Is the U.S. an oligarchy, or does it just have a bunch of super-rich people living in it? Is there a difference? Author Thom Hartmann joins Nick and Paul to explain the relationship between wealth and American political power and share some of the research that went into his latest book, ‘The Hidden History of American Oligarchy.’

Thom Hartmann is the #1 progressive radio talk show host in the US and a New York Times bestselling author.

Twitter: @Thom_Hartmann

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The Hidden History of American Oligarchy: https://bookshop.org/books/the-hidden-history-of-american-oligarchy-reclaiming-our-democracy-from-the-ruling-class/9781523091584

Website: https://pitchforkeconomics.com/

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Nick’s twitter: @NickHanauer

 

Thom Hartmann:

Over the last 40 years, we’ve seen a new oligarchy arise in the United States on the foundation of Reaganism.

Paul Constant:

We don’t talk a whole lot about oligarchy in our day-to-day in the writing that we do and even in this podcast, but it is very much the same mechanism.

Nick Hanauer:

Wealthy people have always done everything they can to hold onto power and to enhance their power. If you really do want to solve this problem, you are actually going to have to eat the rich.

Announcer:

From the home offices of Civic Ventures in downtown Seattle, this is Pitchfork Economics with Nick Hanauer, the best place to get the truth about who gets what and why.

Nick Hanauer:

I’m Nick Hanauer, founder of Civic Ventures.

Paul Constant:

I’m Paul Constant and I’m a writer at Civic Ventures.

Today we’re going to talk about oligarchies. So an oligarch is a very rich business leader with a great deal of political influence. Joining me today is the host of this podcast, Nick Hanauer, who is a very rich business leader with a great deal of political influence. How are you doing Nick?

Nick Hanauer:

I’m good. Thank you for pointing that out, Paul. It’s very kind of you.

Paul Constant:

Sure, sure. Anytime, yeah, yeah.

Nick Hanauer:

Well, as our resident oligarch… No, I think I’m really excited today to get to talk to our guest, Thom Hartmann. He’s the number one progressive radio talk show host in the US and is a bestselling author. He’s a new cool book out called The Hidden History of American Oligarchy: Reclaiming Our Democracy from the Ruling Class. Thom comes at it I think in his book at slightly different way than we do on our podcast generally, where we talk in more, I think more precise terms about economics. I think we’re in agreement with his generalized thesis, which is that absolute power corrupts and absolute power corrupts absolutely, right?

Paul Constant:

Right.

Nick Hanauer:

When you concentrate power in the hands of the few, however, you do it in a commercial society you tend to do it with economic power, that’s bad for everyone else. I think that the inequality that the oligarchy that we live in represents or implies is definitely tearing the society apart in ways, which are becoming more and more obvious to even the casual bystander. Even some Republicans in our country today maybe starting to think jeepers creepers. We got to manage this thing a little bit better.

Paul Constant:

Yeah, and it’s interesting because we don’t talk a whole lot about oligarchy in our day-to-day in the writing that we do and even in this podcast, but it is very much the same mechanism. Trickle down economics, the $50 trillion that has been taken out of Americans’ paychecks and into the wealthy, this is all still oligarchy. Hartmann in his book is talking about it very clearly as what he believes is one of the leading problems of our time.

Nick Hanauer:

Yeah. There’s simply no doubt that the enrichment of the few and the impoverishment of the many is driving to a great extent the shitstorm, which is happening politically in our country. One of the themes that we’re going to need to explore and develop more in the podcast is the interrelationship between economic inequality and racism and white privilege, and the ways in which the changing demographics and inequality is fueling this rage on the right and let’s face it, anger on the left. There could be no doubt that oligarchs played a huge role in electing Donald Trump. Know a ton of really rich people who don’t give a rip about anything but themselves and thought, “Well, more low taxes, yey,” without ever considering that there may be a downside to that.

Paul Constant:

One of the things I loved about this book is it puts the oligarchy in a historical context. There’s a lot of great stuff in here about slavery and indentured servitude, all the way up to the prison state today and debt peonage, which is still going on in Mississippi and Alabama. So that’s one of the things I really enjoyed about this book was it put it all in historical context. For me, I enjoy… I don’t enjoy. For me, I appreciate knowing that this has happened before. Because if it’s happened before and it’s been overcome, then it can be overcome again.

