# The U.S. is a plutocracy, and here's why. **URL:** \ **Category:** Great Debates\ **Created:** [May 30, 2000, 6:41pm UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915 "2000-05-30T18:41:11Z")\ **Posts on this page:** 13\ **Page:** 2
**Author:** ![Mr.Zambezi](https://avatars.discourse-cdn.com/v4/letter/m/7cd45c/32.png) [@Mr.Zambezi](https://boards.straightdope.com/u/Mr.Zambezi)\ **Post date:** [June 2, 2000, 11:22pm UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915/21 "2000-06-02T23:22:09Z")
> [@](#): > > \*\* > Fine, but what is in the interests of a particular corporation and its shareholders may not be in the interests of society at large. And I would argue, that in general, and outside of Hollywood movies, it is. > [@](#): > > Wow, I don’t recall saying anything even **close** to that. That sure is a nice anthropomorphic haystack you’ve got there. Of course you didn’t say anything close to that. You are wise enough to temper your comments a little bit. But the implication of your comments is that the Rich are acting in their own interests to the detriment of others. Hence the vision of the big evil corporate empire casting 5,000 workers into the streets for a few measly points of earnings per share. > [@](#): > > What the hell, let’s just say that all the poor are lazy leeches who are too stupid or too weak to survive on their own without government help, and that their existence just gets in the way of good old American capitalism. And call it a straw-damn-diddly-man day. Well, I would say **most** poor…but have it your way! 😉 ---
**Author:** ![DoctorJ](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/doctorj/32/2904_2.png) [@DoctorJ](https://boards.straightdope.com/u/DoctorJ)\ **Post date:** [June 2, 2000, 11:22pm UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915/22 "2000-06-02T23:22:57Z")
OK, let’s look at a (not very) hypothetical. Your company has a factory in a medium-sized Midwestern town that employs 5000 people. The employees of the factory make a good living wage, and many of them have worked there for 20 years or more. Your company is turning record profits, and has no indication of doing any worse in the foreseeable future. However, it is possible to move the operation to Lower Bahavagadoshitstan, where labor laws don’t exist and plenty of workers are available for $1 an hour. Predictions indicate that the profits of this move would result in a modest increase in stock prices. It would, of course, propel this town and your 5000 employees into ruin, where they’ll be lucky to find a $6/hr job at Taco Bell. Is that right? In his book _Downsize This!_, Michael Moore talks about how the current corporate mindset would consider this not only the company’s right, but its responsibility. The corporation has no responsibility to society whatsoever–it exists only to make a profit for its shareholders. Shouldn’t the company have some responsibility to the people who helped make it prosperous? Do you see how the interests of the wealthy and the corporations can be in conflict with those of the working people? Dr. J ---
**Author:** ![DoctorJ](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/doctorj/32/2904_2.png) [@DoctorJ](https://boards.straightdope.com/u/DoctorJ)\ **Post date:** [June 2, 2000, 11:34pm UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915/23 "2000-06-02T23:34:04Z")
Simulpost. > [@](#): > > But the implication of your comments is that the Rich are acting in their own interests to the detriment of others. Hence the vision of the big evil corporate empire casting 5,000 workers into the streets for a few measly points of earnings per share. What gives you the impression that this never happens? In my example, how exactly would this move be benficial to anyone but the shareholders? (Except, perhaps, the people of Lower Bahavagadoshitstan, who are now starving to death at a slightly less rapid pace.) Dr. J ---
**Author:** ![Mr.Zambezi](https://avatars.discourse-cdn.com/v4/letter/m/7cd45c/32.png) [@Mr.Zambezi](https://boards.straightdope.com/u/Mr.Zambezi)\ **Post date:** [June 2, 2000, 11:38pm UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915/24 "2000-06-02T23:38:00Z")
a) moving a company out of the country is a bit different than downsizing. b) Moore is still pissed about Flint c) the example is not a very common one d) On a global scale I would say that the factory moving could be a pretty big boon for Whateverstan and its people and perhaps help to industrialize their country e) if the company can manufacture good for a lower cost and deliver them to the US market more cheaply, then a lot of poor people woudl benefit. LEt’s say that the company makes winter coats for 20% cheaper. Well, porr people all over the US can now save 20% on coats. f) the company would be doing everyone a disservice if they were not competetive and evetually lost market share and went out of business. ---
