Plutocracy in America: How Increasing Inequality Destroys the Middle Class and Exploits the Poor

By Ronald P. Formisano

Johns Hopkins University Press | 2015 | 264 pages

Reviewed by Fred Beauford

Ronald P. Formisano

Plutocracy or Aristocracy?

The more I read this book, the more I felt that the real story was not that we have become a Plutocracy (rule by the wealthy) but are rapidly becoming an Aristocracy (rule by a privileged class.)

Professor Ronald P. Formisano, who is the William T. Bryan Chair of American History at the University of Kentucky, informs us that the world I was born into, “from World War II to the late 1960’s the benefits of a growing U.S. economy percolated from the bottom through the middle to the top of society. For three decades after 1945 a relatively equally distributed prosperity built a strong middle class that was the envy of the world. As John F. Kennedy put it, ‘a rising tide lifts all boats.’ Those in the lower classes gained as much or more than those in the higher ones.

“The current state of disequilibrium in the United States began in the 1970’s, when the top 1 percent earned about 10 percent of the national income. Since then the income of the richest soared to 15-19 percent of the total in the late 1990’s; in 2007, the richest 1 percent took home 23.5 percent of all income. In the upper precincts of the 0.1 percent, 13,000 households took in more than 11 percent of the nation’s income.”

It couldn’t get any clearer than that. But what happened? How did this come about?

Plutocracy in America takes us down a path well trodden, covering the many whys—from government deregulation, a country flooded with cheap labor, both legal and illegal, and “technology and a virtual global media have led to rapid gains at the very top for the ‘Superstars’ in business and elsewhere. Celebrities such as musicians, athletes, and movie stars now can reach millions of people worldwide and thus command enormous paychecks.”

An example I often cite is the fact that Michael Jordan made $80 to $100 million dollars last year. He also made the same $80 million the year before that and the year before that. In fact, I doubt that Jordan can even remember the last time he made less that $80 million a year. And he is only in his early 50s!

This is what the good Professor is talking about! 

The book also takes us down a road few have dared to go. Professor Formisano cites a study by Enrico Moretti:

“Yet Moretti’s analysis affirms that the causes and consequences of inequality are multiple and interrelated. Some are unintended results of social progress, such as the phenomenon known as ‘assortative mating.’ As more women have acquired higher education, broken glass ceilings, and entered better-paying professions, they tended to marry other higher-income professionals, contributing to income inequality.”

Here is my personal favorite example to illustrate the beast that we men are and why that very beastliness has always played a major role in the redistribution of wealth: Anna Nicole Smith was a high school dropout with a worthless husband and a child to support. One day she was Pole dancing at Gigi’s, a Houston strip joint, when an elderly man by the name of J. Howard Marshall wheeled himself into her show in his custom-made wheel chair. Soon, he was at Gigi’s on a regular basis, throwing more expenses gifts at Anna Nicole Smith than she knew existed in the many heavens folks love bragging about.

But he could afford it. He was worth 1.6 billion dollars. Three years later, the 26 year-old Smith and the 81 year-old Marshall married.

J. Howard Marshall died a year later, no doubt with a smile on his wrinkled old face, and he left her a large fortune as a thank you for making the end of his life filled with such pleasure.

Now, I ask you, do you think that Martha Stewart, Oprah Winfrey, or any of those other overpaid, chattering women on television would do something like that!

Of course not. Mother Nature won’t allow this to happen, not on her watch! So, for now, it’s either you show up with a paycheck larger than theirs, or, forget about it, Bud.

It seems that until women can become as silly as men and stop hoarding their money, there’s little hope for us.

Plutocracy in America is an interesting book. I am glad I read it.

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