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Excerpt: "Talk about your friendly skies. No wonder the people with money and influence don't feel connected to the rest of the population. It's as if they live in a foreign country at the top of the world, like their own private Switzerland, at heights so rarefied they can't imagine life down below."

Bill Moyers. (photo: PBS)
Bill Moyers. (photo: PBS)



The Rich Are Different From You and Me

By Bill Moyers and Michael Winship, Bill Moyers & Company

14 April 12

 

enjamin Franklin, who used his many talents to become a wealthy man, famously said that the only things certain in life are death and taxes. But if you’re a corporate CEO in America today, even they can be put on the back burner - death held at bay by the best medical care money can buy and the latest in surgical and life extension techniques, taxes conveniently shunted aside courtesy of loopholes, overseas investment and governments that conveniently look the other way.

In a story headlined, "For Big Companies, Life Is Good," The Wall Street Journal reports that big American companies have emerged from the deepest recession since World War II more profitable than ever: flush with cash, less burdened by debt, and with a greater share of the country’s income. But, the paper notes, "Many of the 1.1 million jobs the big companies added since 2007 were outside the U.S. So, too, was much of the $1.2 trillion added to corporate treasuries."

To add to this embarrassment of riches, the consumer group Citizens for Tax Justice reports that more than two dozen major corporations - including GE, Boeing, Mattel and Verizon - paid no federal taxes between 2008 and 2011. They got a corporate tax break that was broadly supported by Republicans and Democrats alike.

Corporate taxes today are at a 40-year-low - even as the executive suites at big corporations have become throne rooms where the crown jewels wind up in the personal vault of the CEO.

Then look at this report in The New York Times: Last year, among the 100 best-paid CEOs, the median income was more than $14 million, compared with the average annual American salary of $45,230. Combined, this happy hundred executives pulled down more than two billion dollars.

What’s more, according to the Times "… these CEOs might seem like pikers. Top hedge fund managers collectively earned $14.4 billion last year." No wonder some of them are fighting to kill a provision in the recent Dodd-Frank reform law that would require disclosing the ratio of CEO pay to the median pay of their employees. One never wishes to upset the help, you know. It can lead to unrest.

That’s Wall Street - the metaphorical bestiary of the financial universe. But there’s nothing metaphorical about the earnings of hedge fund tigers, private equity lions, and the top dogs at those big banks that were bailed out by tax dollars after they helped chase our economy off a cliff.

So what do these big moneyed nabobs have to complain about? Why are they whining about reform? And why are they funneling cash to super PACs aimed at bringing down Barack Obama, who many of them supported four years ago?

Because, writes Alec MacGillis in The New Republic - the president wants to raise their taxes. That’s right - while ordinary Americans are taxed at a top rate of 35 percent on their income, Congress allows hedge fund and private equity tycoons to pay only pay 15 percent of their compensation. The president wants them to pay more; still at a rate below what you might pay, and for that he’s being accused of – hold onto your combat helmets – "class warfare." One Wall Street Midas, once an Obama fan, now his foe, told MacGillis that by making the rich a primary target, Obama is "[expletive deleted] on people who are successful."

And can you believe this? Two years ago, when President Obama first tried to close that gaping loophole in our tax code, Stephen Schwarzman, who runs the Blackstone Group, the world’s largest private equity fund, compared the president’s action to Hitler’s invasion of Poland.

That’s the same Stephen Schwarzman whose agents in 2006 launched a predatory raid on a travel company in Colorado. His fund bought it, laid off 841 employees, and recouped its entire investment in just seven months - one of the quickest returns on capital ever for such a deal.

To celebrate his 60th birthday Mr. Schwarzman rented the Park Avenue Armory here in New York at a cost of $3 million, including a gospel choir led by Patti LaBelle that serenaded him with "He’s Got the Whole World in His Hands." Does he ever - his net worth is estimated at nearly $5 billion. Last year alone Schwarzman took home over $213 million in pay and dividends, a third more than 2010. Now he’s fundraising for Mitt Romney, who, like him, made his bundle on leveraged buyouts that left many American workers up the creek.

To add insult to injury, average taxpayers even help subsidize the private jet travel of the rich. On the TimesDealBook blog, mergers and acquisitions expert Steven Davidoff writes, "If an outside security consultant determines that executives need a private jet and other services for their safety, the Internal Revenue Service cuts corporate chieftains a break. In such cases, the chief executive will pay a reduced tax bill or sometimes no tax at all."

