• Home  / 
  • on wealth
  •  /  Blaming “The 1%” is like blaming “Zionists”, “Blacks” or “Gays”

Be ready for the Reboot. Subscribe to new articles via email... »

Blaming “The 1%” is like blaming “Zionists”, “Blacks” or “Gays”

Mark Jeftovic
By Mark Jeftovic / November 2, 2011

Some people like, to make all the rules and tell others what to do.
They make it their way, so they always win, and the others always lose.
Street gangs and madmen How they wage their private wars
In bankers clothes their hearts are froze and
Their wives hold hands with whores

— Airbourne: Too Much, Too Young, Too Fast

There is a lot of “empirical data” coming out in reputable information channels (like Facebook and Twitter) that the 1% are over-represented in the corridors of power, have more than their fair share of wealth and are basically to blame to for mess the world is in right now.

I saw post from a friend on facebook:

“i wish people would stop trying to diminish the efforts of the occupy crew with these cheap shots..get real f***kers..the banking system/and corporations are corrupt as fuck..these people are trying to change things for the better..none of you are the 1% so stop being dicks to the people trying to help you …and its not about just you its for the good of everyone globally”

I think this sums up the ethos of the entire OWS movement. There are three main components to this meme:

1. The banking system is corrupt.

2. Corporations are also corrupt.

3. Nobody you know is “of the 1%”.

When you break it down you will find that 1 out of 3 holds water, and is basically the core of the problem, the other two are red-herrings that are roads to nowhere, and as long as they are held by the popular movement, will never address the real problem.

1. The banking system is corrupt

The real problem is our collective addiction to debt, and the fact that our monetary system is inherently flawed. The banking system is constructed around this flawed monetary system and perpetuates it. The bullet points to describe the problem are as follows, but for anybody who wants to understand this intimately I provide a reading list at the end of this post.

These are:

1. Debt should not be used as money.

2. When debt is used as money, then when money is created there is by definition not enough money in existence to pay back the underlying debt.

3. This creates a “treadmill economy” – where the debts and the economy must continually expand to keep the wheels turning

4. This can only be accomplished in later stages by encouraging consumption and discouraging savings (however it is only via savings and prudent investment – as opposed to speculation – that real wealth can be created)

5. Under this vicious circle, debt is never intended to be repaid, only serviced. But eventually you hit the point where the economy cannot expand fast enough to service the debt (interest).

6. Credit crunches occur, which are basically macabre games of musical chairs: where those furthest from the political center of power, lose.

7. Great “resets” are required to clear out debt, neutralize the losers (before they can foment a revolution) and set the stage for the next cycle. Those resets are called “wars”.

That’s point #1 in a nutshell. And I don’t know whether we should blame a shadowy cabal of bankers at the top who meticulously plan all this, or (more likely) blame stupidity, short-term thinking, postponing pain at any cost, and what I call “the re-election imperative”. In this scenario nobody is conspiring to cause all of this grief, but at each stage of the cycle, given the choices made out of expediency in the previous stage, the next step becomes inevitable. “Never blame on conspiracy what can be explained by stupidity”.

2. Corporations are also corrupt.

Here is where we veer off into the void. “Corporations are evil” is like saying “musical quartets are evil”. A corporation is simply an organizational and legal structure, within which people carry on various activities: business, charity, education and even civic. Yes, there are large corporations who do evil things. Some of them are esconced with the banking system to completely co-opt our political structures and rig the game in their own favour. But there are also corporations who do a lot of other things, like look after your children when you’re at work, feed the homeless, mow your lawn, build your house, and the list goes on. Are they all evil? Of course not!

Further, corporations can be viewed as a societal evolutionary response to a rigged system. When the monetary system is unsound, when we live in an oligarchy where the rules are setup to make everybody outside the immediate circle of power lose: creating a corporation: shifting taxes (which only “feed the beast”), creating corporate personhood shields and other forms of “gaming the system” is not corrupt. It is a sane response to an insane situation.