Nick Hanauer:

Yeah. The depressing part is that usually when it’s overcome, there was a Civil War or World War, some conflagration that definitely was not pleasant to get through for most people.

Paul Constant:

So the book covers a lot of history. So we thought we would share an excerpt from the audio version of the book that will get you up to speed on the role oligarchs had played in American policy and politics over the centuries.

Thom Hartmann:

The transition from democracy to oligarchy usually starts with the very wealthy acquiring political power by buying influence with elected officials. They typically justify this with a belief that oligarchy is more stable and less messy than democracy and that their success demonstrates that a sort of Darwinian process has chosen them to lead.

From there, they begin to so completely control the mechanisms of information, the media and campaigns, financing campaigns directly as well as indirectly via third party groups that their agenda overwhelms the governing agenda.

In the final stages, oligarchs themselves, or people so tightly aligned with them that they could only be called agents of particular oligarchs, rise up through seemingly democratic processes and take complete or near complete control of government.

From there, oligarchs typically begin to as Steve Bannon said was the main goal of the Trump administration, deconstruct the administrative state, seizing control over and corrupting every subordinate agency of government from those responsible for enforcing the laws and the courts to regulatory agencies, to those controlling the nation’s currency and economy.

I’m Tom Hartman, the author of The Hidden History of American Oligarchy: Reclaiming Our Democracy from the Ruling Class.

Nick Hanauer:

Thom, thank you so much for being with us. Let’s start by setting a stage. You break the History of American Oligarchy into three phases. What are they?

Thom Hartmann:

Well, there was the oligarchy of the British and the monopoly over American commerce largely from the East India company. We rose up and overthrew that oligarchy. In fact, the wealthiest families in North America at the time in the 1770s were all aligned with the British. The Johnson family for example, up in Northern New York state had a literal castle with over a thousand people that worked for them, including a number of enslaved people, the people of all races who were there. It was bizarre. They left when the American revolution happened as did many of these very, very wealthy families. So that was the first phase.

The second was with the invention of the cotton gin and the widespread distribution of it around the 1820s, those southern plantations that were large enough at scale to be able to afford the machine, which one machine could do the work of 50 enslaved people in terms of stripping the cotton seeds out of the cotton. Those large plantations that could afford a machine were able to very, very rapidly overwhelmed, economically overwhelmed their competitors, ran out of business most of the small cotton farms in the south and you ended up with a new oligarchy rising during the period of basically 1820 to 1840 in the south about a generation, generation, maybe two generations by 1860. That oligarchy rigidified on the foundation of the police state that had already been established, which I write about in the first book in the series, The Hidden History of Guns in the Second Amendment, that was put into place to preserve slavery. Those oligarchs rose up and challenged the United States itself. We defeated them in the civil war and broke up that oligarchy.

Then we saw the rise of an oligarchy there, but several of them actually, we saw a rise of an oligarchy in the roaring ’20s, came out of the industrial revolution. The Great Depression and the new deal took an ax to that one and now over the last 40 years, we’ve seen a new oligarchy arise in the United States on the foundation of Reaganism.

Nick Hanauer:

So wealthy people have always done everything they can to hold onto power and to enhance their power. How have the ways in which they do that changed over time?

Thom Hartmann:

Well, first of all, to define oligarchy, democracy is ruled by the people. Oligarchy is ruled by the rich. So typically the way that the rich have extended and maintained oligarchy is through capture of government. Before a nation becomes a full-blown oligarchy, you have want to be oligarchs emerging. If the nation allows political bribery, then it’s pretty much guaranteed thing within a generation or two. You will have substantial capture of government by the forces of great wealth in the nation that happened here in the United States in 1976 in the Buckley versus Valeo decision when the Supreme Court legalized billionaires owning politicians, individual politicians.

Two years later, in the First National Bank versus Bellotti decision, the Supreme Court decision that was written by a Lewis Powell, the guy who was the brainchild of the whole era, that body decision legalized corporations owning individual politicians. Then we had a decision just a few years ago that the prior limit had been just basically a few hundred politicians that an individual billionaire or corporation could so completely subsidized that you could say that they own them. They turned that number to unlimited.