Are the CEOs really in danger? No, says Davidoff, "It’s a common corporate tax trick."

Talk about your friendly skies. No wonder the people with money and influence don’t feel connected to the rest of the population. It’s as if they live in a foreign country at the top of the world, like their own private Switzerland, at heights so rarefied they can’t imagine life down below.

 

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+29 # jlohman 2012-04-14 09:57
Isn't this unique? The rich find ways to cheat the poor, but when this is all over, who is going to protect them from their own security guards?
 
 
+4 # RLF 2012-04-15 05:26
The danger in this little scam by the wealthy is that when enough lower and middleclass people realize that they being screwed...they will become corrupt. If you can't get paid then you get over. In the coming years we will look more and more like Greece. Les of the real economy on the books and more under the table. Then they will raise taxes on small business and the self employed again even though we are screwed on a daily basis now. If we can't get a better government than those like Obama bring us...this country is doomed.
 
 
+35 # KrazyFromPolitics 2012-04-14 10:32
Thanks, Bill Moyers for your ongoing pursuit of the truth. Continue to educate the public with the clarity and fairness that you have always demonstrated over the years. Hopefully, through the efforts of journalists such as you, and others, the American public will wake up to the erosion of their freedoms, piece-by-piece.
 
 
+9 # reiverpacific 2012-04-14 11:06
But are they REALLY happy, or perpetually discontented with the "It's never enough" mindset, and ever fearful that their power over others be diminished? They get sick, have to piss, shit and die in one way or or at one time or another like the rest of us*.
In almost every philosophy I'm aware of and even the exemplary lives of the founders of most enduring religious doctrines (almost universally, materially poor), true richness exists in the manner of living to the max', seeking, creativity, culling, growing and sharing abilities and acquisitions with others, especially the less fortunate among us.
It seems to me that these designated as "Wealthy" tend to box themselves in and limit their existences to association with a false elite and an illusion of purchased freedom. -There are exceptions to everything of course.
*As Old Khyam wrote much more elegantly;
"Think in this batter'd Caravanserai
Whose doorways are alternate night and day,
How Sultan after Sultan with his Pomp
abode his Hour or two, -and went his way".
 
 
+22 # pgobrien 2012-04-14 11:36
All well and good for those of us with resources enough to get through each day, but these "wealthy" are sucking up the resources needed by so many just to put food on the table and keep a roof over the heads of their children. It's unconscionable, even if they aren't made happy by their ill-hoarded lucre.
 
 
+11 # reiverpacific 2012-04-14 12:30
Quoting pgobrien:
All well and good for those of us with resources enough to get through each day, but these "wealthy" are sucking up the resources needed by so many just to put food on the table and keep a roof over the heads of their children. It's unconscionable, even if they aren't made happy by their ill-hoarded lucre.

I absolutely agree with you!
As one of the "New Poor" myself, I keenly feel your righteous anger and am certainly not trying to make any points for them. In fact I will (as best I can) support and join any movement that will bring them down to a level less or non-plutocratic on behalf of the rest of us and by extension global Democracy if ever possible.
I'm just pointing out in perhaps a rather torturous way that we can live more fulfilled lives in spite of them, as they are essentially an anti-social body, whereas we have each other and the first thing we need to recognize that they are trying to reduce us to their level of non-comprehensi on by isolating us from our critical mass.
I wish you the best and please try to laugh at them and their pitiful "divide and conquer" tactics through the pain, save some energy for yourself and hopefully your betterment and getting to know those who are with you.
 
 
+7 # James38 2012-04-14 18:41
Reiver, we can and should not just laugh at them. That is too glib, since it ignores a major basic problem – they don’t care if we do, and it lets them get away with murder.
Society generates all wealth - no wealthy person ever gets rich by themselves. Their wealth is generated by a cooperative (willing or known or not) effort involving the accumulated and collected work and energy of the entire society, building roads, providing police and fire protection, infrastructure, education for the workers, regulating standards, providing constant food supplies, on and on.

What this means is that a significant part of that wealth belongs to society, and must be retained by society through taxation in order to fund education, health, and other services. Otherwise the wealthy will grab and keep a disproportionat e part of the total wealth available. The wealthy have been famous throughout human history for keeping an excessive share of the total wealth. They use their skills at managing and manipulating the structure of society for their personal gain, and fail to respect the source of the wealth, leaving the essential workers in poverty. Then they use that wealth for self-aggrandize ment (monuments, hyper-luxurious palaces, boats, royal courts, etc) and go further by creating conflict and useless wars with other oligarchs using a variety of pretexts. Our latest grotesque example of just this sort of greed driven madness was GW Bush’s war in Iraq.
 
