There can be only one is the tag-line of the Highlander fantasy genre franchise. It refers to the rules of that Highlanders must live by in that eventually all must fight and kill each other until there is only one left. So it is between main street (the average American) and Wall Street (the Finance, Insurance, Real Estate economy).
Two recent articles, one from Professor Jeffrey Sachs and the other from Reporter Chrystia Freeland take on the subject:
we are living in not merely a plutonomy, but a plutocracy, in which the rich display outsize political influence, narrowly self-interested motives, and a casual indifference to anyone outside their own rarefied economic bubble.
Freeland hits the nail on the head. This is a plutocracy, one built by and for the FIRE economy. The inevitable and purposeful result of our Neoliberal system. It's not a coincidence or serendipity, it's the point.
The Top 1% of the population owning more financial wealth than the bottom 95% combined isn't a failture, it's success! Professor Sachs explains:
The level of political corruption in America is staggering. Everything now is about money to run electoral campaigns, which have become incredibly expensive. The mid-term elections cost an estimated $4.5 billion, with most of the contributions coming from big corporations and rich contributors. These powerful forces, many of which operate anonymously under US law, are working relentlessly to defend those at the top of the income distribution.
This new elite, that the FIRE economy has wrought do not believe in paying taxes and believe even less in being Americans. Freeland continues:
they are becoming a transglobal community of peers who have more in common with one another than with their countrymen back home. Whether they maintain primary residences in New York or Hong Kong, Moscow or Mumbai, today’s super-rich are increasingly a nation unto themselves... today’s plutocrats are forming a global community, and their ties to one another are increasingly closer than their ties to hoi polloi back home
A nation unto themselves? Interesting. Of course they apparently don't pay taxes to that nation either as the bailouts required to keep them as our overseers didn't come from the plutonomy but from national governments (taxpayers of every class).
the vast majority of U.S. workers, however devoted and skilled at their jobs, have missed out on the windfalls of this winner-take-most economy—or worse, found their savings, employers, or professions ravaged by the same forces that have enriched the plutocratic elite.
Freeland points out that those forces in the United States are "financial deregulation and upper-bracket tax cuts."
That's right kids, it wasn't computers, the internet or cell phones (all initially researched and developed by the U.S government) that made this economy so lopsided. It was the FIRE economy and the politicians it helped buy. Freeland continues:
The result of these divergent trends is a jaw-dropping surge in U.S. income inequality. According to the economists Emmanuel Saez of Berkeley and Thomas Piketty of the Paris School of Economics, between 2002 and 2007, 65 percent of all income growth in the United States went to the top 1 percent of the population.
Sachs chimes in to provide the historical context:
This tax-cutting frenzy comes, incredibly, after three decades of elite fiscal rule in the US that has favored the rich and powerful. Since Ronald Reagan became President in 1981, America’s budget system has been geared to supporting the accumulation of vast wealth at the top of the income distribution. Amazingly, the richest 1% of American households now has a higher net worth than the bottom 90%. The annual income of the richest 12,000 households is greater than that of the poorest 24 million households.
Get it yet? Feeling the steel on your neck? No...OK, more from Freeland:
recent evidence suggests that, in the wake of the crisis, incomes at the summit are rebounding more quickly than those below. One example: after a down year in 2008, the top 25 hedge-fund managers were paid, on average, more than $1 billion each in 2009, quickly eclipsing the record they had set in pre-recession 2007.
You read that correctly, Wall Street is making MORE money after totally collapsing and getting a bailout while the unemployment rate is near 10% and the average American is paralyzed under a mountain of debt.
Obama swept to power on the promise of change. So far there has been none. His administration is filled with Wall Street bankers. His top officials leave to join the banks, as his budget director Peter Orszag recently did. He is always ready to serve the interests of the rich and powerful, with no line in the sand, no limit to "compromise."
The last statement from Professor Sachs sums it up well. Compromising with the FIRE economy is a losing battle.
There can be only one.