So the Supreme Court really set up oligarchy in the United States. When they did that in ’76 and ’78, the Democratic party was still awash with money from unions and so they didn’t much pay attention to it. The Republican party jumped on and brought all this oligarchic money into the party thus propelling Reagan into the White House in 1980 and then they got real serious. So they drop the top tax rate from 74% down to 25%. Just five years earlier, corporations had provided for a third of all the Federal revenues. Right now, it’s 6%. By the end of the Reagan revolution, I think it was down around 12 or 14%. I don’t have the exact in front of me.

So it’s a process that’s fairly predictable. We’ve seen it happened in country after country over the last couple of centuries. It’s reversible, but it can be very difficult to reverse. It typically takes a crisis in order to reverse it like the Great Depression stopped through in ’20s, stopped the oligarchy that was rising in civil war, stopped the oligarchy in the South. The revolutionary war stopped the British oligarchy.

So there are those who are suggesting that the pandemic might be the crisis that would provide for the end of this oligarchy. Others are suggesting that the Trump’s overreached his attempt to impose fascism in the United States. It’s the crisis that’s going to allow us to challenge our oligarchy. There are others who are suggesting that the stock market is so wildly inflated as a result of the Fed, doing something it’s literally never done in its history, which is over the last four years, over the last X year, over the last year. They have literally invented out of thin air $7 trillion, half of the entire GDP of the United States, or a little less than half and use that money to buy corporate stocks and bonds. Never before has the Fed done this. In fact, there are those who argue that it’s illegal.

In doing so, what they’ve done is they’ve propped up giant corporations. They’re buying their debt, buying the bond and the stock market by buying stocks and thus it kept the market high. If the Fed pulls back from that, you’re going to see a massive crash in the stock market. Even if the Fed doesn’t pull back stocks right now, we’re still overvalued that just nature may take its course and crash the stock market. If that happens, then the current recession or depression for anybody who’s not a white collar worker who can work from home is going to turn into a massive nationwide depression. That might provide the impetus along with these other things to flip America back out of oligarchy. We’ll see.

Paul Constant:

Do you think there’s a direct line between the size of the income inequality gap and the increase in authoritarianism? As the rich get richer, do the poor get less free?

Thom Hartmann:

Yes. Everybody gets less free. The people who have done a brilliant job of documenting this are Richard Wilkinson and Kate Pickett with the Equality Trust in the UK. They’ve done research around the world as well as in the United States, literally state-by-state analysis. They’ve written several books on this, The Spirit Level, Why Inequality Matters, and they’ve got a new one out and I don’t recall the title right off the top of my head. It’s something about inequality. What they found is that… What we’re talking about here is not poverty. It’s inequality.

What they found is that as societies become more unequal, even if they don’t experience poverty, as societies become more unequal, something breaks in people. We’re wired for equality. You put a bunch of three-year-olds in a room and you give all the toys to one of the three-year-olds and the rest of them will freak out. We’re wired for equality.

So when inequality gets really huge, society starts to break down. Teenage pregnancies explodes, venereal diseases go up, homicides go up, all forms of crime go up, divorce goes up, mental illness goes up, oddly enough something that you would not think is necessarily culturally mediated. There’s this whole spectrum of social distress indicators that start exploding and blinking red really fast as inequality passes through various stages. Right now in the developed world, the United States is the most unequal society in the developed world. UK is number two, and everybody else is way, way behind.

The reason why of course is Reaganism and Thatcherism. It’s dropping the top tax bracket from 74% here and from in the 60s in the UK, down into the 20s right now, here and the 30s for individuals. I’m not sure what it is in the UK but same fact. Picket and Wilkerson have documented that brilliantly.

Nick Hanauer:

Yeah, and I think, I mean, this aligns a lot with our own thinking and research, which is that what people fail to acknowledge I think certainly academic economists too, is that humans are wetware, right? We are creatures, biological creatures that evolved over millions of years. Our success is a consequence of high levels of cooperation, which in turn rely on very particular kinds of justice and fairness. Because you can’t cooperate if things aren’t fair and just. That’s why the differences stretching a society apart economically shreds the reciprocity norms that make social cohesion possible. We’re witnessing that right now in our country.