 
+6 # James38 2012-04-14 18:46
(continued)

The very concept of an educated populace and freedom of thought and democracy flies in the face of the long established goal of the wealthy to keep the workers ignorant and subservient - just so the wealthy can become grossly and excessively wealthy.

This is not something the rich fail to understand consciously. Quite the opposite, their efforts to diminish potential competition for a reasonable share of societies wealth are well established. The current de-funding of public education coupled with extreme increases in tuition for higher education has the effect of keeping the public ignorant and subservient. Even those who manage to get a degree are so saddled with debt that they must submerge themselves in service to the economic system in order to pay off their debt. By the time that is done, they have been beaten into a role and a limited idea of what is possible. They have become cogs in the big machine, unable to break out or even recognize the similarity of their subservience to that of the poor.

(continued)
 
 
+7 # James38 2012-04-14 18:47
(continued)

The diabolical cleverness of the latest massive effort to curb public freedom of thought and rights is to masquerade it as a defense of “freedom”. The Far-Right machine has convinced major numbers of the poor and remnants of the middle class that “socialism” is their enemy, that the “free market” will somehow generate better and more jobs, that “privatization” , even of public education, will help them, that “globalization” is a good idea, that a single payer insurance program is inferior to either no insurance or private insurance for profit – the list goes on. The Republican theory of government is being made to appear to defend personal freedoms, while its actual effect is to drive everyone but the rich into a form of slavery and ignorance. Go read “1984” by George Orwell, or at least read the Wikipedia article about it. Published in 1949, I read the book not long after it came out. I was thoroughly frightened by it, and am very glad I read it. One amusing sidelight is that at the time, I thought 1984 was an impossibly far distant future, one that would never arrive in my lifetime. Instead, I now find myself watching the Republican Party degenerating into just that kind of Authoritarianis m and restriction of freedom.

(Continued)
 
 
+8 # James38 2012-04-14 18:48
(continued)


Orwell was a little premature. If he had named the book “2013” he would have been even more prophetic. We have serious danger staring us in the face, and the cold dead eyes are of the recalcitrant 1%, embodied by such vicious stalwarts as Dick Cheney, Grover Norquist, the staff and owners of Faux Snooze, Mitt Romney, Condi and Shrub, Boehner, The Supreme Corporate Flacks topped by the ever-so-impeach able Thomas, etc.

We unfortunately can’t laugh this one off. We need to do serious work to re-elect Obama and give him a Congress he can work with. If we screw this election up by not getting out to vote, and by not being active enough, we will pay a severe price.
 
 
+8 # James38 2012-04-15 00:01
I recommend that you read "Conservatives Without Conscience" by John Dean. He describes what has happened to the formerly conservative, now radical, Republican Party.

Also, to provide a necessary overview of the future of humanity if we allow "Business as Usual" to continue, read "Storms Of My Grandchildren" by Dr James E Hansen, eminent climate scientist at NASA.
His book shows that the crazed concentration on arrogation of more wealth by the 1% will not only distort society and destroy democratic progress, it will destroy the climate we all depend on for our very survival. That is not just outrageous greed, that is raving madness.
 
 
+1 # reiverpacific 2012-04-16 11:39
Quoting James38:
I recommend that you read "Conservatives Without Conscience" by John Dean. He describes what has happened to the formerly conservative, now radical, Republican Party.

Also, to provide a necessary overview of the future of humanity if we allow "Business as Usual" to continue, read "Storms Of My Grandchildren" by Dr James E Hansen, eminent climate scientist at NASA.
His book shows that the crazed concentration on arrogation of more wealth by the 1% will not only distort society and destroy democratic progress, it will destroy the climate we all depend on for our very survival. That is not just outrageous greed, that is raving madness.

Vot a lecture!
I'm not being glib, -I have my spells of hot anger too; so PLEEZE excuse me for having an incurable sense of humor, even in the midst of the hardest five years I've ever experienced as a small business owner barely able to keep going.
-I have my own extensive socio-political -history library, so don't need a patronizing lecture from the likes of you about the mentality of the plutocracy! I've met many of them and been subject of direct threats from their shills and goons in more than one country. Have you had any direct experience to draw on in this and any other context, or are you one of those wearisome armchair activists who disappear so swiftly when things get hot?
"In all their promises of paradise, you will not hear one laugh" -Bob Dylan "The Gates of Eden".
 
