Billionaires and American Politics

Is the United States becoming a plutocracy?

With the manifestly unqualified but immensely rich Donald Trump serving as the nation’s first billionaire president, it’s not hard to draw that conclusion.  And there are numerous other signs, as well, that great wealth has become a central factor in American politics.

Although big money has always played an important role in U.S. political campaigns, its influence has been growing over the past decade.  According to the Center for Responsive Politics, by 2014 the share of political donations by the wealthiest 0.01 percent of Americans had increased to 29 percent (from 21 percent four years before), while the top 100 individual donors accounted for 39 percent of the nation’s super PAC contributions.

With the 2016 presidential primaries looming, would-be Republican nominees flocked to Las Vegas to court billionaire casino magnate Sheldon Adelson and his wife, who had donated well over $100 million to Republican groups during the 2012 election cycle.  Although even Adelson’s money couldn’t save them from succumbing to vicious attacks by Trump, Adelson quickly forged a close alliance with the billionaire president.  In 2018, he became the top political moneyman in the nation, supplying Republicans with a record $113 million.

In fact, with Adelson and other billionaires bringing U.S. campaign spending to $5.2 billion in that year’s midterm elections, the big-ticket players grew increasingly dominant in American politics.  “We like to think of our democracy as being one person, one vote,” noted a top official at the Brennan Center for Justice.  “But just being rich and being able to write million-dollar checks gets you influence over elected officials that’s far greater than the average person.”

This influence has been facilitated, in recent years, by the rise of enormous fortunes.  According to Forbes―a publication that pays adoring attention to people of great wealth―by March 2019 the United States had a record 607 billionaires, including 14 of the 20 wealthiest people in the world.  In the fall of 2017, the Institute for Policy Studies estimated that the three richest among them (Jeff Bezos, Bill Gates, and Warren Buffett) possessed more wealth ($248.5 billion) than half the American population combined.

After this dramatic example of economic inequality surfaced in June 2019, during the second Democratic debate, the fact-checkers at the New York Times reported that the wealth gap “has likely increased.”  That certainly appears to be the case.  According to Forbes, these three individuals now possess $350.5 billion in wealth―a $102 billion (41 percent) increase in less than two years.

The same pattern characterizes the wealth of families.  As Chuck Collins of the Institute for Policy Studies recently revealed, Charles and David Koch of Koch Industries (their fossil fuel empire), the Mars candy family, and the Waltons of Walmart now possess a combined fortune of $348.7 billion―an increase in their wealth, since 1982, of nearly 6,000 percent.  During the same period, the median household wealth in the United States declined by 3 percent.

Not surprisingly, when billionaires have deployed their vast new wealth in American politics, it has usually been to serve their own interests.

Many, indeed, have been nakedly self-interested, sparing no expense to transform the Republican Party into a consistent servant of the wealthy and to turn the nation sharply rightward.  The Koch brothers and their affluent network poured hundreds of millions (and perhaps billions) of dollars into organizations and election campaigns promoting tax cuts for the rich, deregulation of corporations, climate change denial, the scrapping of Medicare and Social Security, and the undercutting of labor unions, while assailing proposals for accessible healthcare and other social services.  And they have had substantial success.

Similarly, billionaire hedge fund manager Robert Mercer and his daughter, Rebekah, spent $49 million on rightwing political ventures in 2016, including funding Steve Bannon, Breitbart News, and Cambridge Analytica (the data firm that improperly harvested data on Facebook users to help Trump’s campaign).  After Trump’s victory, Robert stayed carefully out of sight, sailing the world on his luxurious, high-tech super yacht or hidden on his Long Island estate.  But Rebekah worked on the Trump transition team and formed an outside group, Making America Great, to mobilize public support for the new president’s policies.

The story of the Walton family, the nation’s wealthiest, is more complex.  For years, while it fiercely opposed union organizing drives and wage raises for its poorly-paid workers, it routinely channeled most of its millions of dollars in campaign contributions to Republicans.  In the 2016 elections, it took a more balanced approach, but that might have occurred because Hillary Clinton, a former Walmart director and defender of that company’s monopolistic and labor practices, was the Democratic standard-bearer.

Although some billionaires do contribute to Democrats, they gravitate toward the “moderate” types rather than toward those with a more progressive agenda.  In January 2019, an article in Politico reported that a panic had broken out on Wall Street over the possibility that the 2020 Democratic presidential nominee might go to someone on the party’s leftwing.  “It can’t be Warren and it can’t be Sanders,” insisted the CEO of a giant bank.  More recently, billionaire hedge fund manager Leon Cooperman made the same point, publicly assailing the two Democrats for their calls to raise taxes on the wealthy.  “Taxes are high enough,” he declared.  “We have the best economy in the world.  Capitalism works.”

The political preferences of the super-wealthy were also apparent in early 2019, when Howard Schultz, the multibillionaire former CEO of Starbucks, declared that, if the Democrats nominated a progressive candidate, he would consider a third party race.  After Schultz denounced Warren’s tax plan as “ridiculous,” Warren responded that “what’s `ridiculous’ is billionaires who think they can buy the presidency to keep the system rigged for themselves.”

Can they buy it?  The 2020 election might give us an answer to that question.

Lawrence Wittner (https://www.lawrenceswittner.com/ ) is Professor of History Emeritus at SUNY/Albany and the author of Confronting the Bomb (Stanford University Press).