The growth in economic inequality and wealth concentration in America has become an ever more incontrovertible fact. Thanks in substantial measure to Occupy Wall Street, wealth distribution has made its long overdue entry into the mainstream of American political discourse. In response, Republicans in general and Mitt Romney in particular have fallen back on a single, simple “insight” to explain the traction of wealth distribution as a galvanizing political issue: envy.
In a recent interview, NBC’s Matt Lauer asked Romney whether “anyone who questions the policies and practices of Wall Street and financial institutions, anyone who has questions about the distribution of wealth and power in this country is envious? Is it about jealousy or fairness?”
Romney had a chance to acknowledge that it was some of both, before settling into his standard line about the president stoking the politics of divisiveness. Instead, he argued that “it was about envy,” full stop. When Lauer pressed him, asking whether questions about the distribution of wealth could be legitimate, Romneyno doubt believing he was responding magnanimouslyfinally demurred and said, “I think it’s fine to talk about those things in quiet rooms …” The exchange was an extraordinary one, a perfect storm of Romney’s unexamined entitlement and a party that is desperate to ascribe base moral motives to its opponents to cover its own utterly denuded moral vision.
As only one indicator of the extraordinary state of wealth concentration, by credible estimates the 400 richest Americans possess more wealth than the 155 million or so Americans who comprise the bottom half of wealth distribution in the United States. Tax rates on capital gains, estates and high incomes are dramatically lower than they were a generation ago. But today’s GOPafter decades of wealth concentration, median incomes that have flat-lined since 2000, chronic unemployment and growing insecurity for ordinary Americansisn’t content with the status quo.
Every major GOP figure, including Romney, insists on doubling down by pushing for policies that further benefit the already wealthy, regardless of the consequences for the vast majority of Americans. Three common threads run through the typical GOP budgetary proposal nowadays, including Romney’s: dramatically reduced taxes on the very rich and their estates; an increase, dramatic in some cases, in our long-term deficits; and, in an especially charming wrinkle, the possibility of increased taxes for large swaths of ordinary Americans.
It’s not new that Republican leaders who are themselves the sons of privilege have whined about “class warfare” to defend policies that themselves represent a clear form of class warfare. The elder Bush, for example, regularly invoked the charge during the 1992 presidential campaign and condescendingly warned that when “they aim for the big guy, they usually end up hitting the little guy.” But the degree to which today’s GOP has embraced tax cuts for the wealthy über alles is breathtaking. And Romney’s insistence on that monomaniacal policy goal reflects both his hermetically sealed privilege and his mindless embrace of Republican doctrine.
That sense of privilege is so deeply ingrained that, sometimes, Romney just can’t help himself. Last week, when letting out dribs and drabs of information about his income (he’s holding off releasing his federal tax returns), the former Massachusetts governor acknowledged that he paid a tax rate “probably closer to the 15 percent rate than anything,” because most of his income derived from investments, taxed at the lower capital gains rate. This means that, despite being a very wealthy man with an estimated net worth perhaps as high as $250 million, Romney’s effective federal tax rate is lower than that of many middle-class Americans. Romney and his supporters insist that this is justifiedattempts by his minions to defend the 15 percent rate as “legal” are entirely pointless, since no one is disputing that factbecause investment is particularly risky and should be “rewarded.”
But as Paul Krugman has argued, any kind of small business involves a lot of risk and effort for “an uncertain return.” Last fall, a controversy erupted when billionaire Warren Buffett noted that heand other exceptionally wealthy Americans who derive the bulk of their income from non-labor sources, i.e. investment incomepays a lower actual federal tax rate than his secretary and that this was fundamentally unfair, the result of increasingly distorted tax policies that needed to be corrected. According to Romney and standard Republican dogma, there could be one and only one reason why Buffett would raise this issue in public: jealousy. Readers can decide for themselves what, exactly, Buffett is so envious of.
In the same debate during which Romney acknowledged his relatively low federal tax rate, he also said that he made speaker’s fees “from time to time,” which he characterized as “not very much.” According to financial disclosures, what Romney means by “not very much” came to a little over $374,000 for the year ending in February 2011. That figure would, all by itself, essentially place Romney’s income in the top 1 percent of all American households.
Leaving aside fairness issues, well-respected economists believe that, in order to optimize economic growth, top tax rates could and should be much closer to where they were in 1980 than where they are now, let alone the still lower levels that Romney and the GOP insist upon. And in fact, higher income tax rates have generally coincided with the most robust periods of growth we’ve had since the end of World War II. But nevermind all that, because it’s become unthinkable in standard GOP doctrine that there could be any legitimate public good in suggesting that the very wealthy should pay more in taxes.
Empirical reality aside, what’s lurking underneath Romney’s defensive claims about “envy” (Is he really going to try to make this a central argument of his campaign?) is indignation: a sense of outrage that anybody could question the nature and sources of his privilege. In Romney’s world, he and people like him are as fabulously wealthy as they are because they are special. If you have a problem with that, it’s because there’s something wrong with youmorally wrong, in factbecause what else could explain such indulgence in the sin of envy?
If you can’t see the well-coiffed world that Romney sees through his rose-tinted glasses, the least you can do is keep it to yourself. Like Richie Rich, Mitt Romney is the poor little rich boy, unfairly maligned merely because he’s better than you are.