not long ago that prisons where universities for criminals, where a burglar needs to learn their trade and so being caught a third time will just be a fail mark from their professors. No Doctorate for them.

      ACT politics is all about distancing itself from active discussion of government, as the neo-liberal scam is all about doing nothing and calling it a winning methodology, this means when their mates in power do actual govern there’s no way for anyone to say they broke with promises to their constituents. And its through this door that the oligarchs get to pick and choose what government does.

      You see its backward and upside down democracy. Governing by deliberating over separate constituencies competing interests is turned into not governing, not discussing governing and declaring how powerful the masses are in being geniuses to follow the ‘free market’. Only the abdication of the voters power to influence, is the ACT party modus of operation, and is key to their continuing to has such a loud voice.

      And the funny thing is Marx warned them, that if they did seize power, which was so easily available to them, they would look like a bunch of fools as the masses would rise up and squash them like the free loading parasites they really are.

  4. Mr Interest 4

    Look at Nationals fat cat attitude to early education and you can see why the Wealthy on that side of the political fence want to keep the status quo…… Who are the real criminals?

    Poor little sausages….. scared of a bit of Darwinian competition:

    http://bigthink.com/think-tank/learning-starts-at-home Quote:

    In a recent interview, the United States’ foremost educational historian Diane Ravitch told Big Think what really matters when it comes to learning, inside schools and out. Contrary to conventional wisdom, she says, it’s not K-12 teachers who are most responsible for kids’ progress — ages 0-5 are some of the most developmentally important, with continued resonance throughout one’s entire life.

    A report analyzing the data explained that prior to learning to read, write, or calculate, “children must acquire rudimentary skills that serve as stepping stones toward mastery of the more advanced and complex skills.” Some kids learn these skills from parents and siblings before entering school, others learn them at daycare. But some children don’t learn them at all. And “children who have mastered these skills in the preschool years are more likely to learn to read, write, and calculate” earlier and more proficiently than those who haven’t.

    The lesson is clear: any program which seriously intends to promote learning for all will have to start early. Children are already forming their understanding of the world and navigating how they will relate to it as toddlers. END Quote

    A poor education system is a bit like the sea, always different, yet always the same ehhh John

  5. johnm 5

    An Oligarchy is a nation run by and on behalf of private interests with privatisation being the main tool of the process.It can have democratic trappings. Seems like NZ to me! We had a referendum against power co. privatisation: ignored. We have 800,000 persons can’t be bothered to vote.

    A Democracy is a nation run by the people for the people and one sensitive to the people’s will.It places people before profit,not profit before people and ideally should have minimal levels of inequality.Important issues would be settled with referendums.

  6. RedBaronCV 6

    I wonder if the bloke at the warehouse is going to ask for a salary reduction. Shouldn’t be hard to put a paper to the board on that – and maybe suggest a reallocation to other staff.

  7. Gosh, one would think that in a post drawing such outrageous conclusions that the facts backing up the arguments/ claims would be rock solid.

    Like this one-

    This is how huge majorities in the US can want gun control – but laws get liberalised, not tightened. Their conclusion is that the US is not a democracy, but an oligarchy.

    In fact the majority want less gun control, as reported by the extreme left Huffington Post.

    http://www.huffingtonpost.com/2012/07/20/gun-control-polls-aurora-shooting_n_1690169.html

    Kind of blows the whole theory out of the water doesn’t it?

    The US is a Constitutional Republic, not a socialist democracy like most of the West. It has a Constitution that exists primarily to protect the rights of citizens from over powerful govt. That is the force that drives the US situation.

    Shame to see a respected site like The Standard publishing such easily exposed BS.

    • johnm 7.1

      The American Oligarchs control the U$. “An oligarchy is a country that is run for private interests. These private interests–Wall Street, the military/security complex, oil and natural gas, and agribusiness–seek domination, a goal well served by the neoconservative ideology of US hegemony.”

      “Libertarian ideology favors privatization. However, in practice privatization is usually very different in result than libertarian ideology postulates. Almost always, privatization becomes a way for well-connected private interests to loot both the public purse and the general welfare.

