America's political-economy is caught in a vicious cycle, with concentrated wealth at the top leading to outsized political power.
For a generation, America's political-economy has been gripped in a vicious cycle. Those at the top of the economic pile have taken an ever-growing share of the nation's income, and then leveraged that haul into ever-greater political power, which they have in turn used to rewrite the rules of “the market” in their favor. Wash, rinse and repeat.
It's the result of years of institutional investments by the corporate Right to advance a reactionary legal regime in America's courts. In the process, the richest Americans now have their hands in both our legislative and judicial branches, while working America has become a voiceless stepping stone.
“The more pernicious effect of economic inequality comes indirectly through its impact on political inequality,” says MIT economist Daron Acemoglu, co-author of Why Nations Fail. In an interview with Think Progress, Acemoglu explained what he called, “a general pattern throughout history”:
When economic inequality increases, the people who have become economically more powerful will often attempt to use that power in order to gain even more political power. And once they are able to monopolize political power, they will start using that for changing the rules in their favor.
This dynamic is best understood in the realm of electoral politics. In a study of something that most people already consider to be obvious, Larry Bartels, a political scientist at Princeton, examined lawmakers' responsiveness to the interests of various constituents by income, and concluded:
In almost every instance, senators appear to be considerably more responsive to the opinions of affluent constituents than to the opinions of middle-class constituents, while the opinions of constituents in the bottom third of the income distribution have no apparent statistical effect on their senators’ roll call votes (PDF).
Or consider ALEC, an organization funded by major corporations that writes laws that, among other things, curtail workers' rights to organize and disenfranchises the poor, elderly and people of color. It then lobbies state lawmakers to pass its “model legislation,” and sweetens the deal with junkets – all-expenses-paid vacations at posh hotels for legislators and their families – where they can rub shoulders with the titans of industry.
Look at the fruit that union-busting bears for the wealthiest Americans:
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Another way the wealthiest Americans have rigged the rules so more of the national income flows upward may be just as consequential, but less well understood. A 30-year campaign to push America's courts sharply to the right has borne abundant fruit for those in the top 1 percent.
We see it reflected in today's Supreme Court, which, having unleashed a flood of super-PAC cash into our political campaigns in a decision that was one of the most brazen examples of judicial activism in the court's history, now stands poised to overturn not only the Democrats' healthcare bill, but much of the jurisprudence that supported the welfare state developed since the New Deal.
A study by the Constitutional Accountability Center found that the Chamber of Commerce had won 65 percent of its cases heard by the court under Chief Justice John Roberts, compared to 56 percent under former Chief Justice William Rehnquist (1986-2005) and just 43 percent of the cases that came during the Burger court (1969-1986).
But that's only the beginning. “The Roberts Court,” wrote Slate's Dahlia Lithwick, is “slowly but surely... giving corporate America a handbook on how to engage in misconduct. In case after case, it seems big companies are being given the playbook on how to win even bigger the next time.”
Many of the court's rulings have overturned long-standing precedents. While conservatives constantly rail against judges "legislating from the bench," it is far more common for right-leaning jurists to engage in “judicial activism” than those of a liberal bent. That's what several studies have concluded. Media Matters offered a run-down of a couple of prominent ones:
A 2005 study by Yale University law professor Paul Gewirtz and Yale Law School graduate Chad Golder showed that among Supreme Court justices at that time, those most frequently labeled "conservative" were among the most frequent practitioners of at least one brand of judicial activism -- the tendency to strike down statutes passed by Congress. Those most frequently labeled "liberal" were the least likely to strike down statutes passed by Congress.
A 2007 study published by University of Chicago law professor Thomas J. Miles and Cass R. Sunstein... used a different measurement of judicial activism: the tendency of judges to strike down decisions by federal regulatory agencies. Sunstein and Miles found that by this definition, the Supreme Court's "conservative" justices were the most likely to engage in "judicial activism" while the "liberal" justices were most likely to exercise "judicial restraint."
In a recent opinion, two federal appeals court judges suggested that all efforts to protect workers, consumers or the environment were unconstitutional, including regulatory efforts by the states. It's a radical view, but one that has gotten increasing traction in conservative legal circles. It is also the culmination of years of institutional investments by the corporate Right to advance what's come to be known as the “law and economics” movement, which analyzes legal rulings “costs” – essentially applying neoliberal economic logic to the field. Its advocates eschew the notion that human rights or economic fairness are inherently valuable factors for the law to consider.
The model has gained increasing influence in American courts, and that's no accident. In his book, The Rise of the Conservative Legal Movement: The Battle for Control of the Law, Johns Hopkins scholar Steven Teles writes that conservatives, reacting to what they viewed as liberal hegemony in the legal community of the 1960s, fought hard to shift the legal terrain rightward.
Spurred by their overlapping grievances, informed by an increasingly sophisticated of how to produce legal change, and coordinated by strategically shrewd group of patrons, conservatives began investing in a broad range activities designed to reverse their … organizational weaknesses. While similar kinds of organizational development were happening in other domains … in no other area was the process of strategic investment as prolonged, ambitious, complicated and successful as in the law.
In 1998, the Washington Post reported that “Federal judges are attending expenses-paid, five-day seminars on property rights and the environment at resorts in Montana, sessions underwritten by conservative foundations that are also funding a wave of litigation on those issues in the federal courts.”
Funding for the seminars, run by a group called the Foundation for Research on Economics and the Environment (FREE), also comes from foundations run by companies with a significant interest in property rights and environmental law issues.
One of the group's funders was the John M. Olin Foundation, which invested millions of dollars in the law and economic movement – endowing university chairs, funding think-tanks and providing early support for the Federalist Society, which was founded in 1982 by former attorney general Ed Meese, controversial Supreme Court nominee Robert Bork and Ted Olsen—who years later would win the infamous Bush v. Gore case before the Supreme Court in 2000 and then go on to serve as Bush’s solicitor general. The foundation said in a 2003 report to its trustees, “All in all, the Federalist Society has been one of the best investments the foundation ever made.”
In 2005, the Olin Foundation actually declared “mission accomplished” and closed up shop. The New York Times reported that after “three decades financing the intellectual rise of the right,” the foundation’s services were no longer needed. The Times added that the loss of Olin wasn’t terribly troubling for the movement, because whereas “a generation ago just three or four major foundations operated on the Right, today’s conservatism has no shortage of institutions, donors or brio.”
If the economics and law movement were to become the standard in our legal culture, it would represent a massive upward redistribution of wealth. Not only would “transfer payments” – unemployment benefits, assistance for needy families and the like – be deemed unconstitutional, but so would minimum wages, job training programs, subsidized student loans and most of our already threadbare social safety net. And that environment will have been purchased for a princely sum by those who have profited so handsomely from America's spiraling income inequality.