**Author:** ![oldscratch](https://avatars.discourse-cdn.com/v4/letter/o/ed655f/32.png) [@oldscratch](https://boards.straightdope.com/u/oldscratch)\ **Post date:** [June 3, 2000, 12:18am UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915/25 "2000-06-03T00:18:53Z")
> [@](#): > > \*\* > a) moving a company out of the country is a bit different than downsizing. \*\* We’re not talking about moving the company out of the country. We are talking about outsourcing a significant portion of the work. This is usually what happens in downsizing. Outsourcing and consolidation of existing jobs. > [@](#): > > \*\* > b) Moore is still pissed about Flint \*\* And this makes his points less valid how? There are people who are pissed about what happened to this country during the Vietnam War. That doesn’t make their points less valid. > [@](#): > > \*\* > c) the example is not a very common one \*\* Oh really? Last year there were 1,149,149 layoffs in the United States. There has been an increase lately in the number of mass layoffs. Also there are currently a many layoffs per year as there are during slump times. > [@](#): > > \*\* > d) On a global scale I would say that the factory moving could be a pretty big boon for Whateverstan and its people and perhaps help to industrialize their country \*\* Ah yes. The old industrialization argument. People really are better working in an unsafe workplace with no labor regulations. They are better when they are beaten and abused by their employers. The idea that a country like Whateverstan would be worse off without forced work camps and low labor is ridiculous. Now if they wanted to go in there and make sure that they complied with US labor laws that would be great. The workers would be doing better, and they would make a positive impact on the country. Of course they have still just screwed 5000 people out of jobs here. > [@](#): > > \*\* > e) if the company can manufacture good for a lower cost and deliver them to the US market more cheaply, then a lot of poor people woudl benefit. LEt’s say that the company makes winter coats for 20% cheaper. Well, porr people all over the US can now save 20% on coats. \*\* But not if they don’t have jobs where they can afford the coats. And when have companies actually reduced costs on products after outsourcing the work? They don’t, they only increase profits. From the journal of international affairs > [@](#): > > Increased Supply, Reduced Demand > The expansion of output in this system takes place by “minimizing employment” and compressing workers’ wages. This process in turn backlashes on the levels of consumer demand for necessary goods and services: unlimited capacity to produce, limited capacity to consume. In a global cheap labor economy, the very process of expanding output (through downsizing, layoffs and low wages) contributes to compressing society’s capacity to consume. The tendency is therefore toward overproduction on an unprecedented scale. In other words, expansion in this system can only take place through the concurrent disengagement of idle productive capacity, namely through the bankruptcy and liquidation of “surplus enterprises.” The latter are closed down in favor of the most advanced mechanized production. Entire branches of industry stand idle, the economy of entire regions is affected and only a part of the world’s agricultural potential is utilized. > This global oversupply of commodities is a direct consequence of the decline in purchasing power and rising levels of poverty Oversupply contributes in turn to the further depression of the earnings of the direct producers through the closure of excess productive capacity. Contrary to Say’s Law of Markets, heralded by mainstream economics, supply does not create its own demand. Since the early 1980s, overproduction of commodities leading to plummeting (real) commodity prices has wreaked havoc, particularly among Third World primary producers, but also (more recently) in the area of manufacturing. > [@](#): > > \*\* > f) the company would be doing everyone a disservice if they were not competetive and evetually lost market share and went out of business. \*\* To a degree you are right. It’s not that the company president is necessarily a bad person, though he might be. He has to stay competitive, and if he doesn’t the shareholders will elect someone who will. Of course this doesn’t make it right, but that is the madness of capitalism. ---
