If Greed is Good, Then I Don’t Know What Good Is.

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Greed is good. The concept was largely brought about back in 1957 by Ayn Rand in her now famous novel, Atlas Shrugged. Although not always formally admitted, it is still a fundamental ideology within the Republican Party and more so within the Tea Party. Those who want more work harder and thus deserve more. Said that way, it is a statement many may and do agree with. This is because it taps into one of the basic concepts of capitalism, that individuals, not the government, control the market and consequently determine its and their fate. This, as Ayn points out, is the embodiment of justice in economics and life.

“The moral justification of capitalism does not lie in the altruist claim that it represents the best way to achieve ‘the common good.’ It is true that capitalism does—if that catch-phrase has any meaning—but this is merely a secondary consequence. The moral justification of capitalism lies in the fact that it is the only system consonant with man’s rational nature, that it protects man’s survival qua man, and that its ruling principle is: justice.” — AYN RAND

Justice though, as defined by the merriam-webster dictionary, describes fairness, impartialness, and conformity to truth, fact, or reason. It is said to be synonymous with equity, fairness in the way people are treated, specifically with freedom from bias or favoritism. So yes, maybe it is fair that people who work harder earn more. I find it difficult to argue with that statement. However, this begs the questions, how much more? How do you describe who is working harder?  Is it not intrinsic to justice that these questions be answered with a lack of bias, from an impartial viewpoint? Doesn’t justice preclude that that freedom and fairness stem from an even playing field, void of favoritism?

Today, the 400 wealthiest Americans have more wealth than the bottom 50% of Americans, approximately 158 million people. The top 1% of Americans own about 35% of the wealth in America. The top 10% own approximately 75% of the wealth. To rephrase, this meansthat 90% of Americans collectively own 25% of our nation’s wealth. These are numbers we have all heard, but what exactly do they mean? For starters let’s think about how we can compare your “average” American to someone in the top 1%. It is tempting to look at the average net worth of American’s, $301,000, but this figure is surprisingly deceiving. If we were to look at a small group of 5 people whose wealth are measured in arbitrary units as 5, 4, 7, 946, and 1, we would say the average wealth of that group is 192. This is nearly 30 times the wealth of the second wealthiest person in that group, so it hardly seems fitting to say your typical person in the group has that amount of wealth. A perhaps more appropriate approach is to look at the median, the middle value of all of the ordered values. In our 5 person group, the median value is 5. This too is an over simplification, but seems a better representation of what your typical person is worth. In the US, the median net worth is $45,000, less than a sixth of the average net worth. Like in our sample group, this is because we have a highly skewed distribution of wealth. So how much more wealthy is the top 1% than your typical American? Approximately 70 times wealthier than the average and about 190 times wealthier than the median.

So, one could ask, do these people work 70 to 190 times harder than your typical American? It is quite doubtful. These numbers describe only greed, not justice. And worse, it is only a fallacy that given hard work, anyone can become part of that 1%. From the very beginning of life in the United States, there is extreme bias and favoritism. There is no such thing as an even playing field. While many young American’s are working hard 10+ hour days just to earn enough to put food on the table, others are attending college, travelling the world gaining valuable resume building experience, and getting internships using their valuable connections. These opportunities hardly ever present themselves to the working poor. An unpaid internship for many would mean their families would go hungry. There is no inherent difference in intelligence or motivation between people born into wealth and people born into poverty and it is no coincidence that people born into wealth stay wealthy and people born into poverty stay poor. The social mobility in the United States, that opportunity people have to change classes, is as low as wealth differential is high. There is a reason for this. It is an illusion that in our democracy the power is held by the people. The much less inspiring story is that Money=Power. In 2014, over $950 million was spent for campaigns for the house and over $550 million in the senate. The magnitude of these numbers is both shocking and horrifying. Two things are true about this money: 1. Only the wealthiest Americans can afford to make notable contributions and 2. There is a reason they are handing over millions of dollars. The average politician in the house or senate must raise approximately $10,000 per week to fund their next campaign. This is to say nothing of the money exchanged between lobbyists and political groups. Politicians with any political power are thus funded and controlled by big money. And, as we discovered earlier, big money is gained by greed.Social_mobility_is_lower_in_more_unequal_countries

So now we have a nation not driven by liberty and justice but through a purposefully complicated and hidden economic system, a nation run by the richest and greediest people. It is therefore not surprising that the wealth distribution in America is becoming ever more skewed (check out this great site: http://scalar.usc.edu/works/growing-apart-a-political-history-of-american-inequality/index). A few millionaires and billionaires are seeking to increase their wealth and are doing so by designing a system that funnels money from the many poor to the few rich. They have the money, they have the power, and they are very very greedy. They hide their system behind ideas of justice and the American Dream and promote a lack of education in the poor who are required to help them amass their fortunes. Greed has become the defining sentiment in our economic system, leaving no room for compassion, kindness, sympathy, tolerance, and general humanity. If there is any question of this, remember that there are both billionaires and people looking for their meals in trash cans. But a small sliver of the top 1%’s wealth could eliminate hunger in America.

This post is largely motivated by the documentary “Park Avenue: Wealth, Power, and the American Dream.” I recommend checking it out. The first step towards change must be education of the masses.

Follow your bliss and have a great week.

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