In Christopher Hill’s seminal 1940 treatise, The English Revolution, he describes the economic and political arrangements of the European feudal era: “By feudalism I mean a form of society in which agriculture is the basis of economy and in which political power is monopolized by a class of landowners. The mass of the population consists of dependent peasants subsisting on the produce of their family holdings. The landowners are maintained by the rent paid by the peasants, which might be in the form of food or labor, as in early days, (or later) in money.”
Interestingly enough, Hill’s circumscription of the Middle Ages has an ominous application to affairs of the modern era. While the central basis for the modern economy is not agriculture, that matters less than the underlying dynamics Hill describes.
To begin, his observation that “political power is monopolized by a class of landowners” needs only slight modification to ring true today. Substitute the corporate boards of energy companies, tech giants, automobile companies, defense contractors and financial institutions for landowners, and the statement holds. One need only look to Washington, D.C.’s K Street lobbyists to verify it. Further amplifying the point, organizations such as opensecrets.org well document the billions of dollars the modern corporate aristocracy use to ensure the fealty of Congress (as well as state legislatures and even local leaders).
Of course it’s not enough to merely feather one’s nest. Real power requires stratification. According to recent studies by economists at the University of California at Berkeley, the Paris School of Economics and Oxford University, the current wealth gap has reached record levels. Analysis from the Internal Revenue Service also supports this chasm. As the IRS observes, the top 1 percent of earners in the U.S. earned 19.3 percent of total household income in 2012 — the largest share for nation’s wealthiest citizens in more than a century. The next highest share of wealth taken by the richest (18.7 percent) was recorded in 1927, just two years before the Great Depression began. Researchers also record that incomes among the top 1 percent rose by 31.4 percent between 2009 and 2012, while incomes for everyone else grew just 0.4 percent.
As a result, the top 10 percent of earners in the economy now control more than half of the nation’s total income. This disparity is very similar to the wealth distribution profile of feudal Europe. Surely, this is not the American dream the framers had in mind.
In their report on the issue of disparity, U.S. News and World report states: “Research suggests that while some inequality is necessary, too much inequality undermines growth: The research shows that the U.S. economy is probably at or near the point where the negative effects of inequality outweigh the positive effects.”
As George H. W. Bush famously proclaimed it, hopes of trickle down growth is “voodoo economics.” His assertion is buttressed by the fact that the wealthy don’t handle their money the way the rest of us do. They tend to save a much higher percentage of it. Munificent reinvestment is a charming story, but the facts just don’t bear it out. In short, the myth of keeping the cats fat so their largess will filter down to the peonage is subordinated to the reality of our present economic litter box.
Not only does an overconcentration of wealth choke out jobs, it curtails educational opportunities. Fewer people can afford the education needed for higher skilled (higher paying) jobs… which then serves to harden class divisions… which solidifies the wealth gap.
Of course the first step in resolving this downward spiral is the most painful — for politicians anyway — complete overhaul of campaign financing. Just imagine a world where the convictions of Congress were not a transactional commodity. What kind of economic and social policy might we then have?
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Matthew Pate is a former law enforcement executive who holds a doctorate in criminal justice from the University of Albany and who has advised police agencies around the country. He writes from Pine Bluff. Contact him at email@example.com.