**Author:** ![Erik\_Raven](https://avatars.discourse-cdn.com/v4/letter/e/c4cdca/32.png) [@Erik\_Raven](https://boards.straightdope.com/u/Erik_Raven)\ **Post date:** [June 3, 2000, 4:03pm UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915/26 "2000-06-03T16:03:33Z")
> [@](#): > > **Yes, like Gore, who was quite successful at…um…well, OK, there’s Dubya, who really did some great things as a…er…well, let’s see, there’s Mitch McConnell, my own Senator, who was…dammit…wait! My other Senator, Jim Bunning! He was a pretty good baseball player!** Okay, let’s take Jim Bunning. What did he do after he left baseball? Ran for city council. Then state senate. Spent about eight years there, and ran for Congress. Twelve years later he ran for Senate. Like him or not, that’s a record of public service. There are bound to be exceptions to any rule of thumb, but in general those who run for federal offices have established some kind of record in either lesser offices or in their careers. When running for office, this is generally what is emphasized in campaigns where negatives haven’t taken over. > [@](#): > > **You’ll also notice that the majority of the Congressmen in the top ten of that list either inherited or married into their money.** Yeah. Most of the top ten also have lengthy records of public service going back more than 20 years, where people don’t generally make a lot of money. For those who recently entered office, a fair number, as I contend, have a successful business record, such as Lautenberg, Bennett, Edwards, etc. > [@](#): > > \*\* > > > [@](#): > > > > I wouldn’t necessarily disagree with that(money buys access), but there are many other factors that rank higher on the access importance scale than money. > > If you believe that, I have some land you might be interested in.\*\* That’s really not a very good argument. Having worked for elected officials and on congressional campaigns, I’ll stick by my experience rather than groundless cynicism. > [@](#): > > **This is what I mean by the fact that money is necessary, but not sufficient. What about an equally important issue that has just as much popular support, but no money behind it? (Say, gun control, or environmental legislation.) Do you think the spokespeople for those causes have just as much access as Boeing?** Actually, yes. For example, PIRG (Ralph Nader’s group) is known by most policy makers to be a bunch of nutballs (I don’t mean to offend any PIRG supporters, but this is the general feeling), but because of the issues they work on and the not-insignifiant membership, still manage to represent themselves pretty darn well. Also, Handgun Control Inc., despite having much less money than the NRA, has fantastic access to Congress… not to mention the White House. And it ain’t because of their contributions. > [@](#): > > **I’m glad that your Congressman does this. I wish ours did. To my knowledge, they only make it back to KY for fund raisers and the occasional election.** Call your local congressman’s office. Probably 99% of congressmen head back to their home districts for three-four days every two weeks, and spend most recess time in their districts. I guarantee there are public events you are missing. > [@](#): > > **Rather than skewing the point, that is the point. The reason incumbents are so hard to beat is that you just can’t outspend them. They spend their whole term in office making the connections to the big donors and raising money for the next run. When the opposition realizes that even if they bust their ass, they won’t be able to raise a tenth as much as the incumbent, they just give it up, and the only opposition is a [potted plant](http://www.ficus2000.com).** Sorry, that’s not it at all. The reason most seats are uncompetitive is because of the political composition of the constituents. Do you think a Ted Stevens or a Bob Byrd are in very safe seats because they have access to a lot of money? Well, they DO have access to a lot of money, but Alaska is as safe a Republican seat as you get, and West Virginia is as safe of Democratic seat as you can find. > [@](#): > > If you look at close races, however, there’s not that much difference between how much money the candidates spent. > \*\* > Perhaps explaining why the race was close.\*\* No, that doesn’t really do it. In any given cycle, not very many seats are actually competitive, for a variety of reasons. Political composition, gerrymandering, lack of good challengers, and so on. [http://congress.nw.dc.us/cgi-bin/emap.pl?dir=rollcall](http://congress.nw.dc.us/cgi-bin/emap.pl?dir=rollcall) The thing is, even if it takes money to get elected, there really isn’t that big a difference between the opinions of the public at large and those in Congress. Taking from the main line of argument in this thread, I suppose those believing the US to be a plutocracy would contend that PNTR for China is an interest primarily for the rich. Well, one could categorize it that way, but comparing the House vote to public opinion polls, people inside and outside of Congress see the issue in pretty much the same light. [http://www.gallup.com/poll/releases/pr000418b.asp](http://www.gallup.com/poll/releases/pr000418b.asp) Or perhaps there’s some conspiracy behind the close vote in the House, eh? ---