 
+1 # James38 2012-05-01 09:56
Reiver, since I am writing this on an old thread, I will post it in your message box. While I am glad that you appear to actually have read my "Vot a lecture",I am not sure I was incorrect to suggest you might be a little off in the "glib" direction. Your statement "...try to laugh at them and their pitiful "divide and conquer" tactics through the pain...." is profound yet could be misleading if it underestimates the manipulation of the isolation and the lack of effective means for the rest of us to cooperate to create a decent society. We desperately need a fully funded education system if we want to raise consciousness of enough people to make real additional changes, and I fear we are being driven away from that goal. I was a student in California, graduating high school in 1956, when that education system was truly excellent. It has been destroyed since then. The loss is incalculable. There the financial pressure came in part from property owners restricting property taxes, which means that the minds of the middle and upper middle classes have been poisoned by greed and selfishness as have the rich. This is terribly dangerous, and is part of the "strength" of the Republican party. We are dealing with forces operating over long time spans, and we need the means to deal with them, and that means the government, which is increasingly arrayed against us. The tactics of the rich may be "pitiful" in the moral sense, but they are working.
 
 
+1 # James38 2012-05-01 10:46
I am writing this since your contributions are interesting, but I find this " don't need a patronizing lecture from the likes of you..." to be ludicrously "patronizing" and demeaning. My "lecture" was directed at the general discussion, not just you, and in any case was not "patronizing", but heartfelt. You go on to suggest on the basis of no more evidence that I may be a "wearisome armchair activist who disappear so swiftly when things get hot".

Not quite. I was possibly the first to refuse to be drafted for the Vietnam debacle, and fully accepted that I might be jailed for the act. I continued to actively protest that war, and the House Unamerican Activities Committee under the monstrous Senator McCarthy. I remain an activist, and have turned my interests toward analyzing the Global Warming problem and writing about it. If you want an issue that demands understanding the far-right craziness, try to figure out how to get the religionuts to comprehend not just the dire warming/climate change issue, but to accept the need for easy access to contraceptives globally to curb population growth.

If you have any non-snide suggestions as to how I can become a more effective thinker and activist, by all means make them clear. I am hoping for a productive conversation with as many thinking individuals as possible.
 
 
+4 # terrison 2012-04-14 16:53
Does it really matter, the existential "happiness" of the rich? I would say of course they're not, otherwise they would be happy to let the rest of us have a slice of the pie. But whether they are happy or not, their actions are immoral. Morality should not depend on "what makes me happy", but on what is right and wrong inherently, And what is the best outcome for all. In other words the greater GOOD.
 
 
+7 # afrizunk 2012-04-14 11:19
The 15 year old son of a Wall Street trader summed it up. "First they lost their ethics and didn't know it, then they lost their families and didn't know it" Let the buyer beware. The result we're still experiencing.
 
 
+2 # jwb110 2012-04-14 11:21
Instead of comparing CEO income to the income of the "lower classes", try comparing the income of the relative to the dividends payed to stock holders.
 
 
+8 # pgobrien 2012-04-14 11:38
Why? It would be interesting, and instructive for stock-holders to see where their investments are going -- but it's the people employed by these companies, who make the companies' profits happen, who matter at least as much.
 
 
+14 # Stephanie 2012-04-14 12:16
The article above did not mention the income of the 'lower classes' it was the "average American annual salray of $45,230". The 'lower classes', perhaps someone on minimum wage, you refer to would be making FAR less than that. Seriously, one man mentioned above took home $213 MILLION in pay, etc -- that seems to me to be an obscene amount of money. When he then throws himself a birthday party and spends more than $3 million on it - then his complaining about his taxes being raise 2% is insulting and obnoxious to me -- likewise they way he makes his money, by buying companies and firing everyone - like Romney.
 
 
-13 # MidwestTom 2012-04-14 12:14
Corporate taxes are truly at a 30 year low; what is not said is that they are also the highest in the developed world. The problem isn't the tax rate, it is simply a symptom of the problem. The problem is that the Fed has created too much currency, and both of our political parties have structured rules to guarantee that the majority of the spare cash goes to the bakers and hedge fund mangers. when corporations that actually make things, make money it can only go to three places, reinvest in the business for wages and equipment; to pay the shareholders dividends for the investment; or to the government as taxes. Which is the mast productive?
 