Thom Hartmann:

Yeah. In fact, one of the most interesting that Wilkerson and Pickett have documented, and they can show state-to-state variations in the United States and country-to-country variations around the world, is that as inequality goes up so trust interpersonal trust and trust in government-

Nick Hanauer:

Goes down. Absolutely, and so does happiness, right? Because humans are status-seeking creatures and in a society where everybody’s doing reasonably well and not too differently, even if you’re relatively poor, people are relatively happier. In a society where most people are doing terribly relative to a privileged few, people are pissed off.

Thom Hartmann:

It’s not so much I don’t think status adds survival. In that regard, I don’t think we’re wired that differently than other mammals. They did a fascinating study back in the ’70s at Michigan State University, squirreled typically like nests in trees. You can see them in the winter when the trees lose their leaves. So what these researchers did… There are all these hardwood trees all over the MSU campus. What they did was they took a couple of the squirrels’ nests and added leaves to them. They increased their size by about 20%, but they didn’t increase the size of the rest of the squirrels. What they found was that over the next six months, all the other squirrel nests got larger too.

In other words, all the squirrels had to keep up with the Joneses. This was on piggyback on research that they had been doing for years on the size of these squirrels’ nests and other animal burrows relative to climate because Michigan has pretty hard winters. What they found was that the squirrels were actually predicting how severe the winter was going to be. So they build bigger nests when the winter was going to be harsher and nobody to this day understands exactly how squirrels know that. There’s a lot of things that they’re probably paying attention to, changes in atmospheric pressure, precipitation or whatever, God only knows, but the squirrels can predict it.

So when the squirrels noticed that some of the other squirrels had bigger nests, they at some level just assumed, “Oh my God, Ralph, over there know something about the weather that’s coming that I don’t. I better get ready.” So we have this instinct wired into us. This is part of a million DNA. So when we see people who are living wildly luxurious lifestyles, it’s not a matter of I’m jealous of that person because I want what they want. There’s something much deeper and more visceral. There’s a sense that’s rarely articulated. Most people are completely unconscious to this, but there’s a sense that I’m not as prepared to survive what may be coming in the winter as that person is and that freaks me out.

Nick Hanauer:

Yeah. Well, I mean, we could devote our entire podcast to discussing this particular thing, but I think there’s a of social science that indicates that people are pretty status conscious, too. But-

Thom Hartmann:

Oh, yeah. Well, what I’m saying is I’m absolutely agreeing with you and I’m saying that the foundation of status consciousness actually has a survival.

Nick Hanauer:

Oh, it’s a survival instinct. Oh, absolutely-

Thom Hartmann:

Right.

Nick Hanauer:

… and if this is baked into our DNA, which is why economic policy matters so much more in human terms than it does if you look at it on a spreadsheet and think, “Why this view,” that, “Well, let them eat iPhones.” It just doesn’t work, right? It’s not enough to give people an iPhone. They actually want to feel like they’re doing reasonably well relative to others and that’s why inequality is so dangerous to democracies.

So given recent events, as sad as it may be, folks like you and us who have been warning about this for a very long time are now both in a position of having to say, “We told you so,” but also I think it’s really important to be pointing the way towards solutions. So let’s talk about that. Where should we go from here?

Thom Hartmann:

Eat the rich.

Nick Hanauer:

Yeah, that’s pretty much it.

Thom Hartmann:

[inaudible 00:20:43]. I don’t mean it literally, but it is a very simple solution. Franklin Roosevelt imposed it in the 1930s. You raise the top tax bracket up to 90% or even 74%, which is where it was when Reagan came into power, anything over 50% seems to stabilize economies very rapidly and diminish inequality. So you raise that top tax bracket, you raise the top brackets for the inheritance tax, the estate tax that Teddy Roosevelt put into place back in the first decade of the 1900s, and you institute a wealth tax. Now with regard to the wealth tax, there’s a two-step thing here. Most Americans when you say wealth tax, they think, “Oh my God, you’re going to tax things that I own, my wealth? Oh, that’s terrible. We can’t do that. We never did that in America.” That’s the kind of feedback you get.