**Author:** ![SarumanRex](https://avatars.discourse-cdn.com/v4/letter/s/6de8d8/32.png) [@SarumanRex](https://boards.straightdope.com/u/SarumanRex)\ **Post date:** [June 5, 2000, 12:59am UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915/27 "2000-06-05T00:59:24Z")
I read all of your posts and have a few simple points to make: 1. Money is a type of power, political influence is another type of power, the fact that you can easily exchange one type of power for another should not shock or offend anyone. The rich have always been and will always be more influencial than the poor, though they be outnumbered 100 to 1. This is true of our country and all others, it was true when the founding fathers wrote the Constitution and it will be true when we are all pushing up daisies. The powerful never go hungry. 2. On a world scale, we are the rich people, don’t ever forget that. The fact that you are reading this, that you are literate, that you have access to a computer and the spare time to spend chatting with idiots like me proves that you richer than the average human being. 3. My third and final point is incredibly crass. The very first organisms to live on this planet knew something we seem to overlook, that the only way to survive is to build a (cell)wall around yourself and only let inside the parts of the environment you can use to advance your own selfish existence. We as a nation can not save the world, they outnumber us 20 to one, we can’t even save China with this ill-conceived trade deal. We have to build a wall around ourselves and only let in the people, goods, and services that can somehow make America stronger. Now, before I’m accused of racism I support more immigration. I think that if we need cheap labor we should import the people not export the jobs. We’ve given away the entire textile industry to brutal countries like China, and it has made them stronger, strong enough to bribe our officials and secure a lucrative trade pact. 'Nuf said. ---
**Author:** ![Mr.Zambezi](https://avatars.discourse-cdn.com/v4/letter/m/7cd45c/32.png) [@Mr.Zambezi](https://boards.straightdope.com/u/Mr.Zambezi)\ **Post date:** [June 5, 2000, 6:25pm UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915/28 "2000-06-05T18:25:24Z")
> [@](#): > > But not if they don’t have jobs where they can afford the coats. And when have companies actually reduced costs on products after outsourcing the work? They don’t, they only increase profits. Funny how with nafta and all of that cheap labor overseas, and even after all of those horrible, brutish layoffs, teh unemployment rate has gone _down_ and GDP has gone up. ---
**Author:** ![SarumanRex](https://avatars.discourse-cdn.com/v4/letter/s/6de8d8/32.png) [@SarumanRex](https://boards.straightdope.com/u/SarumanRex)\ **Post date:** [June 5, 2000, 8:17pm UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915/29 "2000-06-05T20:17:18Z")
One has to be very careful when using unemployment statistics to judge the health and welfare of the American public. A 4% unemploment figure just means that 4% of Americans are collecting unemployment benefits. It doesn’t mean that 96% of us are employed, that we are paid anywhere near what our labor is worth, or that we have jobs which use our training and college degrees. For example: A person who is unemployed for more than 6 months loses their benfits and is no longer considered unemployed. A computer programmer who loses a $23/hour position and is forced to take a $6/hour job washing dishes is considered fully employed if he works 40 hrs a week. This is called underemployment and no one keeps accurate statistics on it. The true test of our nations prosperity is to find out where all the money is going. Is the increase in the GDP only making the rich richer and the poor poorer? I think it is since real wages have remained stagnant. ---
**Author:** ![Mr.Zambezi](https://avatars.discourse-cdn.com/v4/letter/m/7cd45c/32.png) [@Mr.Zambezi](https://boards.straightdope.com/u/Mr.Zambezi)\ **Post date:** [June 5, 2000, 8:51pm UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915/30 "2000-06-05T20:51:32Z")
Rex said > [@](#): > > The true test of our nations prosperity is to find out where all the money is going. Is the increase in the GDP only making the rich richer and the poor poorer? so if the country is making a lot more money, that may not be good because the wealth is not evenly distributed. And if the number of people filign for unemployment goes down, that is probably bad because it means that everyone has either been unemployed for more than six months or is washing dishes. I am assuming then that the only way an economy can be considered successful is if it is both making money and redistributing wealth. BTW, workers are so scarce out here that they are paying teenagers $12/hr to work at the gap and Wendy’s is paying $9.00/hour. THey can’t even get employees—not even the $23/hour programmers that are all out of work do to the rich stealing all of the GDP. ---
