The 1% Versus the 99%: Realignment, Repression or Revolution

Wealth Inequality Is Putting the US on Course for a Showdown

The Illustration shows a "Standard Oil" storage tank as an octopus with many tentacles wrapped around the steel, copper, and shipping industries, as well as a state house, the U.S. Capitol, and one tentacle reaching for the White House. Published September 7, 1904.  Photo credit: Puck / Library of Congress
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The richest 20 Americans now own as much wealth as the country’s poorest 152 million people combined.

That is just one of the findings of noted inequality scholar and author Chuck Collins’s most recent report, “Billionaire Bonanza, The Forbes 400 and the Rest of Us.”

In a wide-ranging interview, which will be available in its entirety as a podcast tomorrow, Collins likened the current situation to the “Gilded Age,” the time just before the turn of the 20th century, when there was a similar accumulation of wealth at the top and political power was concentrated in the hands of a few rich men.

And Americans are slowly realizing that the extreme accumulation of wealth at the very top is hurting their own prospects.  But grassroots efforts to redress economic inequality must contend with the political power that comes with great wealth.

Wages have now been stagnant for three decades and the median wealth of Americans has actually declined since 1990. At the same time, the rich have gotten richer. A lot richer.

This is an unstable situation. With pressure building for change but potent forces stacked against it, there are only three options, Collins told WhoWhatWhy: “Realignment, revolution or repression.”

Rules Rigged, and the Rich Get Richer

Back in the Gilded Age, the country managed to convert the pressure that was building from the bottom up into meaningful changes that resulted in a realignment of political power and the rise of the middle class. Those gains, however, are now being reversed. In fact, a new report found that, for the first time in decades, the middle class no longer constitutes the economic majority in the United States.

The shift toward increasing inequality began in the 1970s. At that time, Collins says (and research shows), “we stopped being an economy in which most people grew together” and instead became a “society that is dramatically pulled apart.”

Wages have now been stagnant for three decades and the median wealth of Americans has actually declined since 1990. At the same time, the rich have gotten richer. A lot richer.

Like the Great Depression in the early 1930s, the economic crisis of 2008 has been a wake-up call for the country. Polls historically have shown that people are indifferent to great wealth as long as they feel the rules are fair and that they at least have the option of moving up the ladder. But for many, the latest crash is changing that perception.

“In the economic meltdown of 2008, people realized the rules are rigged, that the big financial industry people … are tipping the scale in their favor,” Collins said. This has led to a perception that upward mobility in America is stalled — a perception supported by statistical data.

Collins believes that this sentiment has helped boost the candidacies of presidential hopefuls as diverse as Donald Trump and Bernie Sanders.

The collapsing middle class, including groups like recent college students whose prospects are blighted by crushing debt burdens, represents an “angry and mobilized constituency.” These are the people whose dissatisfactions are articulated by populists like Trump.

At the other end of the spectrum, the success of self-avowed “democratic socialist” Sanders shows how fluid the situation is. Collins pointed out that the Vermont senator has been saying the same things for 30 years — but only now are they resonating with a larger proportion of the electorate.

Collins pointed out that Sanders is the only major candidate who does not need a billionaire bankrolling his primary campaign to do well in the polls.

One bloc of voters who can cause a tectonic shift in the near future are millennials, many of whom are resentful of the obstacles they face in pursuing the American dream while paying off their college loans. With 40 million households shouldering a burden of $1.2 trillion in college debt, Collins believes that if this segment of the population were to organize, they could force significant change.

“Otherwise, the machinery of inequality will just keep chugging along as it currently is and it will get more concentrated,” Collins said. In any case, all of the ingredients are there for a major political realignment.

“We’re headed for a showdown.”

Listen to Chuck Collins discuss these and other issues with Radio WhoWhatWhy’s Jeff Schechtman tomorrow.

Related front page panorama photo credit: Bill Gates (UK Department for International Development / WikimediaCC BY 2.0), Warren Buffett (Fortune Live Media / FlickrCC BY-NC-ND 2.0), Larry Ellison (Oracle PR / FlickrCC BY 2.0), Jeff Bezos (James Duncan Davidson / Flickr CC BY 2.0), Charles Koch (Not pictured), David Koch (Gage Skidmore / FlickrCC BY-SA 2.0), Mark Zuckerberg (Presidencia de la República  / Flickr CC BY 2.0), Michael Bloomberg (Metropolitan Transportation Authority of the State of New York / WikimediaCC BY 2.0), Jim Walton (Walmart / FlickrCC BY 2.0), Larry Page (Marcin Mycielski, European Parliament / WikimediaCC BY-SA 3.0)

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7 responses to “The 1% Versus the 99%: Realignment, Repression or Revolution”

  1. grumpyhillbilly says:

    Some of those 1 percenters got rich off of “fighting ” for equality. Redistribution is and always be a scam that makes the ones in the middle rich and powerful. Unfortunately redistribution is what most millennial types are touting. Some political movement there. “Shackle me for free education and smart phones.” Wake me up when they fight for actual freedom, and not the George W Bush kind.

  2. Lance Hawthorne says:

    The complaint from Socialists and Statists is always the same: “Isn’t inequality horrible?” As long as someone gets rich from producing a great product or service without getting funded by tax dollars, so what? Nobody is forcing you to buy the product or service. If it’s wrong for me to force my neighbor to donate to my favorite charity, it’s wrong for the Government. We can’t morally delegate it to the State. Just because it’s call taxation doesn’t mean it’s not theft. If I use force to take a percentage of my neighbor’s income, it’s theft. It’s still theft even if the Government does it. If it’s wrong for a private
    individual to do it, it’s wrong for the Government.

  3. Kevin says:

    The article says “Collins pointed out that Sanders is the only major candidate who does
    not need a billionaire bankrolling his primary campaign to do well in
    the polls.”

    While I’m no fan of Donald Trump, certainly he qualifies as someone who “does not need a billionaire bankrolling his primary campaign to do well in the polls”.

  4. Kevin says:

    Let’s keep in perspective that Chuck Collins is in the 1% (an heir of the Oscar Meyer fortune). Just because he says he cares about lessening inequity doesn’t mean he actually does. However, even if he is sincere, does he have good solutions?

    • News Nag says:

      So now you’re trolling under different names, still only with character assassination and a feudal system mentality.

  5. (Comment by reader @Glambertoo1) stated many times GOP swinging pendulum back to Gilded Age~ will take decades to swing back if we don’t stop it~

  6. Pertinax says:

    A showdown that will never happen. As long as the sheeple are continually pacified and pandered to on the one hand, and stripped of means of resistance on the other, the pols have us right where they want us. Now brace for them to cull the overpopulated herd – that’s coming as well.