Wealth Defense Industry: The Real Reason America's Oligarchs Can Squeeze the Rest of Us

Continued from previous page

Dan Mitchell, a senior fellow (i.e. mercenary) at the Cato Institute (a think tank financed by American oligarchs), defended tax havens as “outposts of freedom.” If Americans are concerned that “individuals are moving their money to countries with better tax law, that should be a lesson to us that we should fix our tax law.”

In other words: Let’s decrease taxes on the super-rich.

The WDI, arising naturally from the opportunities and risks created by enormous wealth, has spawned its own pile of these opinion-makers, free to spread their ideas through a compliant corporate media while oligarchs themselves are free to look on.

Oligarchy, or Democracy?

To argue that the United States is a thriving oligarchy does not imply that our democracy is a sham: There are many policies about which oligarchs have no shared interests. Their influence in these areas is either small or mutually canceling.

Though it may strike at the heart of elitism, greater democratic participation is not an antidote to oligarchic power. It is merely a  potential threat. Only when participation challenges material inequality – when extreme wealth is redistributed – do oligarchy and democracy finally clash.

The answer to the question of inequality, then, is troubling. Wars and revolutions have destroyed oligarchies by forcibly dispersing their wealth, but a democracy never has.

Democracy and the rule of law can, however, tame oligarchs.

A campaign to tame oligarchs is a struggle unlikely to fire the spirits of those outraged by the profound injustices between rich and poor. However, to those enduring the economic and political burdens of living among wild oligarchs, it is an achievement that can improve the absolute welfare of average citizens, even if the relative gap between them and oligarchs widens rather than narrows.

A graduate student in one of my seminars – resisting my terminology – once declared that the “U.S. has rich people, not oligarchs.” More than anything else, that statement claims that somehow American democracy has managed to do something no other political system in history ever has: strip the holders of extreme wealth of their inherent power resources and the political interests linked to protecting those fortunes.

Of course, this hasn’t happened.

But it is endlessly fascinating that we’re now in a moment when Americans are once again asking fundamental questions about how the oligarchic power of wealth distorts and outflanks the democratic power of participation.