      Most privatizations, such as those that have occurred in France and UK during the neoliberal era, and in Greece today and Ukraine tomorrow, are lootings of public assets by politically-connected private interests.

      Another form of privatization is to turn traditional government functions, such as prison operation and many supply functions of the armed services, such as feeding the troops, over to private companies at a large increase in cost to the public. Essentially, the libertarian ideology is used to provide lucrative public contracts to a few favored persons who then reward the politicians. This is called “free enterprise.””

      The U$ is an oligarchy and democratic only in name.

      • johnm 7.1.1


        The wonder is that more Americans are not ticked off about the state of our country than whatever is happening ten thousand miles away. For instance, how come the US Department of Justice is not as avid to prosecute the pervasive racketeering in the US economy as the State Department is for provoking unnecessary wars in foreign lands on the other side of the planet, over matters that have little bearing on life here? This racketeering, by the way, amounts to a war against American citizens.

        I’m speaking especially of the US military racket, the banking and finance rackets, the health care racket and the college loan racket, all of which have evolved insidiously and elegantly to swindle the public in order to support a clique of American oligarchs. In other civilized lands, health care and college are considered the highest priority public goods (i.e. responsibilities of government), and national resources are applied to support them under the theory that bankrupting people for an appendectomy or a bachelor’s degree in electrical engineering is not in the public interest. In our land, that would be considered “socialism.” Instead, we “socialize” the costs of supporting Too Big To Fail banks — so their employees can drive Beemers to their Hamptons summer house parties — and a military machine that goes around the world wrecking one country after another to support a parasitical class of contractors, lobbyists, and bought-off politicians in their northern Virginia McMansions."

      • Redbaiter 7.1.2

        Why are we suddenly ranting about “Libertarian ideology”?

        Libertarians are only a relatively recent event in political history and have little real influence on what goes down in the US.

        The roots of US freedom ideology lie in the Conservative nature of the men who wrote the Constitution, which came into force in 1787. Long before Ayn Rand was even a gleam in her great great great grandfather’s eye.

        The same kind of men wrote the Magna Carta, and most documents that serve as the foundations of liberty in the West.

        Rand was a refugee from Russian totalitarianism and her followers are really Johnny Come Latelys and too tinged with the ideas of Frankfurt school Progressives to be of interest to me and many other Conservatives.

        The US Constitution was written with one basic underlying motive, and that was to prevent the US falling into the grip of tyranny.

        Most tyrants that have evolved in history have sprung from leftist roots. For example Hitler and his National Socialist Worker’s Party, Joe Stalin and his “Worker’s Revolution, and Mao and his “Cultural” revolution. All have the key identifier in that they believed the quickest way to acceptance of their ideology was to kill everyone who opposed it, and use terror to maintain their grip on power.

        A fact that seems to escape most critics of the US is that so many of the human remnants of those fatal times, once they were able to escape, immigrated to the United States.

        You’d think they’d know better than some tenured high salaried university professor biting the hand that feeds him. Who in his ideas seems closer to those despicable old tyrants Hitler & Mao & Stalin rather than the men who wrote the American Constitution and the Magna Carta.

        • johnm 7.1.2.1

          The U$ is an oligarchic tyranny. The constitution means nothing other than lip service to its tyrants. They’re not traditional tyrants but well dressed and smiling ones dishing out meaningless platitudes to the American sheople while they pursue their ruthless ends.Repression is as bad as any old tyranny: 1.Surveillance state 2. Prisons a plenty for those who revolt. 3.Paramilitary police and swat teams 4.U$ citizens can be assassinated if the president considers them terrorists without due process.5.The military can now be employed to put down civil unrest. 6. A war crime state re the invasion of Iraq Could go on and on. 6. A threat to World Peace

          • Redbaiter 7.1.2.1.1

            Actually I agree with a lot of your points, but you seem to overlook the obvious fact that it is Frankfurt School Progressives that are behind most of the measures you example. Their influence over Obama and the Democrats and the Republicans is what has grown the US police state.

