The
parasitical ultra-rich often deny the role of others in the acquisition
of their wealth – and even seek to punish them for it
We could call it Romnesia: the ability of the very rich to
forget the context in which they made their money. To forget their
education, inheritance, family networks, contacts and introductions. To
forget the workers whose labour enriched them. To forget the
infrastructure and security, the educated workforce, the contracts,
subsidies and bailouts the government provided.
Every political
system requires a justifying myth. The Soviet Union had Alexey
Stakhanov, the miner reputed to have extracted 100 tonnes of coal in six
hours. The US had
Richard Hunter, the hero of Horatio Alger's rags-to-riches tales.
Both
stories contained a germ of truth. Stakhanov worked hard for a cause in
which he believed, but his remarkable output was probably faked. When
Alger wrote his novels, some poor people had become very rich in the US.
But the further from its ideals (productivity in the Soviet Union's
case, opportunity in the US) a system strays, the more fervently its
justifying myths are propounded.
As the developed nations succumb
to extreme inequality and social immobility, the myth of the self-made
man becomes ever more potent. It is used to justify its polar opposite:
an unassailable rent-seeking class, deploying its inherited money to
finance the seizure of other people's wealth.
The crudest exponent of Romnesia is the
Australian mining magnate Gina Rinehart.
"There is no monopoly on becoming a millionaire," she insists. "If
you're jealous of those with more money, don't just sit there and
complain; do something to make more money yourselves – spend less time
drinking or smoking and socialising and more time working … Remember our
roots, and create your own success."
Remembering her roots is
what Rinehart fails to do. She forgot to add that if you want to become a
millionaire – in her case a billionaire – it helps to inherit an iron
ore mine and a fortune from your father and to ride a spectacular
commodities boom. Had she spent her life lying in bed and throwing darts
at the wall, she would still be stupendously rich.
Rich lists are
stuffed with people who either inherited their money or who made it
through rent-seeking activities: by means other than innovation and
productive effort. They're a catalogue of speculators, property barons,
dukes, IT monopolists, loan sharks, bank chiefs, oil sheikhs, mining
magnates, oligarchs and chief executives paid out of all proportion to
any value they generate. Looters, in short. The richest mining barons
are those to whom governments sold natural resources for a song.
Russian, Mexican and British oligarchs acquired underpriced public
assets through privatisation, and now run a toll-booth economy. Bankers
use incomprehensible instruments to fleece their clients and the
taxpayer. But as rentiers capture the economy, the opposite story must
be told.
Scarcely a Republican speech fails to reprise the Richard
Hunter narrative, and almost all these rags-to-riches tales turn out to
be bunkum. "Everything that Ann and I have," Mitt Romney claims, "we
earned the old-fashioned way". Old fashioned like Blackbeard, perhaps.
Two searing exposures in Rolling Stone magazine document the
leveraged buyouts which destroyed viable companies, value and jobs, and the costly federal bailout which saved Romney's political skin.
Romney
personifies economic parasitism. The financial sector has become a
job-destroying, home-breaking, life-crushing machine, which impoverishes
others to enrich itself. The tighter its grip on politics, the more its
representatives must tell the opposite story: of life-affirming
enterprise, innovation and investment, of brave entrepreneurs making
their fortunes out of nothing but grit and wit.
There is an
obvious flip side to this story. "Anyone can make it – I did without
help", translates as "I refuse to pay taxes to help other people, as
they can help themselves": whether or not they inherited an iron ore
mine from daddy. In the article in which she urged the poor to emulate
her, Rinehart also proposed that the minimum wage should be reduced. Who
needs fair pay if anyone can become a millionaire?
In 2010, the
richest 1% in the US captured an astonishing 93% of that year's gain in
incomes. In the same year, corporate chief executives made, on average,
243 times as much as the median worker (in 1965 the ratio was 10 times
lower). Between
1970 and 2010, the Gini coefficient, which measures inequality, rose in the US from 0.35 to 0.44: an astounding leap.
As
for social mobility, of the rich countries listed by the OECD, the
three in which men's earnings are most likely to resemble their father's
are, in this order,
the UK, Italy and the US.
If you are born poor or born rich in these nations, you are likely to
stay that way. It is no coincidence that these three countries all
promote themselves as lands of unparalleled opportunity.
Equal
opportunity, self-creation, heroic individualism: these are the myths
that predatory capitalism requires for its political survival. Romnesia
permits the ultra-rich both to deny the role of other people in the
creation of their own wealth and to deny help to those less fortunate
than themselves. A century ago, entrepreneurs sought to pass themselves
off as parasites: they adopted the style and manner of the titled,
rentier class. Today the parasites claim to be entrepreneurs.
Twitter: @GeorgeMonbiot
A fully referenced version of this article can be found at
www.monbiot.com
http://www.guardian.co.uk/commentisfree/2012/sep/24/mitt-romney-self-creation-myth