 
+12 # DPM 2012-04-14 13:51
Taxes also benefit the broadest segment of the population, if properly spent. Ridiculous CEO wages are pretty much a waste, benefiting only a few. Paying a fair amount of tax is not "burning" the money, it is "reinvesting it in the country's infrastructure. Don't complain about paying a tax. If you want to complain, complain about how tax money is spent...often going right back to a big company as "corporate "welfare", even if they haven't contributed.
 
 
+5 # John Locke 2012-04-14 20:31
The idocracy of the large salaries these corporate robbers get, is it is off the back of the people who actually work and produce something, It would seem more prudent to pay these executives less and employ more people at least there would be more people that can purchase these same company products...
 
 
+5 # Stephanie 2012-04-14 16:18
Quoting MidwestTom:
... when corporations that actually make things, make money it can only go to three places, reinvest in the business for wages and equipment; to pay the shareholders dividends for the investment; or to the government as taxes. Which is the mast productive?


Actually, it seems to me that many of those manufacturing jobs have moved offshore. Some of those companies list an address as being their home office there too, however often it is a mailbox in a building with no real office which is done to not pay US taxes. Other places for profits to go is to hire more people, instead of laying off many and then giving yourself a huge bonus (which could have been used for salaries), More working people then contribute their taxes and buy more things which helps the economy. Just look at cities where the main employer has closed, then it is stores and other retail and it becomes a ghost town with people walking away from their homes and then there is no real estate taxes either.
 
 
+2 # Regina 2012-04-15 14:59
What makes you think that the bonus bunch gives a hoot about the entire economy? They've demonstrated their disdain by the very acts of moving production to countries of such poverty that they can get away with starvation wages and back-breaking work conditions. Then they wallow in the bonuses they issue themselves. America? That's a joke.
 
 
0 # Andrew Hansen 2012-04-16 06:14
How are corporate taxed for corps with profits like GE and Boeing and Verizon who paid no taxes, the highest in the developed world?

As the 'good book', which so many of the same are happy to thump, to whom much is given, much is required.
 
 
0 # Andrew Hansen 2012-04-16 06:16
How many businesses or share holders are building roads and schools so that these corps can become money vaccuums for a few very rich people?

By 'mast [sic] productive' do you mean most exploitive?
 
 
+7 # moby doug 2012-04-14 13:34
Midwest Tom is talking about the statutory tax rate, not the REAL or effective rate after US corporations take advantage of endless loopholes. The excerpt below is from The Center on Budget and Policy Priorities: The U.S. corporate tax burden is smaller than average for developed countries.[1] Corporations in 19 of the member states of the Organization for Economic Co-operation and Development paid 16.1 percent of their profits in taxes between 2000 and 2005, on average, while corporations in the United States paid 13.4 percent.

Nevertheless, some have argued that U.S. corporate tax rates unduly burden U.S. companies by pointing to the country’s top statutory tax rate, which is 35 percent. For example, a recent Wall Street Journal editorial calling for corporate tax cuts noted that this is the second highest top statutory tax rate among developed countries.[2] While true, this gives the false impression that the corporate tax burden is greater here than in other developed countries. Because the U.S. tax code offers so many deductions, credits, and other mechanisms by which corporations can reduce their taxes, the actual percentage of profits that U.S. corporations pay in taxes — or what analysts refer to as their effective tax rate — is not high, compared to other developed countries.
 
 
0 # MidwestTom 2012-04-14 14:30
M
 
 
+3 # DPM 2012-04-14 13:46
Perhaps more of them need to "feel the heat".
 
 
+3 # John Locke 2012-04-14 20:35
In order to realign the wealth more fairly, one of three things needs to occur: a labor Boycott: a Tax Rebellion, and or a third party that cares about the people and not lining their pocket with the money form these corporate thieves...
 
 
0 # barbaratodish 2012-04-16 02:15
Bill Moyers and Michael Winship are different from the 99% I bet!
 
 
0 # lark3650 2012-04-16 10:29
"Let me tell you about the very rich. They are different from you and me. They possess and enjoy early, and it does something to them, makes them soft where we are hard, and cynical where we are trustful, in a way that, unless you were born rich, it is difficult to understand. They think deep in their hearts, that they are better than we are because we had to discover the compensations and refuges of life for ourselves. Even when they enter deep into our world or sink below us, they still think that they are better than we are. They are different." - F. Scott Fitzgerald
 

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