In other words, quit complaining that corporations have “special privileges” and create yourself a corporation. Use it to bolster your defenses against the oligarchy, use it to further your aims and use it to spread your vision of social justice.

Corporations are a tool. Not a cause.

3. Nobody you know is of the 1% so it’s ok to hate them.

That collectivist instinct to vilify some identifiable party. It used to be “ok” to just hone in on the proverbial other’s skin color or religion. But fortunately we grew past that. Unfortunately we seem unable to put aside the impetus to vilify somebody. Hence, the 1%, that thin slice of cruft at the top of humanity who have “more than their fair share”, and after all, since it’s “nobody you know” it’s ok to hate them.

This article demystified the 1% quite nicely. It turns out that anybody with a before tax family income over 350K/year or a net worth over 1.2M is of “the 1%”. That means your dentist is probably in the 1%. It means a medium sized family-owned plumbing business is in the 1%. It probably means your local union boss is of the 1% and depending on whether he or she is a savvy investor, could well include your kid’s school principal (it can also include your basic nerdy friend who started a small, niche dotCom business in the late 90’s and managed to keep it alive through the tech-wreck and the Global Financial Crisis)

But the point is: the 1% is a fallacy. It’s basically positing a conspiracy that “the world is run by successful people” or that “people with a lot of money have a lot of money”. When you take a step back and look at it you realize that it isn’t an identifiable, vilifiable “other” but just a simple moot point.

Brian Tracy is fond of saying “only 3% of the adult population have written goals, and the rest of us work for them”. What this means is that there is a small minority of the population who always seem to work a little harder, think longer term, defer gratification and make better choices, and those people end up wealthier than the others. How can it possibly be any other way?

You cannot mandate wealth equality by decree. It simply doesn’t work. What you can do, however, is have equality in the following:

  • » the same rules apply to all, regardless of wealth level or proximity to the political epicenter of the state.
  • » equal access to opportunity: it means that everybody is afforded the same opportunity to self-select themselves into whatever strata of society they want for themselves. If public money should be spent anywhere, this is probably the one place where it makes sense: education, education, education: Crank up the intelligence and the abilities of as many people as possible and  create an unrelenting drive upward in achievement. Alas, the system today does the opposite. We teach conformity, we discourage independent thinking, and we penalize success.
  • » equal respect for collective rights, worldwide. This means if you’re going to assert inalienable rights for your own way of life here, you have to respect other societies rights elsewhere. That doesn’t mean “it’s ok when we do it, but if you do it we’re going to start dropping bombs on you”. It means, end the wars. To date, the west has spent in excess of 4 trillion US dollars on “The War on Terror” and killed hundreds of thousands of people. Whatever you think the war is about, I can guarantee that most of those dead people (that we killed) had nothing to do with it.

I think if there’s one sentiment that all of the global movements today are trying to further it’s one of basic structural reform but beyond that fairness. Level playing fields. Why should one group have to bear the brunt of an economic contraction while another one (one who arguably caused it) is exempted, bailed out or even rewarded? (Or for that matter, why should one group who plays by the rules, did not cause this problem, is not shielded by special exemptions, who creates employment and has their income taxed at roughly 50%, has their dividends double-taxed, be required to pay even more toward bailouts, resulting entitlements and wars?)

But the problem with the movements is that they are being led down the garden path: they are asking for stronger government regulations when the government is hopelessly corrupt and captured by special interests. They are blaming “the 1%” for everything and that’s really just a mindless label to demonize some hypothetical “other”.

Get off Wall Street and head to Washington. Demand they end the War. Demand they End The Fed. That will hit the bankers, the special interests and the oligarchy on wall street harder than anything they could possibly do from Zuccotti Park.

Further Reading

The Monetary Elite vs. Gold’s Honest Discipline by Vincent LoCascio. Not that I think it’s possible to go to a gold-backed monetary system, but he does a great job of deconstructing the current regime, exposing the hidden damages of government bailouts, deposit insurance and interest rate controls.