The fact of the matter is I pay a wealth tax every year. The largest store of wealth that I have is my house and that’s true of most middle-class Americans. Every year I pay here in Portland, I think it’s around 4% of the value of my house, I pay in property taxes. That’s a wealth tax. There is no similar wealth tax on the largest store of Charles Koch’s wealth, his money bin. Yeah, what we need to do to have a money bin taxed basically if roughly 70% of American families who own their own homes and the other 30% who are renting, excluding homeless people who are also paying property taxes indirectly in the ground, we’re all paying a wealth tax every single year that’s well over 1% in almost every state in the country.

Nick Hanauer:

Correct.

Thom Hartmann:

Then why don’t we ask billionaires to pay a wealth tax on their largest share of wealth, whatever that may be.

Nick Hanauer:

So I have never heard that framed in that way and I must say that’s a very powerful narrative.

Paul Constant:

So say you’re Joe Biden and you have a slim lead in the House, 50 plus one votes in the Senate and you have decided to make dismantling oligarchy, your number one priority. What could you realistically do first?

Thom Hartmann:

I think the three things that I just laid out. They need to be sold to the American public. He needs to be doing like Franklin Roosevelt every week. Franklin Roosevelt did a Fireside Chat. Obama did not do this. Bill Clinton was a little better with the media, but Obama just stayed in the background and was quiet. Even when Merrick Garland was being trashed by Mitch McConnell, Obama could have held a daily press conference yelling about it, but he chose not to. I am very hopeful that Biden does not try to reinvent the administration that he was the number two in and instead uses FDR as its role model, or for that matter Donald Trump as his role model.

Speak to the American people regularly, make your case, make it in succinct pithy points. I think I’ve made some of those points. Every working class, American pays a wealth tax. Why not the billionaires? Why is it that the sheriff income paid in taxes for average working people as billionaires paid well less than five or 10% of their share of income compared to the average person? The numbers are even different from that. I’m sorry, I shouldn’t just pull numbers out.

Basically just boil this stuff down and pitch it. Bernie does a really, really good job of this. Joe Biden should bring him in as an advisor frankly. Because if we don’t deal with this inequality crisis that we have in the United States, we’re going to continue to have and you’re going to see even worst versions of our lack of trust crisis.

Nick Hanauer:

Yeah.

Paul Constant:

America loves a billionaire though. I think it was last week, Elon Musk past Jeff Bezos to become the richest person in the world. It occurred to me that if I were to start a kick starter to raise funds to get Jeff Bezos back above Elon Musk, there would be a non-zero number of people who would donate to that fund, it seems to me to be a uniquely American issue. Is there anything you think that people can do to directly convince people that what is in the best interest of billionaires is not in their own best interest? Because anybody who’s gotten into a fight online can tell you that people love to carry the water for billionaires.

Thom Hartmann:

Yeah. Well, I think saying it the way you just said it is a good start. I think that we have this Disney view of Kings and Kingdoms and great wealth, which is the American analog to that, that bubble needs to be punctured. That myth needs to be broken up if that makes sense. I’m not sure exactly how to do it, but I think that our media, the way that our media characterizes great wealth with shows billions and things like that, it doesn’t quite capture the reality of it.

Nick Hanauer:

No, for sure not. I’m just interested in your perspective on this. Our podcast is devoted to mostly the way in which the economics profession has aided and abetted this crisis over the last 45, 50 years. The way in which neoclassical economics and it’s the sort of weaponized ideological extension of that which we call neo-liberalism has infected the brains of people both on the right and left and left us with a set of policies that lead inevitably. Neo-liberalism is effectively a protection racket for the very rich as is neoclassical economics. I’m interested in how you see that, how you think about the connection between that and oligarchy.

Thom Hartmann:

Well, there’s a feedback loop there that produces a cycle that starts spinning at the ground level and then as it spins faster and faster, it gets wider and wider, goes higher and higher up like a helicopter. That cycle is that you get very, very wealthy people who discover that there are some economists who are saying things that would help them enhance their wealth. The example in my mind is [Joe Corse 00:27:07] and the Scaife family and Chicago school economist-

Nick Hanauer:

Yeah, and the-

Thom Hartmann:

Milton Friedman.

Nick Hanauer:

Milton Friedman and that crowd [crosstalk 00:27:20].