**Author:** ![SarumanRex](https://avatars.discourse-cdn.com/v4/letter/s/6de8d8/32.png) [@SarumanRex](https://boards.straightdope.com/u/SarumanRex)\ **Post date:** [June 5, 2000, 9:55pm UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915/31 "2000-06-05T21:55:13Z")
Sorry about the double post, my bad. My only points were that unemployment figures can be misleading and that the figures on real wages (as reported by the CBS news)remain stagnant. This is good news for rich investors who are terrified of inflation reducing the value of their portfolios, it is not good news for people who work for an hourly wage. I have also heard stories of entry level positions paying high wages but apparantly not everyone is reaping the windfall. To re-iterate my overall message: I believe that America’s best course of action is to seal itself off economically and begin a concerted effort to make all American’s more comfortable (not rich since that is a relative term) and America as a whole will be a stronger nation. This will never happen on its own no matter how high the GDP goes. Reagan’s trickle down economics bullshit has proven that. If you throw money at the economy it will inevitably end up in the bank accounts of the richest, stingiest, greediest sons of bitches America has to offer. An increase in the GDP just means that there is more money out there to be had, who do you think is going to have it? Single welfare mothers or Bill Gates? ---
**Author:** ![Mr.Zambezi](https://avatars.discourse-cdn.com/v4/letter/m/7cd45c/32.png) [@Mr.Zambezi](https://boards.straightdope.com/u/Mr.Zambezi)\ **Post date:** [June 5, 2000, 10:19pm UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915/32 "2000-06-05T22:19:44Z")
So when the GDP goes up and these “rich greedy bastards” get most of the money, they don’t hire people, don’t spend it, don’t create new businesses, don’t build new houses? It strikes me as odd that you use Bill Gates as an example. Did he not create a lot of millionaires through the creation of Microsoft? Does he not employ a lot of people at very high salaries? Hasn’t Microsoft greatly improved the economy of both Seattle and the US? My point is that when more money is being made, more is being spent and there is more opportunity to improve one’s lot. The “rich” are often those that created companies which employ many people. The “rich” are not necesarily evil. And refusing to trade with anyone is not necesarily going to improve the lot of the poor. How, for example, will one afford one of those great American cars when there is absolutely no Toyota or Kia to compete with? Ditto electronics, clothing, etc.? ---
**Author:** ![SarumanRex](https://avatars.discourse-cdn.com/v4/letter/s/6de8d8/32.png) [@SarumanRex](https://boards.straightdope.com/u/SarumanRex)\ **Post date:** [June 6, 2000, 12:41am UTC](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915/33 "2000-06-06T00:41:20Z")
> [@](#): > > \*\* > The “rich” are often those that created companies which employ many people. The “rich” are not necesarily evil. > > And refusing to trade with anyone is not necesarily going to improve the lot of the poor. How, for example, will one afford one of those great American cars when there is absolutely no Toyota or Kia to compete with? Ditto electronics, clothing, etc.? > \*\* In a previous post I stated that we are the rich people. “Rich” is a relative term and compared to third world people, you and I are both quite rich. I never intended to equate wealth with evil. I used Bill Gates as an example of a vicious competitor who schemed to destroy other American companies and hog the entire software market to himself. The fact that other people became millionaires along the way does not excuse his behavior. I find it intersting that you use Toyota as an example of a good car that’s hard to compete with. How did it get to be such a high quality automobile? Japan (being a near perfect example of how a protected economy should work) has enormous non-tariff barriers set up to protect its domestic industries. There is, effectively, no competition in Japan from American cars since it costs an extra $20,000 (inspection fees etc.) to import a vehicle into the country. They make great cars because they decided to make great cars and did it. They have some of the highest manufacturing standards in the world and they don’t need to import billions of dollars of other countries goods to force their own industries to produce a viable product. If they could do it then so can we, we don’t need their cars or their electronics or anything else. We should be competing with Japanese products in Japan not the other way around. [Previous page](https://boards.straightdope.com/t/the-u-s-is-a-plutocracy-and-heres-why/20915.md?page=1)