Upper Crust: How Billionaires Are Eating Our Democracy

Darrell West warns that the combination of wealth and secrecy is toxic to democracy…

EduShyster: Your book, Billionaires: Reflections on the Upper Crust, makes the forceful – and might I add *hair-raising* – case that today’s brand of billionaire activism is eating our democracy. Break it down for us.


Darrell West: I do think that combination is toxic for democracy because voters care as much about the messenger as the message and they want to know who is behind particular advocacy efforts. It matters to them whether an oil company or some other firm is pushing a position on energy. There’s been a tremendous loss of accountability within our political system over several decades. There are Supreme Court decisions that have eroded public disclosure, and there are lots of lobbying activities and other efforts to exercise influence that take place outside of the public view. People should be aware of this and concerned about how it’s affecting our political process.

670px-Taste-Single-Malt-Scotch-Step-3EduShyster: But a lot of these billionaires seem like such great guys – the kind of guys you’d want to have a billion-dollar beer with, or perhaps a single-malt scotch. Take hedge funders Daniel Loeb and Paul Singer, for example, who, in between hedge funding and fund raising for charter schools, are leading a global crusade for gay rights.

West: I argue that people shouldn’t judge billionaire activism based on whether they agree with the agenda. There are many billionaires doing things that I might personally approve of, but we still need to be concerned about their overall political influence and accountability in the system. A lot of these individuals are pursing lobbying and advocacy efforts in secret. Even if you happen to agree with what they’re doing on a particular cause, there are systemic concerns people should have.

EduShyster: You argue that this element of secrecy, that’s so dangerous to democracy, has been abetted by the collapse of journalism, especially at the state and local level. Explain.

West: A lot of newspapers were completely wiped out by the financial crisis. Then you have the death of the traditional newspaper business model as a result of the Internet. All of this has meant a decline in press coverage at the state and local level which is where much of the spending and behind-the-scenes lobbying by billionaire activists takes place. We’re also seeing a lot of American billionaires buying up media outlets. You have Jeff Bezos who purchased the Washington Post, Michael Bloomberg bought Business Week, Rupert Murdoch has the Wall Street Journal and Fox News. When you look at other countries, that’s exactly what you see happening. The ultra rich buy up the channels of communication and that doesn’t usually end very well.

Billionaires (1)EduShyster: You use your book to sound some serious alarms about where we’re headed if current trends persist, including deep income inequality, extreme wealth concentration and a lack of transparency. You say *America has more to fear than people realize.* Scare me more please.

West: There are a lot of bad trends that have come together in this particular time period. The concentration of wealth, the secret advocacy efforts that are taking place, the loss of accountability through news organizations. If you have all of those things occurring simultaneously, that’s a very bad movie for the average person. The middle class feels squeezed on a lot of different fronts and they don’t see government doing. But things could get a lot worse if people aren’t careful.

There are a lot of bad trends that have come together in this particular time period. The concentration of wealth, the secret advocacy efforts that are taking place, the loss of accountability through news organizations. If you have all of those things occurring simultaneously, that’s a very bad movie for the average person.

EduShyster: Obama raised some of these issues in his 2015 State of the Union address. In fact he even used the *b* word a couple of times. Did you hear anything in his speech that encouraged you that he’s going to steer us off of our current path towards oligarchy?

West: Obama understands that wealth concentration is linked to the loss of economic opportunity in the middle class. If billionaires keep government small and tax rates low, it makes it difficult to fund healthcare and opportunities to go to college. And if they use dark money to distort elections, that makes it impossible for voters to hold politicians accountable. Wealth is part of the gridlock and paralysis that grips Congress and keeps legislators from addressing important policy problems. 

cigarEduShyster: I hear some conservatives arguing that income inequality in itself isn’t the problem – and that it really wouldn’t be such a big deal that, say, the Koch brothers have so much, if everyone else had just a little more. I find this view nonsensical. What say you?

West: A lot of people believe that income inequality and mobility are unrelated, but there’s an important connection, and you can see it in the political process. People with money are much more conservative than the average American on a range of issues related to social opportunity, education and health care. They’re much more likely to favor cuts and benefits in programs that benefit the less fortunate. If billionaires were perfectly representative of us politically it wouldn’t be such a threat, but they have very particular view points and they’re not the same views that the average American has.

EduShyster: If you had a magic wand you could wave to combat what you call *wealthification* and its insidious effects, what would you fix?

West: I’d improve transparency. I do think that if people had more information both about the message and the messenger they would be in a position to make more informed choices. On the economic side we really do have to think about wealth concentration. What drives the political advocacy is the extraordinary amount of money that some individuals have. I love to give the example of the Koch brothers because between the two of them they have about $84 billion in assets. In the 2014 election they spent about $290 million dollars, which is an incredible amount of money—but a drop in the bucket when you have $84 billion. Somehow we have to get a handle on this very high degree of wealth concentration that is creating structural inequity that’s so problematic.

butlerEduShyster: A number of the billionaire activists you chronicle have a particular passion for *fixing* the nation’s failed and failing schools. What do you think is behind this?

West: One of the interesting things is that two thirds of American billionaires are self made. A lot of them owe their professional success to having gotten great educations. Now that they’re thinking about their impact on the world, a number of them are very focused on education because they recognize how crucial their own educations were. But the thing to watch is that a number of them have very particularly perspectives on how to improve schools –  and a lot of their ideas are very controversial. They’re always talking about the need to disrupt the status quo and transform the system but people have to look at the details to see what they’re actually proposing. Ideas that might seem good on the surface can change things in a very dramatic way.

Darrell West is the Vice President and Director of Governance Studies at the Brookings Institute and the author of Billionaires: Reflections on the Upper Crust. Send tips and comments to tips@haveyouheardblog.com.

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