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Plutocratic Insurgency Note 10: Increasing Global Wealth Concentration, Record Private Jets at Davos, and the Demise of the American Dream

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Plutocratic Insurgency Note 10: Increasing Global Wealth Concentration, Record Private Jets at Davos, and the Demise of the American Dream   

 

Pamela Ligouri Bunker and Robert J. Bunker

 

This plutocratic trifecta focuses upon the increasing global wealth concentration of the world’s billionaires—as well as the falling tax income tax rates on the rich and their corporations—discussed in a new Oxfam report, the fact that a record number of private (multi-million dollar+ jets) are ferrying global elites to the Davos meeting this year, and that a majority of the U.S. poor (per a World Economic Forum commissioned poll) now recognize that they and their children have little hope of working hard and, as a result, ever becoming rich in American society.

 

Key Information: Laura Paddison, “26 Billionaires Own The Same Wealth As The Poorest 3.8 Billion People.” Huffington Post. 20 January 2019, https://www.huffingtonpost.com/entry/oxfam-report-wealth-inequality-poverty-tax_us_5c408586e4b027c3bbbeb91d:

 

A new economic system is needed to tackle rampant inequality, says a new Oxfam report.

 

The gap between rich and poor is fracturing society, poisoning politics and fueling public anger, according to a new report from anti-poverty nonprofit Oxfam, which found that last year just 26 people owned the same amount of wealth as the poorest 3.8 billion people. This figure is down from 43 the year before.

 

The Public Good or Private Wealth? report, published Sunday, found that the wealth of billionaires has increased by $900 billion in the last year, or $2.5 billion a day. This bonanza has not been felt by the poorest half of the world, which saw its wealth decline by 11 percent.

 

Since the 2008 financial crisis, the number of billionaires has doubled, according to the report, and the very rich along with corporations are paying lower taxes than they have in decades. At the same time, 3.4 billion people are living in poverty on less than $5.50 a day, and women are often hardest hit. Men hold 50 percent more of the world’s wealth than women, according to the report….

 

Unfair tax regimes are one of the core problems highlighted by Oxfam. In wealthy countries, average top personal income tax rates fell from 62 percent in 1970 to 38 percent in 2013, according to the nongovernmental organization’s report.

 

“People generally are beginning to realize that they have been sold a bad bill of goods,” said O’Brien. “Today, 262 million kids are going to stay home because there is no funding for their education, 10,000 people today will die because they don’t have access to basic health care that could easily be funded through proper fiscal systems.”

 

While talk of poverty and inequality often focuses on the developing world, rich nations are far from immune. A report published this week by the Institute for Policy Studies, a left- leaning Washington, D.C., think tank, found that the 400 richest Americans own more wealth than all black households and a quarter of Latino households. And social mobility in America is falling. Yet Donald Trump’s administration has slashed taxes for the wealthiest. The 2017 tax bill, trumpeted as a break for the middle class, in reality was found primarily to benefit the wealthiest 1 percent.

 

In its report, Oxfam calls for a new economic model, a “human economy” where tax systems for corporations and the super-rich are overhauled to eliminate tax avoidance and evasion, and to increase tax revenues. This money would then be plowed into providing universal public services like education and healthcare as key to tackling inequality and poverty. “Inequality is not inevitable,” the report says, “it’s a political choice.”

Key Information: Max Lawson et al., Public good or private wealth? Oxford: Oxfam GB. Brief. 20  January 2019, https://www.oxfamamerica.org/static/media/files/bp-public-good-or-private-wealth-210119-en.pdf:

 

Boomtime for the world’s billionaires

 

It is 10 years since the financial crisis that shook our world and caused enormous suffering. In that time, the fortunes of the richest have risen dramatically:

 

• In the 10 years since the financial crisis, the number of billionaires has nearly doubled.

 

• The wealth of the world’s billionaires increased by $900bn in the last year alone, or $2.5bn a day. Meanwhile the wealth of the poorest half of humanity, 3.8 billion people, fell by 11%.

 

• Billionaires now have more wealth than ever before. Between 2017 and 2018, a new billionaire was created every two days.

 

• Wealth is becoming even more concentrated – last year 26 people owned the same as the 3.8 billion people who make up the poorest half of humanity, down from 43 people the year before.

 

• The world’s richest man, Jeff Bezos, owner of Amazon, saw his fortune increase to $112bn. Just 1% of his fortune is the equivalent to the whole health budget for Ethiopia, a country of 105 million people.

 

• If all the unpaid care work done by women across the globe was carried out by a single company, it would have an annual turnover of $10 trillion– 43 times that of Apple.