Thom Hartmann:

Obscure guy in the late 1950s, early 1960s. He’s considered a crackpot. He starts getting funded by some very rich people and they raise his profile. I mean, even to the point of funding a deal with a bank to create an economic prize in Memorial of Alfred Nobel that has nothing to do with the Nobel committee in Norway; this is out of Sweden, so that they can give a Nobel Prize to Milton Friedman.

So the billionaires find their economists then get lifted into the public sphere and their ideas get promoted by the billionaires. Their ideas cause changes in tax policy and economic policy that shovel more wealth to the billionaires and so now they don’t have this one economist or even a small group of economists. Now you’ve got a situation where the Coke network for the last 30 years has actually been funding departments of economics and political science in colleges all over the country. Then you’re producing brand new economists and lawyers and politicians who believe that oligarchy is actually the best form of government, which is basically a sales [inaudible 00:28:35] forward. It’s a variation on Thomas Hobbes’s notion that without the iron fist of church or state mankind will revert to his natural state in life. Life will be nasty, short and brutish. They’re just applying that same logic with lots of fancy dressing.

Again, that cycle needs to be broken or it’s ultimately self-destructive. I think a good metaphor is football. If the NFL was to decide that whichever team in a particular game have more money, would be able to have more players on the field. Instead of having to travel 10 yards to get down, they’d only have to travel five yards and there was if the rules were different for the richest team versus the poorest team. At first it might seem interesting and eventually you’d end up with just a couple of teams that were very, very original. That kind of might seem interesting, but the game itself, the appeal of the game would completely collapse and eventually football would eventually collapse. I mean, it would go through what would appear to be golden period and then it would collapse.

Frankly, I think that’s where we’re at right now, because the rules of the game of economics are defined by politics, which has been captured by one particular economic player, the very, very rich and large corporation, two economic players. History just shows that doesn’t stand. I mean, that’s the other thing too. I mean, in 1770, there was a massive depression in the English-speaking world that was a result of the French-Indian wars ending two years earlier. There was no more demand for war materials and just, I mean, there was a massive depression in 1770 that led right to the American revolution.

There was a massive depression in 1856. Abraham Lincoln had been paid for his work by our railroad. He literally ran to the bank to turn it into cash because he knew this was coming the next day. Most of the banks in America closed in 1856, or at least in Illinois where he lived at the time. That panic of 1856 led right to the Civil War. You’ve got the Great Depression. The Great Depression hit the United States and Germany equally hard. We had FDR as a president, but Germany had Hitler. Boom, World war II, caused by a depression in large part. Here we are again so these things are self-correcting, but the correction process can be brutal.

Paul Constant:

We ask all of our guests why they do this work. We’ve had you on the show before and I’ve asked you that question. So I thought I’d get a little more specific. Why did you choose now to focus on oligarchy?

Thom Hartmann:

Because I feel that we are at that crisis point we’re at that 1929, 1856, 1770 turning point that to a large extent as being defined by economics and the oligarchic class. If we are well-informed about how these things work and lessons of history, we can make it through. If we’re not well-informed, then we end up like Germany did in 1935.

Nick Hanauer:

Yeah. Given recent events, I think we should all be very sober and it’s not impossible that these are end of days.

Thom Hartmann:

No, we are at the cusp or close to the cusp of a major turning point in American history. The question is which way is it going to change. I’m trying [inaudible 00:32:04] it should turn in the direction of the ideals of the Declaration of Independence, life, liberty, and the pursuit of happiness rather than Thomas Hobbes’s vision of you’ve got to have a brutal state in order to maintain social order, which is obviously Trump moving to.

Nick Hanauer:

Yeah. Well, Thom, thank you so much for joining us.

Paul Constant:

Thank you so much.

Nick Hanauer:

Thank you for your work and we hope to talk to you again soon.

Thom Hartmann:

Well, thank you for having me. Anytime.

Nick Hanauer:

That was a super interesting conversation. Didn’t have a lot of nice things to say about my people though, did he?

Paul Constant:

No, no. Are you up inked? Are your feelings hurt a little bit?

Nick Hanauer:

Was it eat the rich?

Paul Constant:

He did say eat the rich, yeah. That’s the turning point, yup.

Nick Hanauer:

Oh, golly.

