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October 30, 2014

Ultra-Rich Hijacking American Politics

A national investigative reporter has written a new book detailing his efforts to trail conservative and liberal mega-donors who have helped pump $2.5 billion into American politics.

“Big Money: 2.5 Billion Dollars, One suspicious Vehicle, and a Pimp – on the Trail of the Ultra-Rich Hijacking American Politics,” byKenneth P. Vogel, has been published by PublicAffairs. Vogel is the chief investigative reporter for Politico.

A Politico article mentions some of the highlights of the book, including Karl Rove’s advising of the Sheldon Adelson-funded Freedom’s Watch prior to the 2008 election; Koch’s operatives counter surveillance efforts at a 2014 California seminar on future elections; Obama’s pledge to big donors in 2012 to pursue a constitutional amendment to counteract the Supreme Court’s Citizen United decision; and the funding support of Rep. Alan Grayson, D-Fla., and George Soros, for Democracy Alliance.

  • James A. DeHart

    Don’t forget the middle class, Yonatan C. We are being penalized by our government to the point of none existence. Now is the time to start thinking seriously about replacing our government, with one that is truly there to serve for the benefit of ‘we the people’.

  • http://seekingalpha.com/article/1514632 lottopol

    “..In free-market capitalism, capital generates income for the owners of the capital which in turn is used to create additional capital. This is very good. Sometimes, it can be actually too good. As capital continues to accumulate, its owners find it more and more difficult to deploy it efficiently. The business sector generally must interact with the household sector by selling goods and services or lending to them. When capital accumulates too rapidly, the productive capacity of the business sector can outpace the ability of the household sector to absorb the increasing production.

    The capitalists, or if you prefer, job creators use their increasing wealth and income to reinvest, thus increasing the productive capacity of the business they own. They also lend their accumulated wealth to other businesses as well as other entities after they have exhausted opportunities within the business they own. As they seek to deploy ever more capital, excess factories, housing and shopping centers are built and more and more dubious loans are made. This is overinvestment. As one banker described the events leading up to 2008 – First the banks lent all they could to those who could pay them back and then they started to lend to those could not pay them back. As cash poured into banks in ever increasing amounts, caution was thrown to the wind. For a while consumers can use credit to buy more goods and services than their incomes can sustain. Ultimately, the overinvestment results in a financial crisis that causes unemployment, reductions in factory utilization and bankruptcies all of which reduce the value of investments.

    If the economy was suffering from accumulated chronic underinvestment, shifting income from the non-rich to the rich would make sense. Underinvestment would mean there was a shortage of shopping centers, hotels, housing and factories were operating at 100% of capacity but still not able to produce as many cars and other goods as people needed. It might not seem fair, but the quickest way to build up capital is to take income away from the middle class who have a high propensity to consume and give to the rich who have a propensity to save (and invest). Except for periods in the 1950s and 1960s and possibly the 1990s when tax rates on the rich just happened to be high enough to prevent overinvestment, the economy has generally suffered from periodic overinvestment cycles.

    It is not just a coincidence that tax cuts for the rich have preceded both the 1929 and 2007 depressions. The Revenue acts of 1926 and 1928 worked exactly as the Republican Congresses that pushed them through promised. The dramatic reductions in taxes on the upper income brackets and estates of the wealthy did indeed result in increased savings and investment. However, overinvestment (by 1929 there were over 600 automobile manufacturing companies in the USA) caused the depression that made the rich, and most everyone else, ultimately much poorer.

    Since 1969 there has been a tremendous shift in the tax burdens away from the rich and onto the middle class. Corporate income tax receipts, whose incidence falls entirely on the owners of corporations, were 4% of GDP then and are now less than 1%. During that same period, payroll tax rates as percent of GDP have increased dramatically. The overinvestment problem caused by the reduction in taxes on the wealthy is exacerbated by the increased tax burden on the middle class. While overinvestment creates more factories, housing and shopping centers; higher payroll taxes reduces the purchasing power of middle-class consumers…”
    http://seekingalpha.com/article/1543642

  • John Lovrich

    If you hold down the long key at either end of the forth row, you can make lower case letters.

  • The Beech Bums

    The seductive nature of our latent instincts is exploited relentlessly by those who oppose liberty and understand the power of the instincts and emotions to which they appeal.

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