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2 Who Is the 1 Percent?

Collins, Chuck Berrett-Koehler Publishers ePub

We can have concentrated wealth in the hands of a few or
we can have democracy. But we cannot have both.
—Louis Brandeis (1856–1941)

The “1 percent” framework is a useful lens for understanding the dramatic changes that have occurred in the last several decades. It is a real demographic we can pinpoint and picture as well as a symbolic reference to those primarily responsible for the polarization of wealth in our Union.

The “1 percent” icon has obvious limitations, too. It suggests we should focus on wealthy individuals when we also should be thinking about the role of the wealthiest corporations, sometimes summarized as “Wall Street.” In chapter 5, we will discuss the Wall Street inequality machine and the interaction between the individual 1 percent and corporations.

The other limitation with the concept “99 to 1” is it presumes that everyone in the 1 percent thinks and acts the same. Within the 1 percent are some people who have dedicated their lives to building a better world for the 100 percent. The focus of our wrath should be on the segment of the 1 percent—the game riggers and rule fixers—who use their wealth and power selfishly to perpetuate their own privilege, wealth, and power.

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3 How the 1 Percent Rigs the Rules of the Economy

Collins, Chuck Berrett-Koehler Publishers ePub

A State divided into a small number of rich and a large number of poor will always develop a government manipulated by the rich to protect the amenities represented by their property.
—Harold Laski (1893–1950)

How does the 1 percent use its power?

Within the 1 percent, there are people who use their economic and political power differently. In one respect, the 1 percent is not much different from the population at large in that only a small segment is engaged in politics and actively advocating on policy matters. Some in the 1 percent care about the 100 percent and work for a fair and sustainable economy. Others are rule fixers, focused on rigging government policies in their favor to get more wealth and power. But the majority are unengaged and happy to watch their wealth accumulate without weighing in one way or another.

The game fixers maintain a worldview that justifies using every tool at their disposal to perpetuate and expand their wealth. Most believe they are the engines of the economic train, creating enterprises and wealth that pull everyone else along. This worldview is well captured in the introduction to the 2010 Forbes 400 survey.

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Contents

Collins, Chuck Berrett-Koehler Publishers ePub
Medium 9781609945923

10 Bold Rule Changes to Break Up Concentrated Wealth

Collins, Chuck Berrett-Koehler Publishers ePub

In a world of increasing inequality, the legitimacy of institutions that give precedence to the property rights of “the Haves” over the human rights of “the Have Nots” is inevitably called into serious question.
—David Korten (1937)

We must change the rules of the economy so that they serve and lift up the 100 percent, not just the 1 percent. Starting in the mid-1970s, the rules were changed to reorient the economy toward the short-term interests of the 1 percent. We can shift and reverse the rules to work for everyone.

There are three categories of policy changes that we need: rules and policies that raise the floor, those that level the playing field, and those that break up overconcentrations of wealth and corporate power. These are not hard-and-fast categories, but a useful framework for grouping different rule changes.

1.Rule changes that raise the floor

• Ensure the minimum wage is a living wage

• Provide universal health care

• Enforce basic labor standards and protections

2. Rule changes that level the playing field

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6 How Inequality Wrecks Everything We Care About

Collins, Chuck Berrett-Koehler Publishers ePub

The reality is that U.S. society is polarizing and its social arteries are hardening. The sumptuousness and bleakness of the respective lifestyles of rich and poor represents a scale of difference in opportunity and wealth that is almost medieval—and a standing offense to the American expectation that everyone has the opportunity for life, liberty and happiness.
—Will Hutton (b. 1951)

Inequality is wrecking the world. Not just poverty, which is destroying the lives of billions of people around the planet, but also inequality—the accelerating gap between the 99 percent and the 1 percent.

According to research in dozens of disciplines, the extreme disparities of wealth and power corrode our democratic system and public trust. They lead to a breakdown in civic cohesion and social solidarity, which in turn leads to worsened health outcomes.

Inequality undercuts social mobility and has disastrous effects on economic stability and growth. The notion of a “death spiral” may sound dramatic, but it captures the dynamic and reinforcing aspects of inequality. And these inequalities were a major contributing factor to the 1929 and 2008 economic downturns. What follows is the case against inequality.

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