Sunday Excerpt: The Hidden History of American Oligarchy

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The Hidden History of American Oligarchy

The Supreme Court Sets Up American Oligarchy

If you were looking for a date when our modern American oligarchy started, it would be January 30, 1976. It was a clear day in Washington, DC, the temperature well above freezing with a light wind.

When the Supreme Court handed down their decision in the case of Buckley v. Valeo, the New York Times noted in a front page article, “Campaign finance law in New York, New Jersey, Connecticut and 32 other states will require drastic revision in the wake of yesterday's Supreme Court decision that struck down nearly all limits on campaign spending by candidates for Federal office.”[i]

It was the first of a cascade of decisions that reached their peak in 2010 with Citizens United v. FEC.

From 1789, when the Constitution was ratified and we officially became a republic, until 1976, when the Supreme Court decided to strike down thousands of state and federal laws put in place over a century or more to hold back oligarchy, the federal government had never before interfered in the right of states to regulate money in their elections. In 1907, in fact, the federal government itself had made it a felony for any corporation to give money to candidates for federal office with the Tillman Act.

Buckley struck down most of those laws in 1976, despite the objections of Justice Byron White, who said that money in politics posed “a mortal danger against which effective preventive and curative steps must be taken.”

Two years later, in a decision authored in part by Lewis Powell, the justices extended the “you may spend whatever you want to influence elections” logic to corporations, citing the 1886 Santa Clara headnote in their First National Bank of Boston v. Bellotti decision.

Prior to Buckley, candidates for office had a huge incentive to do at least the bare minimum necessary to meet the needs of their voters; elections turned on performance as much as ideology. But by Reagan’s 1980 election, all that was necessary was that candidates and incumbents say they were doing what voters wanted, because big donors and campaigns themselves could simply amplify the candidates’ words ad infinitum via purchased media.

Politics turned from “the art of the possible” to “the art of the con,” at least for those politicians and parties willing to sell themselves to the highest bidder. Probably the best examples of this were Reagan’s twin assertions that ridding workers of the right to unionize would lead to better wages and benefits, and that if taxes on the very wealthy and big corporations were radically reduced, it would make working class people wealthier.

Both were demonstrable lies, with centuries of evidence proving them false. George H. W. Bush, in the 1980 Republican primary, even called Reagan’s claims “voodoo economics,” saying, “It just isn’t gonna work,” although after Reagan picked him as VP, he was reduced to stammering on national TV that he’d never said such a thing.[ii]

Union leaders, meanwhile, warned their workers that once the unions were reduced in power, wages would begin to fall and Republican “free trade” agreements would ship millions of unionized jobs overseas. Nixon had opened the door to China, and the G. H. W. Bush administration negotiated the NAFTA deal with Mexico. Think tanks getting massive infusions from the scions of banking and oil fortunes poured out the propaganda, though, and it took 30 years or more before most working-class Americans figured out that they’d been screwed back in 1981.

In 1992, Bill Clinton assured Americans that deregulating banks would make people’s savings safer, that gutting the social safety net and “ending welfare as we know it” would benefit poor people in depressed parts of the country, and that NAFTA would open the door to millions of new tech jobs to replace all those dirty factory jobs that would go to Mexico and, later, to China.

By 2008, voters were starting to get wise to the game and rejected Senator John McCain’s argument that more tax cuts and fewer unions would revive the economy; voters went instead for “hope and change.” After Barack Obama took office, he had only 74 working days during his entire presidency with a filibuster-proof Senate through which he could pass legislation.

Nonetheless, he got through the Affordable Care Act and dozens of less notable but important pieces of legislation, particularly the creation of the Consumer Financial Protection Bureau, which, to date, has recovered over $12 billion stolen from average Americans by big banks.[iii]

Donald Trump, riding a long-shot candidacy, apparently got the memo. He’d been a Democrat his entire life, because that party largely controlled New York. As such, he knew that most Americans were sick of the trade deals that were sending jobs overseas, and that some of the loss of unionized factory and construction jobs could be blamed as much on brown-skinned people coming illegally from south of the border as on China.

Combining the two topics, along with a good dose of white supremacist rhetoric to reach out to Reagan’s original coalition, and throwing a bone to the religious right that he’d protect their tax-exempt status even if they broke the law (which he vowed to change) by politicking from the pulpit, he picked up enough votes in Midwestern states ravaged by NAFTA to help him beat Hillary Clinton, whose husband had signed that despised trade deal.[iv]

The argument for oligarchic control is the same argument that’s been made by conservatives throughout history, from Thomas Hobbes to Sir Edmund Burke to Warren Harding and Donald Trump:

With us in charge, we will keep you safe and happy, and you really don’t need to concern yourself with the complicated work of governance. You don’t want to tear down or shake up the system: having very wealthy people control the government has always led to the greatest level of stability and peace—look how stable Europe was for a thousand years when royal families and their landed gentry ruled. We’re the ones chosen by God or a brilliant DNA lineage to lead. Just go shopping and leave things to us.

This led us from the oligarch-friendly President Reagan to the conversion, in 1992, of the Democratic Party via the Democratic Leadership Council to become oligarch friendly itself (a legacy it’s today struggling to undo). In 2016, such oligarchs as Robert Mercer and Charles Koch finally, directly and indirectly, put an oligarch, Donald Trump, in the White House.

“Starve the Beast” and Gut the Republic

One of the most successful ways in which the oligarchs, using their think tanks and media, have convinced Americans that government is bad and government functions should be privatized and run by oligarchs is through a strategy that the Reagan administration first articulated and was described in the Wall Street Journal in 1985.[v] It was called “starve the beast,” and essentially it follows a simple three-step process.

First, Republicans promote the idea that taxes are too high and are strangling the ability of rich people and their companies to stimulate the economy, which, they say, would raise every working person’s pay and benefits. On this promise, they pass massive corporate, individual, and capital gains tax cuts.

Second, they point out that there’s now a huge deficit (because of the tax cut) and declare that it’s vital to “cut waste, fraud, and abuse” out of the system—and so they cut staffing to agencies like the EPA, IRS, and Social Security Administration.