 

While the richest continue to enjoy booming fortunes, they are also enjoying some of the lowest levels of tax in decades – as are the corporations that they own:

 

• Wealth is particularly undertaxed. Only 4 cents in every dollar of tax revenue comes from taxes on wealth.

 

• In rich countries, the average top rate of personal income tax fell from 62% in 1970 to 38% in 2013.31 In developing countries, the average top rate of personal income tax is 28%.

 

• In some countries like Brazil and the UK, the poorest 10% are now paying a higher proportion of their incomes in tax than the richest 10%.

 

• Governments should focus their efforts on raising more from the very wealthy to help fight inequality. For example, getting the richest to pay just 0.5% extra tax on their wealth could raise more money than it would cost to educate all 262 million children out of school and provide healthcare that would save the lives of 3.3 million people.

 

• The super-rich are hiding $7.6 trillion from the tax authorities. Corporates also hide large amounts offshore. Together this deprives developing countries of $170bn a year.

 

[Citations have been removed—refer to the original document]

Key Information: Rebecca Ratcliffe, “Record private jet flights into Davos as leaders arrive for climate talk.” The Guardian. 22 January 2019, https://www.theguardian.com/global-development/2019/jan/22/record-private-jet-flights-davos-leaders-climate-talk?CMP=twt_gu:

 

David Attenborough might have urged world leaders at Davos to take urgent action on climate change, but it appears no one was listening. As he spoke, experts predicted up to 1,500 individual private jets will fly to and from airfields serving the Swiss ski resort this week.

 

Political and business leaders and lobbyists are opting for bigger, more expensive aircrafts, according to analysis by the Air Charter Service, which found the number of private jet flights grew by 11% last year.

 

“There appears to be a trend towards larger aircraft, with expensive heavy jets the aircraft of choice, with Gulfstream GVs and Global Expresses both being used more than 100 times each last year,” said Andy Christie, private jets director at the ACS.

 

This is partly due to the long distances travelled, he said, “but also possibly due to business rivals not wanting to be seen to be outdone by one another”. Last year, more than 1,300 aircraft flights were recorded at the conference, the highest number since ACS began recording private jet activity in 2013.

 

Countries with the highest number of arrivals and departures out of the local airports over the past five years included Germany, France, UK, US, Russia and the United Arab Emirates, according to ACS…

 

Key Information: Jo Confino, “Americans Have Lost Faith In Their Ability To Move From Poverty To Riches.” The Huffington Post. 21 January 2019, https://www.huffingtonpost.com/entry/american-dream-world-econo...rum-poll_us_5c4583b7e4b027c3bbc33c48?ncid=engmodushpmg00000006:

 

More than two-thirds said it’s no longer commonplace for hard work to be a path from poverty to wealth, according to a new World Economic Forum poll.

 

DAVOS, Switzerland – People in the United States and other developed countries are losing faith in the capitalist system to improve their lives, according to a new global poll commissioned by the World Economic Forum, published on the eve of its annual meeting in Davos, Switzerland.

 

Almost two-thirds of U.S. respondents said it was no longer commonplace for hard work to be a sure path from poverty to riches, with only 10 percent saying it was extremely common.

 

The lack of faith in the current system to deliver upward mobility was even more marked in Western Europe, where only a fifth of respondents said it was common to be able to start poor and become wealthy through hard work….

 

 … The WEF points to an analysis in Harvard Business Review that found that almost half of American workers surveyed said they are “often or always exhausted due to work” — up by a third in 20 years…

 

… The WEF emphasizes the importance of considering well- being rather than profit and growth at any cost. It warns that if we continue as we are, “beyond the economic risks, there are potential political and societal implications. For example, a world of increasingly angry people would be likely to generate volatile electoral results and to increase the risk of social unrest.”…

 

Key Information: SAP + Qualtrics, GLOBALIZATION 4.0: The Human Experience. Presented to the World Economic Forum. 18 January 2019, http://www3.weforum.org/docs/WEF_globalization4_Jan18.pdf:

 

 

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Who: The global rich and poor with an increasingly smaller middle class segment within Western societies and a rising—yet stunted middle class—emerging in developing countries.

 

What: Rising inequality around the world as a component of increasing predatory capitalism, as a post-modern form of dark (deviant) globalization. Laissez-faire capitalism—the invisible hand—free of state-moderation resulting in the failure of the liberal-democratic order by allowing vast sums of wealth to be concentrated within smaller and smaller segments of humanity.         

 

When: The present; January 2019.

 

Where: A global phenomena; with key information focusing on Davos, Switzerland, the perceptions of the poor in the United States, and national tax policies throughout the globe. These elite super rich are found not only within democratic societies but also within authoritarian ones. 

