“The1%”: The Pluses and Minuses of an Historic Term

The ruling class, the billionaires who profit from human suffering, care only about expending their wealth…I threw families onto the street in Iraq only to come home and find families thrown onto the street in this country and this tragic, tragic and unnecessary foreclosure crisis. We need to wake up and realize that our real enemies are not in some distant land and not people whose names we don't know and cultures we don't understand. The enemy is people we know very well and people we can identify. The enemy is a system that wages war when it's profitable. The enemy is the CEOs who lay us off our jobs when it's profitable, is the insurance companies who deny us health care when it's profitable, is the banks who take away our homes when it's profitable. Our enemy is not five thousands miles away, they are right here at home.

 – U.S. Iraq invasion veteran Mike Prysner, testimony to the Iraq Veterans Winter Solider Hearings, March 2008[1]



But what about managers? What about doctors? What about lawyers and engineers? What about financial officers? What about people who earn five, six, ten, twenty, and even fifty times what the typical worker earns, but who do not own the means of production, do not work harder, do not labor under harsher conditions, and do not work more intensely than more typical workers?‘ What about people who have jobs that are highly empowering and convey very substantial and sometimes incredible wealth and status inaccessible to those below?

– Mike Albert, November 21, 2011[2]





Six Difficulties


It’s not for nothing that I put “the 1%” in quotation marks in the title of a study I am drafting on the subject of who rules America. I have six related difficulties with the potent populist term popularized by the Occupy Wall Street movement and mainstream media last year – “the 1%” and its corollary (the other side of the populist coin) “the 99%.”


Capitalists and Capitalism


First, reflecting my own Left background, I would prefer that we call the United States’ economic elite capitalists. “Calling them capitalists,” the left anarchist Mike Albert explained last fall, “pinpoints that they own the economy …that the 1% are on top by virtue of owning productive property…   It clarifies that to get rid of 1% dominating 99% ultimately requires replacing capitalism.”[3] I concur.


Transcending the domination of the many by the few means going beyond what the radical Iraq War veteran Mike Prysner (quoted at the top of this essay) calls “a system that wages war [and denies us health care and takes away our homes and jobs – P.S.] when it's profitable.” Prysner might specify unnamed individual “billionaire” and “CEO” members of “the ruling class” – “people we know very well and people we can identify” – but the gist of his comment rightly highlights the profits system in ways consistent with the writings of both the great anti-capitalist Karl Marx[4] and the great 20th century democratic socialist Dr. Martin Luther King, Jr. In 1967, the great Civil Rights and social justice and antiwar leader argued that “the roots [of economic injustice] are in the [capitalist] system rather in men or faulty operations.”[5] The following year, near the end of his life, King wrote (in a posthumously published essay titled “A Testament of Hope”) that “the black revolution” was “exposing evils that are rooted deeply in the whole structure of our society. It reveals systemic rather than superficial flaws and suggests that the radical reconstruction of society itself is the real issue to be faced.” I concur.


The Corporation


Second, as the veteran liberal wealth disparity critic Chuck Collins notes, “The ‘1 percent’ icon….suggests we should focus on wealthy individuals when we should also be thinking about the role of the wealthiest corporations, sometimes summarized as ‘Wall Street.’”[6] The capitalist class has long pooled investments and organized its profit-seeking operations in those giant and fundamentally pathological “persons” called corporations.[7] The “corporate reconstruction of American capitalism”[8] was completed nearly a century ago and it is largely through the corporation that “the 1%” has gained its wealth and power.


The .001 Percent


Third, strange as it might seem, the top hundredth may actually be too big a slice of the population to highlight when it comes to the question of which Americans have gained most from the nation’s highly skewed and unequal pattern of economic growth over the last three plus decades. Between 1974 and 2007, it is true, the share of U.S. income “earned” by the top U.S. income hundredth more than doubled – from 8 to 18 percent. Including capital gains, the increase goes from 9 to 24 percent, the 1%’s highest share since 1928, the eve of the stock market crash that ushered in the Great Depression. But, as political scientists Jacob Hacker and Paul Pierson noted in their important 2010 book Winner Take All Politics:


‘the top 1 percent, while seemingly an exclusive group, is much too broad a category to pinpoint the most fortunate beneficiaries of the post-1970s income explosion at the top….In terms of share of national income earned, the top 0.1 percent [the top thousandth] have seen their slice of the pie grow from 2.7 percent [in 1974] to 12.3 percent of income – a more than fourfold increase…..[and] the gains within this superrich group are themselves highly concentrated….the top 0.01 percent (the richest one in ten thousand households) have seen an even more spectacular rise. From less than $4 million in average annual incomes in 1974, the average member of this select group now earns more than $35 million. From earning less than 1 of every 100 dollars, these supremely fortunate souls now earn more than 1 of every 17 – more than 6 percent of national income accruing to 0.01 percent of families. This is the highest share of income going to this group since the data begin to be collected in 1913 [emphasis added].’ [9]


And then there’s wealth, more unequally distributed than income.[10] The United States is home to 56,860 people (0.05 % of the population) identified by the global wealth intelligence firm Wealth X as “Ultra High New Worth” (UHNW) individuals. A UHNW individual is anyone with at least $30 million in worth, “including shares in companies, real estate, cash, art collections, private planes and other invest-able assets.”  At the top of the industrialized world’s most unequal country (the United States) are more than 400 billionaires. The pinnacle is held by three men – Bill Gates (net worth of $59 billion), Warren Buffett ($33 billion) and Lawrence Ellison ($33 billion) – whose combined wealth exceeded the collective, recession-inducted budget-shortfalls of every U.S. state in 2011.


The cumulative wealth of “the Forbes 400” (the 400 wealthiest Americans) is $1.54 trillion, roughly the same net worth possessed by the entire bottom half of U.S. families. Even more shocking, six Waltons – five children and one daughter-in-law of Sam and James “Bud” Walton (the founders of Wal-Mart, whose previously unimaginable profits flowed from the import of goods manufactured at super-exploitive wage levels abroad and especially in China) had a total net worth of $69.7 billion. This was equal to the total wealth of the entire bottom 30 percent of Americans.


“The 1%” versus “the 99%” dichotomy hardly captures this level of disparity.


“The Rule Riggers”


Fourth, “the 1%” is internally fragmented in a different, political sense between those within the top h

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