Paul Constant:

I hope I’m moisturizing, because be a little gamey.

Nick Hanauer:

Exactly. First marinate them in buttermilk for 24 hours then eat them.

Paul Constant:

How do you feel about that thesis statement?

Nick Hanauer:

The sad part is, and again, when I’m thinking about this stuff right now, I’m definitely thinking about it in the context of what happened at our nation’s capital and just the extraordinary seditious behavior of so many Republicans and just the fact that like I’ve been saying for a long time the Pitchforks are coming. What’s really top of mind for me right now is that I’ve been talking about this stuff and warning people for a while that a pluralistic, democratic, stable, civil society can’t survive if inequality gets too extreme. The truth is that with virtually no exceptions, my peers do not, will not face this.

Paul Constant:

Mm-hmm (affirmative).

Nick Hanauer:

I’ve talked to dozens, maybe hundreds of wealthy people about engaging in projects or programs or politics directly that will begin to recast how we organize society. I cannot tell you the number of plutocrats I’ve talked who were like, “Do we have to save the middle class? Absolutely.” When you tell them what’s necessary to do that like pay people more or pay higher taxes, they’re like, “Ah, fuck that. Why, I didn’t think you mean that,” right? That’s crazy.

What’s incredibly depressing is that otherwise intelligent people don’t have the psychological capacity to recognize that the system that has so benefited them and has created these pathologies that these things are connected that the people who have benefited the most may be responsible also for the pathologies, right? They simply cannot bring themselves to believe that in order for the country to do better, they may have to do slightly worse, right? It creates so much cognitive dissonance that they can’t bring themselves to accept that.

Paul Constant:

To be clear, the doing worse is not moving into a smaller house or anything.

Nick Hanauer:

No, no, no. [inaudible 00:35:49] absolutely no trade offs in terms of how they live, but the idea of paying more taxes or having to pay your people enough to get by without food stamps I guess what it does lead me to is that if you really do want to solve this problem, you are actually going to have to eat the rich.

It is probably true that every billionaire is a policy failure in a democracy. I can’t remember who said that. I think it was one of AOC’s people, but it’s probably literally true and that’s just really depressing. Because you want to believe that the people at the top could see themselves to more directly participating in keeping the whole society together, even if it involved some direct trade offs and they can’t.

I can tell you for certain that I’ve talked to like jillions of them. There are a couple of notable exceptions, not very many, but they think that if they vote for Democrats that’s as far as they need to go. If we’re honest with ourselves, there is not yet any direct evidence that Democrats will solve this problem.

Paul Constant:

Well, yeah. I mean, we’re recording this now before Joe Biden’s inauguration to be clear so, yeah.

Nick Hanauer:

Okay, but certainly if you look over the last 40 years.

Paul Constant:

Sure, yes.

Nick Hanauer:

Yeah. There’s not a lot of great evidence that the Democratic party is going to effectively become the, I mean, believe, I mean, Paul, we’re Democrats and we’re super involved in that, give a lot of money away to Democrats and all that stuff. The truth is that if the people don’t organize directly around making these changes, then the Democratic party is unlikely to be the only place where this change comes from. So anyway, I don’t know. It is definitely. I think everybody in the country who has a brain is reflecting and add some buttermilk, I guess, would be my advice.

Paul Constant:

We’ve really gone on a journey today and I think that to better understand how we wound up here and how our opinions are changing about oligarchy and the rich I think you should definitely check out Hidden History of American Oligarchy. It’s part of a series of these books that he does. The research is really incredible. It’s written in very simple language, but it’s full of all kinds of great information about America’s history. It’s available where all books are sold, although I personally would recommend you bought it from an independent bookstore rather than Amazon.

Nick Hanauer:

Next week on Pitchfork economics. We’re going to answer all your questions in another ask-me-anything episode. Looking forward to it.

Announcer:

Pitchfork Economics is produced by Civic Ventures. If you liked the show, make sure to subscribe, rate and review us wherever you get your podcasts. Find us on Twitter and Facebook at Civic Action and Nick Hanauer. Follow our writing on Medium at Civic Skunk Works and peek behind the podcast scenes on Instagram at Pitchfork Economics. As always, from our team at Civic Ventures, thanks for listening. See you next week.