 

Why: Increasing wealth polarization between the world’s elites (roughly +2,200 billionaires and their families) and the rest of humanity.[1]

 

Analysis: Three interrelated themes are covered in this plutocratic insurgency note. The major takeaway from the Oxfam report—addressing the initial theme of increasing global wealth concentration—is that “Wealth is becoming even more concentrated – last year 26 people owned the same as the 3.8 billion people who make up the poorest half of humanity, down from 43 people the year before”[2]. Within the last year, the wealth of the world’s billionaires has increased by $900 billion while the world’s poorest 50% saw their wealth decline by 11%.[3] This concentration of wealth at the top is due to a recovering global economy benefiting the rich and their multinational (i.e. stateless) corporations which are pulling in record breaking profits as well as shielding more and more revenues via a) falling tax rates for the highest income brackets (in both the developed and developing world) and b) the extensive use of tax havens with some ‘$7.6 trillion’ being sheltered from sovereign taxing entities.[4] Hence, this finely tuned extractive capacity of the super rich (directed at the global masses) and their ability to achieve impunity from governmental (i.e. public goods directed) taxation represents a global economic insurgent strategy benefiting the plutocracy.

 

The second theme focuses on private jetliner records being broken at the annual Davos, Switzerland World Economic Forum (WEF) focusing on the state of the world—which also serves as a ‘behind the scenes’ ultra rich deal cutting conclave. It is closely linked to the Fourth Industrial Revolution project which seeks to ‘maximize the benefits of science and technology for society’[5], with Davos corporate executive attendance fees beginning at 60,000 francs (€53,000; $60,000).[6] This year, 1,500 private jets were expected to fly in for the WEF as contrasted with the 1,300 estimated to have flown in last year. Further, heavier expensive jets are increasingly being seen as a component of conspicuous consumption and plutocratic one-upmanship behaviors.[7] This significant increase in privatized elite transport is representative of wealth concentration amongst WEF attendees and the value that they place in attending the yearly Davos meeting for global elite networking—facilitating both corporate and family advancement—purposes.

 

The third and final theme in this note focuses on the present perceptions and mindset of the poor within American society. According to a section of the new SAP + Qualtrics poll commissioned by WEF, “Almost two-thirds of U.S. respondents said it was no longer commonplace for hard work to be a sure path from poverty to riches, with only 10 percent saying it was extremely common.”[8][9] This perception of the poor in the United States—along with the acknowledgement that their (and their children’s) chances for social mobility within America is severely limited[10]—is reflective of their disenfranchisement with 21st century Laissez-faire capitalism. It signifies the demise of the American dream linked to the Horatio Alger ‘hard work and integrity will result in your success’ mythos underpinning our belief in the fairness of our economic system and the potential to pull oneself up by one’s bootstraps to rise from rags to riches. These shifting perceptions are very dangerous from a societal cohesion perspective because they indicate that a widening perceptual—and actual according to numerous indicators—firebreak is emerging in our country between the economic elite (the plutocrats) and the masses.[11] Such increasing gulfs between the haves and have nots, if left to fester, may result in increased levels of criminality as well as street protests and other forms of civil unrest directed at what is considered to be unjust governance and a rigged economic system exploiting those on the lower socio-economic rungs of American society.            

 

Sources

 

Jo Confino, “Americans Have Lost Faith In Their Ability To Move From Poverty To Riches.” The Huffington Post. 21 January 2019, https://www.huffingtonpost.com/entry/american-dream-world-econo...rum-poll_us_5c4583b7e4b027c3bbc33c48?ncid=engmodushpmg00000006.

 

Max Lawson et al., Public good or private wealth? Oxford: Oxfam GB. Brief. 20  January 2019, https://www.oxfamamerica.org/static/media/files/bp-public-good-or-private-wealth-210119-en.pdf.

 

Laura Paddison, “26 Billionaires Own The Same Wealth As The Poorest 3.8 Billion People.” Huffington Post. 20 January 2019, https://www.huffingtonpost.com/entry/oxfam-report-wealth-inequality-poverty-tax_us_5c408586e4b027c3bbbeb91d.

 

Rebecca Ratcliffe, “Record private jet flights into Davos as leaders arrive for climate talk.” The Guardian. 22 January 2019, https://www.theguardian.com/global-development/2019/jan/22/record-private-jet-flights-davos-leaders-climate-talk?CMP=twt_gu.

 

SAP + Qualtrics, GLOBALIZATION 4.0: The Human Experience. Presented to the World Economic Forum. 18 January 2019, http://www3.weforum.org/docs/WEF_globalization4_Jan18.pdf.

