In recent years, much has been written about growing inequality. It is, indeed, one of the most important issues of our time. And the effects of big money on our democracy have been devastating.
Sure, you may still be able to vote to elect those who are supposed to represent you. But that, alone, does not constitute democracy. Not only are the choices of candidates limited to two individuals – the only two who were able to climb their way up the political ladder in order to receive their parties’ blessings and, more important, their campaign funds. All too often, those who are elected are promised large campaign donations by corporations and industries in exchange for political favors. It is not necessarily quid pro quo, but the expectation for a return on the investment is there. So, too is the pressure.
In reality, such high stakes lobbying has long been a part of politics. But, over the past 35 years, things have gotten even worse.
In the late seventies, large US corporations began to see their hold on the world economy slip. New, lower-priced, high-quality imports – many of them made with robotics – from Japan and Germany began to push aside American-made products. US corporations responded by relocating manufacturing – first to the South, then off-shore – in search of lower-priced labor.
Perhaps, the most destructive response was the move to tie CEO compensation to the value of the companies’ share prices. This ushered in an era of ever-increasing CEO salaries and even more lucrative stock options for CEOs – a legalized form of insider trading. The result was for US corporations to seek ever lower-priced labor in countries where there is no regulation and no employee benefits. At the same time corporate profits have soared, employee salaries and corporate investments in the future have diminished – almost guaranteeing that the future will belong to foreign-based corporations. But why would our CEOs care? They and their money will be long gone before it matters.
Our corporations have used the threat of off-shoring jobs to extort our state and city governments. In exchange for their extortion, those governments have assumed many of the risks of corporate relocation or expansion by paying for needed infrastructure, cutting regulations, and delaying or eliminating corporate taxes.
Now these corporations are attempting to extort the federal government.
Unwilling to pay US income taxes on profits made off-shore, these corporations are stashing cash in foreign banks until the federal government agrees to “repatriate” the money at a greatly reduced tax rate. Of course, they’re justifying the extortion by saying that “repatriation” will lead to greater investments and more jobs in the US – the great “trickle down” fraud.
In reality, the money is more likely to be doled out to CEOs and other executives in the form of bonuses (as a reward for robbing ordinary taxpayers) and stock options.
In the meantime, corporations and billionaires have been working to rig the system. Realizing that buying Congress and our state legislatures is cheaper than paying lobbyists, people like the Koch brothers have stuffed the pockets of candidates willing to do their bidding. To pave the way, they pushed conservatives to stack the Supreme Court with ideologues such as Alito, Roberts, Scalia and Thomas. That inevitably led to favorable court rulings giving corporations the rights of people and all but eliminating limitations on political donations. They got the IRS to change its rules allowing “non-profits” to fund political campaigns. When they won control of legislatures, they gerrymandered congressional districts making it all but impossible for anyone but “their people” to win office. And they introduced Voter ID laws to suppress the votes of minorities and the poor.
In 2014, their efforts finally came to fruition. Having already bought the House in 2010, they now own the Senate. It’s no coincidence that the first bills to reach the House and Senate floors were to repeal “Obamacare” and to build the Koch…er…Keystone XL Pipeline. Senate Majority Leader Mitch McConnell has also made it clear that issues such as raising the minimum wage, equal pay for equal work, unemployment insurance and student loan costs will be pushed aside in favor of gutting regulations on health care and financial services and eviscerating the EPA.
If you’re still worried about the effects of so-called “dark money” on our democracy, don’t. Last year, our democracy officially became an oligarchy.