Article 14-Limiting Idle Wealth
Monday, January 4, 2016
A Proposed New Constitution Article 14, Limiting Idle Wealth
Article 14-Limiting Idle Wealth
“1. Large concentrations of idle wealth are inherently dangerous and inhumane. All income from any and all sources greater than 100 times the median national income and all wealth of an individual greater than 100 times the median national wealth shall be seized, unless it is reinvested or donated to charity.”
Wealth is power and any accumulation of power is dangerous and undemocratic. But the strongest critique of inequality is one that US conservatives should heed because it speaks directly to the deepest beliefs of the great majority of them:
It is un-Christian.
Inequality and concentrations of wealth are against every Biblical principal, the expressed word of Christ, and for that matter, against the central precepts of most major world religions, and most minor ones too. Christ raged against money changers in the temple. He intoned that it was easier for a camel to be threaded through the eye of a needle than for a rich man to enter Heaven. For two millenia, the church has maintained the idea of Holy Poverty, that the poor are especially close to God, that the church should be especially concerned with their fate, that we are all our brother's keeper, and that materialism and attachment to possessions are unhealthy spiritually. After all, Jesus lived an ascetic life, one concerned with the fate of “the least of my brothers,” not a life devoted in any way to financial profit or accumulating wealth.
Much of modern conservatism ignores these central messages of Christianity, instead being far more concerned with what people do with their genitals. To paraphrase George Orwell, they are only Christians from the waist down. Another portion of conservatism is devoted to putting personal profit over the public good. Bizarrely, some libertarians and conservatives admire Ayn Rand, whose philosophy inspired no less than the Satanic Church. America as a nation could gain much by returning to that original Christian message.
Wealth being power, it is also dangerous unless limited, far more inefficient than its admirers admit, and destructive to a nation and society to let it gather and remain idle. In Latin America, there were wars and revolutions fought for nearly two centuries over latifundias, huge estates larger than most US counties, kept idle while much of the public had no land at all, solely because the size of the estate brought prestige to its owner.
But US elites have long been even more conspicuous in their obscene displays. The public saw William Randolph Hearst buy entire castles in Europe to be reassembled in California. The Astors held a multimillion dollar party at the height of the Great Depression. Elvis would charter a jet just to get peanut butter and jelly sandwiches. Aaron Spelling lived in a mansion covering over 6 acres, with rooms devoted just to wrapping presents. Michael Jackson had his own private zoo and amusement park with roller coasters and carousels. Numerous CEOs insist on private jets that cost millions to buy and maintain, while downsizing their companies and keeping employee wages low. Nike CEO Phil Knight became an international symbol of inequality at its most odious, accumulating over $24 billion while paying his Indonesian workers 14 cents an hour in unsafe sweatshop conditions. (It took over a decade of protests and boycotts to bring partial reforms to Nike.)
Such examples are part of a larger pattern. American elites have far more wealth and pay compared to their workers, more than anywhere else in the world. There is far more inequality in the US than in almost all other developed nations. Only Russia and Slovakia are more unequal. A Japanese CEO makes slightly less than 70 times what one of their workers do. In the US, a CEO makes over 350 times an average worker's pay. Such inequality even horrifies noted conservatives like commentator George Will, who once said American CEOs are doing what Karl Marx was unable to do, discredit capitalism.
Such concentrations of power must be ended for the damage they do to society and democracy. It is hardly a secret that money buys elections, and elites purchase favorable laws written for them by a congress dependent on their support. Barring the use of elite funds in elections is not enough, for there is no practical way to end lobbying without limiting or ending the right to petition. Remove the excess wealth, any wealth that is not devoted to investment or charity. That way elites will not have funds not only for a lifestyle that holds the middle and working classes in contempt, but to influence public sentiment any more than any other person.
The standard used for this proposal is very generous. A full 100 times the median annual income of slightly under $27,000 is currently a little under $2.7 million. 100 times the current median wealth of slightly over $81,000 is slightly over $8.1 million. If any elites or their apologists complain this is too harsh, let them try to convince a waitress or bus driver that elites “need” more than $2.7 million a year to live on, or “need” a home worth over $8 million.
There is absolutely no way that a CEO is worth 350 times more than an average worker. It defies logic and basic morality. If anything, the pattern is the opposite: Having more wealth makes one less capable, not more. For the cushion of wealth makes one soft, out of touch with the world and the people within it. It is also morally numbing. As one study pointed out, the obscenely wealthy have far less empathy for the average worker, the greater the wealth they have.
The effect of penalizing idle wealth will not be to “punish success.” Most wealth is either inherited or created by a combination of luck and favorable government laws. Penalizing idle wealth spurs investment and charitable donations. In Europe, the ideal of noblesse oblige says that nobility must give one sixth of their income to charity. In Muslim tradition, alms for the poor is one of the central pillars of the faith, requiring the giving away of up to a tenth of not just your income, but all your wealth.
But American elites as a group are not very generous. As income in America goes up, the proportion given to charity generally goes down. Phil Knight, for example, had as his sole “charity” to have a sports stadium and business school built at his old university named after him. Let this proposal become the American version of noblesse oblige, an obligation for elites to do good instead of self-aggrandizement, more power, and ever increasing unequal wealth.
“2. All attempts to conceal wealth to avoid taxes shall result in prosecution as grand larceny, full seizure of not just concealed wealth but all wealth, and long prison sentences which may not be suspended. Separate white collar prisons, or other prisons that are less arduous or harsh, are forbidden, and all white collar criminals must be punished and imprisoned with all other prisoners.”
More than $21 trillion in concealed wealth is hidden overseas, about one and a half the value of the entire US economy. And that's the low estimate. The highest is $31 trillion. American wealth is roughly one tenth of that, $2.1 trillion.
Over $2 trillion in untaxed wealth is a theft and crime that Pablo Escobar could only dream about. Most hidden wealth is not from criminals, but from “respectable” sources. Nearly three fourths of the Fortune 500 top corporations routinely hide huge amounts. Apple alone hides over $180 billion. American corporate criminals, were they to pay up, owe the nation up to $620 billion. That loss weakens the nation and society, treats with contempt the average honest person and the system we all live under. The wealthiest in America clearly show they have always been the least patriotic of people.
Such concealed wealth should be immediately declared by elites and taxed, so that they may avoid having it all seized and then having to serve a lengthy prison sentence. If they fail to, then the entire $2.1 trillion should be seized outright, and elites hunted down wherever on the globe they hide out, and then imprisoned. Al Capone was sentenced to 11 years in federal prison, serving much of that time in Alcatraz, for evading income tax on perhaps $100 million. There is no just reason similar elite criminals cannot serve similar sentences for concealing similar amounts, and do equally similar hard time. Elite thieves should be tracked down by the likes of the US Marshals, no different than other criminals.
Treating wealthy elites differently from other criminals once they are imprisoned also must be ended. Some current white collar prisons have wooded parks in them. Prisoners get routine net access and email. Most get generous visits from family, with prisoners getting to choose a prison close to their family. Some white collar “prisons” allow prisoners to spend their days outside the facility. One in Pensacola even allows prisoners to go to a local movie theater.
This is obviously unjust. Let the fear of hard conditions, including the fear of other prisoners, become one more deterrent designed to make wealthy elite criminals honest. Let us stop the practice of being soft on crime when it is being done by those in $20,000 suits. Wall Street criminals should face justice no differently than those on Main Street.