 

End Notes

 

[1] Catherine Clifford, “There are a record 2,208 billionaires in the world, according to Forbes’ 2018 rich list.” CNBC. 7 March 2018, https://www.cnbc.com/2018/03/07/forbes-there-are-a-record-2208-billionaires-in-the-world.html.

 

[2] Max Lawson et al., Public good or private wealth? Oxford: Oxfam GB. Brief. 20 January 2019, https://www.oxfamamerica.org/static/media/files/bp-public-good-or-private-wealth-210119-en.pdf

 

[3] Ibid.

 

[4] Ibid.

 

[5] World Economic Forum, Centre for the Fourth Industrial Revolution. 2019, https://www.weforum.org/centre-for-the-fourth-industrial-revolution.

 

[6] “Davos 2019: What you need to know about ‘the world’s most exclusive business bash.’” The Local/AFP. 21 January 2019, https://www.thelocal.ch/20190121/davos-2019-what-you-need-to-know-about-the-worlds-biggest-business-bash-switzerland-wef.

 

[7] Rebecca Ratcliffe, “Record private jet flights into Davos as leaders arrive for climate talk.” The Guardian. 22 January 2019, https://www.theguardian.com/global-development/2019/jan/22/record-private-jet-flights-davos-leaders-climate-talk?CMP=twt_gu.

 

[8] Jo Confino, “Americans Have Lost Faith In Their Ability To Move From Poverty To Riches.” The Huffington Post. 21 January 2019, https://www.huffingtonpost.com/entry/american-dream-world-econo...rum-poll_us_5c4583b7e4b027c3bbc33c48?ncid=engmodushpmg00000006:

 

[9] SAP + Qualtrics, GLOBALIZATION 4.0: The Human Experience. Presented to the World Economic Forum. 18 January 2019, http://www3.weforum.org/docs/WEF_globalization4_Jan18.pdf.

 

[10] Ibid.

 

[11] See these recent wealth polarization statistics: “About 172,000 U.S. households have net worths of at least $25 million, Spectrem estimated last year. That’s up from 84,000 in 2008.” and Even as more young people entered the top 0.1 percent, most of their Millennial and Generation X compatriots were struggling. Americans 75 and older are the only age group whose median net worth rose from 2007 to 2016, according to the Federal Reserve Survey of Consumer of Finances released in July 2018. Typical Americans age 35 to 54 saw their wealth—heavily concentrated in housing—plunge by more than 41 percent in that time frame.” Ben Steverman, “Super Rich Americans Are Getting Younger and Multiplying.” Bloomberg. 23 January 2019, https://www.bloomberg.com/news/articles/2019-01-23/super-rich-americans-are-getting-younger-and-multiplying.

 

Further Reading

 

Jake Bernstein, Secrecy World: Inside the Panama Papers Investigation of Illicit Money Networks and the Global Elite. New York: Henry Holt and Co., 2017.

 

Anand Giridharadas, Winners Take All: The Elite Charade of Changing the World. New York: Alfred A. Knopf, 2018.

 

Brooke Harrington, Capital without Borders: Wealth Managers and the One Percent.  Cambridge, MA: Harvard University Press, 2016.

 

Paul Kennedy, Vampire Capitalism: Fractured Societies and Alternative Futures. New York: Palgrave Macmillan, 2017.

 

David Rothkopf, Superclass: The Global Power Elite and the World They Are Making. New York: Farrar, Straus and Giroux, 2009.

 

All opinions are strictly those of the authors and in no way reflect the viewpoints of any U.S. Governmental, academic, or corporate entity.  

 

About the Author(s)

Pamela Ligouri Bunker is a researcher and analyst specializing in international security and terrorism and is a past senior officer of the Counter-OPFOR Corporation. She holds undergraduate degrees in anthropology-geography and social sciences from California State Polytechnic University Pomona, an M.A. in public policy from the Claremont Graduate University, and an M.Litt. in terrorism studies from the University of Saint Andrews, Scotland. She is co-editor of Global Criminal and Sovereign Free Economies and the Demise of the Western Democracies: Dark Renaissance (Routledge, 2015) and has published many other referred and professional works.