            The Constitutionalists in the Tea Party are the only really influential group objecting.

            The militarization of the bureaucracy is a breach in spirit anyway of the Posse Comitatus Act of 1897 (?) passed to prevent the US armed forces being used against its citizens. Proving once again it is the Post Modernists behind the growth of the US Police State.

  8. Phil 8

    Your comments on the US ‘oligarchy’, and the underlying media reporting, are misleading. The paper does not look at the political preferences of ‘oligarchs’ and the super-wealthy specifically, but instead uses the top 10% of income earners as a proxy for this group.

    The top 10%, in US terms, corresponds to an average household income of just under $150,000 p.a. Is this wealthy? Yes. Is this the average income of ‘Oligarchs’? No, nowhere near it.

    I’ve also seen the point made recently that the key battlegrounds of recent presidential elections have been those where voters are by-and-large affluent, well educated, and suburban. These would be the people in the top (or near to top) percentiles, so it wouldn’t surprise me to see politicians tailor their messages to the preferences of these battleground/swing voters.

    • Colonial Viper 8.1

      Yep.

      The “oligarchs” are not the top 10%; they are the top 0.1% in the USA, and probably just the top 0.01%. The Forbes 500 list typifies the US oligarchy.

      The top 10% are certainly quite well off, but in the main they are merely moderately recompensed minions of the oligarchs.

      • blue leopard 8.1.1

        …so if the only policies being represented are those held by the ‘minions of Oligarchs’…doesn’t this mean that it is only views that are in Oligarchs interests that are being represented….or do ‘minions’ get to promote separate views from their masters these day?

  9. Colonial Viper 9

    Their conclusion is that the US is not a democracy, but an oligarchy.

    Hate to say it, but what the hell are these two “professors” on about? The US has ALWAYS been a republic, not a democracy.

    From the very outset, the “Founding Fathers” set up their republic to stymie direct democracy and protect the privilege of white property owning, slave holding men. Which is why originally, only 10% or so of the adult US population was eligible to vote. Woman? No vote. Black? No vote. White and poor? No vote.

    Put in this context, the recent disenfranchisement of the US poor and disappearing middle class is nothing more than a reversion to mean.

    • aerobubble 9.1

      The Americian experiment has always been about pushing a free people to give up their liberty to fools, whether religious, political, criminal or monied. The only real shock is so many Americians know it, yet still pander to the prevailing politics just to stay out of the way. i.e. avoid risk rather than adapt, or worse, target the causes.

      • Colonial Viper 9.1.1

        US mass media is now based on a corporate spun culture of lies and disinformation. It’s very hard for ordinary Americans to even know which way is up any more.

        • Rogue Trooper 9.1.1.1

          up to smile at the camera, down to receive food stamps.

          • Colonial Viper 9.1.1.1.1

            Indeed. I suspect that a lot of people in the US are picking up on some major incongruities between what they have been told and promised, and what they see happening to themselves and their local neighbourhoods.

        • Paul 9.1.1.2

          NZ media is the same.

          • aerobubble 9.1.1.2.1

            What a beat down on Q&A. The poor old analyst was expose right royally for not having a clue about all the voters who don’t vote but who are getting real hurt by this governments policies. Promise, Keys popularity, its Keys popularity that matters. Shakes head.

    • blue leopard 9.2

      “Put in this context, the recent disenfranchisement of the US poor and disappearing middle class is nothing more than a reversion to mean.”

      I don’t know why you are doing this, CV, but all you are doing is a distraction from the good and potentially good effects a study such as this one cited represents/can lead to. Are you confusing yourself with details? I suspect so.

      It doesn’t matter whether this is a ‘reversion to the mean’ or not – this study asserts that the democratic system in America is not representing the majority of people who vote. These people vote with the view that their interests or political approaches will be represented. This study is informing them otherwise. A lot probably know that already, however it is more than slightly heart-warming to see that an American University is prepared (and funded) to do such research and come up with something that doesn’t sound like propaganda from the elite.

      In my view this is a big step in a good direction.

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