Dr. Robert J. Bunker is an Adjunct Research Professor, Strategic Studies Institute, US Army War College and Adjunct Faculty, Division of Politics and Economics, Claremont Graduate University. He holds university degrees in political science, government, social science, anthropology-geography, behavioral science, and history and has undertaken hundreds of hours of counterterrorism training. Past professional associations include Distinguished Visiting Professor and Minerva Chair at the Strategic Studies Institute, U.S. Army War College; Futurist in Residence, Training and Development Division, Behavioral Science Unit, Federal Bureau of Investigation Academy, Quantico, VA; Staff Member (Consultant), Counter-OPFOR Program, National Law Enforcement and Corrections Technology Center-West; and Adjunct Faculty, National Security Studies M.A. Program and Political Science Department, California State University, San Bernardino, CA. Dr. Bunker has hundreds of publications including Studies in Gangs and Cartels, with John Sullivan (Routledge, 2013),  Red Teams and Counterterrorism Training, with Stephen Sloan (University of Oklahoma, 2011), and edited works, including Global Criminal and Sovereign Free Economies and the Demise of the Western Democracies: Dark Renaissance (Routledge, 2014), co-edited with Pamela Ligouri Bunker; Criminal Insurgencies in Mexico and the Americas: The Gangs and Cartels Wage War (Routledge, 2012); Narcos Over the Border: Gangs, Cartels and Mercenaries (Routledge, 2011); Criminal-States and Criminal-Soldiers (Routledge, 2008); Networks, Terrorism and Global Insurgency (Routledge, 2005); and Non-State Threats and Future Wars (Routledge, 2002).

Comments

Bill C.

Fri, 01/25/2019 - 11:11am

So:  What is the strategy of the global elite re: these such matters?  The following excerpt, from a current Foreign Affairs article, entitled "Davos Has Learned to Fake Populism," may give us a clue:

BEGIN QUOTE

You don’t have to believe Klaus Schwab is a deep thinker to believe he is an important one. The founder of the World Economic Forum—the annual meeting of business leaders and politicians in Davos, Switzerland, that’s been convening this week—has always naturally articulated the views of the world’s economic elites.

So when Schwab publicly throws globalism under the bus, sounding like a leftist university professor while he’s at it, it’s worth paying attention. In the run-up to the 2019 World Economic Forum, Schwab wrote an article in which he declared that “Globalism is an ideology that prioritizes the neoliberal global order over national interests.”

Schwab, like the broader Davos set, is trying to adjust to the age of populism. But that’s not to suggest they’re surrendering to it. Quite the opposite: Schwab’s anti-globalist shift is a hijacking attempt. It shows how corporate elites are trying to accommodate nationalist populism while still maximizing their own personal gains—which, of course, come at the expense of the very masses they’re attempting to appeal to.

Schwab’s attack on globalism is aided by the ambiguity that has always surrounded the term. The convention, especially among right-wing populists, has been to portray “globalism” as the root of all evil, often with a certain anti-Semitic tinge to the accusation. The underlying suggestion is that globalism is a form of commercial world conspiracy, conducted by Goldman Sachs, George Soros, a series of U.S. Federal Reserve chiefs, and the like. In other ideological camps, globalism is considered a cover for the corporatist pursuit of neoliberal economic policies.

Schwab doesn’t adopt either of those definitions. Instead, Schwab differentiates between the “ideology” of globalism and the “phenomenon” of globalization. Globalization, he says, is a structural process involving the gradual dissolution of boundaries that is driven by technology and the movement of ideas, people, and goods.

In a sense, Schwab interprets these processes as ideology-neutral. And this framing does indeed make sense: Like it or not, and no matter what your political view is, globalization is a fact of life, just as climate change and pandemics are. None can be definitively stopped at a country’s border, even a country with a massive border wall.

The key issues that globalization in its ideology-neutral rendering does not address are the underlying or resulting inequities and other challenges stemming from the process of global integration itself. And this is exactly where “globalism” comes in. It aims at answering crucial questions such as: Will we address the downside effects of globalization within the confines of our own countries and societies? Are we to solve these issues nation-state by nation-state? Or unilaterally, as U.S. President Donald Trump believes?

Every government is free to try to pursue the answers it judges best, although there is plenty of evidence to suggest that going a purely unilateralist and national route is doomed to fail. Nationalism flattens out complexity, portraying complex issues in a simplifying, binary, and zero-sum way.

But populist politicians like Trump, even if they are ignorant, appear to have the virtue of consistency, in that they tend to rail against globalism and globalization at the same time. Schwab is more nuanced, but also more cynical in his approach. In separating international exchange from global governance—and only attacking the latter—he is encouraging a world in which politics is reduced to playacting action while economic elites remain unconstrained in their pursuit of profit. Schwab’s rhetoric might make his Davos confab more palatable to Trump-style populists. But it does not do anything to solve the real problems that fuel political discontent. ...

END QUOTE 

https://foreignpolicy.com/2019/01/24/davos-has-learned-to-fake-populism/

Bottom Line Thought -- Based on the Above:

"Fool me once ... "?