The Creature From Jeckyll Island: A Second Look at the Federal Reserve

The Lost Science of Money by Steven Zarlenga Possibly the only comprehensive study of basic mechanics of debt-based vs. non-debt based monetary systems.

The Sovereign Individual – Stop Complaining, read this. Take control of your own life and it will no longer matter who makes the laws or how they rig the game.

About the author

Mark Jeftovic

Mark Jeftovic is the creator of Wealth.net, founder and CEO of Canadian domain registrar and DNS provider easyDNS.com and member of the indie rock sensations The Parkdale Hookers.

His personal blog is at markable.com

Simon - November 4, 2011

There might be some mileage in “corporations are corrupt”.

We know that how we structure people’s lives strongly influences their decisions, think Stanford Prison experiment. The modern multinational, public company structure may be one that encourages short term profiteering.

I’ve seen wealth creating potential destroyed by people seeking their next bonus cheque. The corporate structure shaped so that people prepared to do that are promoted into positions of influence.

There is something wrong with the structures when so many employees at large firms are conspiring to commit fraud.

I think here is the UK that the radical tax changes brought in by Thatcher (I think Reagan did similar) were simply based on flawed economics and only enacted because they coincided with the self interest of the wealthy on the right of politics. As a result we have twice as many disenfranchised poor, huge government debt, and the established elite rolling in money.

Depressingly we see a rise in so called libertarian ideas which are based on similar intellectually vacuous ideas, and an unsubstantiated faith in, the “free market”, without realising most of those “free markets” exist and work because of government and similar societal structures.

I’m surprised at how strident the responses to the new government in the UK have been, revolution is in the air. I doubt the cards will settle much differently, they rarely do.

Ed - December 31, 2011

Good article. I think the bigger and “real” issue is that our societies are trained to blame someone, label someone, find a common enemy, etc. These are simple psyops manipulations of the masses that have gone completely out of control. Probably much simpler and easier to maintain and control this mass conciousness psyops tactic back in the days of “the red threat”.

Any to make my point. What I see as the biggest problem of all is a lack of any type of real original or free thinking that is designed to actually result in a solid goal or at least a good outline to follow that would actually unite and unify people in a way where they could precisely focus on that goal.

One thing that everyone can agree on that is perfectly clear is this system is a total mess. Much like a company becomes a mess when you have terrible managers. The influence from the persons in charge trickles down and affects everyone positively or negatively. In this case someone just needs to flush the handle to get this turd out of the bowl.

Ok so really making my point now. Who is it exactly who wants full global control of this planet and all its resources? Is it one person or is it a group of people. Just like the huge mess is obvious, it is obvious that “the powers that really be” have either lost control of the situation, the screwed up or the intended goal is for this thing to self destruct.

What i see happening on all levels (government, etc) where things could be improved is more shit is being piled onto the disaster. So really I think people should be focusing on looking at what the intended goal is. Maybe once that is understood then the creators of this disaster could be dealt with.

Or is this all the regular cycle of the human species shitting where it eats and eventually the same pattern that has been occurring for thousands of years will just happen again and again – rise to power – blood bath – rise to power – blood bath………

lewy14 - January 14, 2012

Jeff, I wandered over here from Zero Hedge – dunno if you’ll read this but what the heck.

To a first order I agree with your take – the problem is banks and banking, not “corporations and the “1%”.

However, I don’t think there’s any real “sustainable” solutions, really.

Let me parsimoniously muster all available evidence to support the thesis that “in the long run we’re always screwed”.

Debt should not be used as money – OK, start there. So we use gold, or something else. (I’m working out an idea to use aging cheddar to back locally circulated notes, but whatever – won’t be debt, but claims on real stuff).

But then debt happens. In a free land, people are free to strike contracts.

Then those contracts start to circulate as a kind of barter. And very quickly, you get things like securitization – a genie which will no more re-enter it’s bottle than the nuclear genie will.

And the bad money of debt will drive out the good money of gold (or cheese) just as Gresham’s law will predict.

This has happened many times in the past. Gold backs notes, and then notes back notes, and they’re the rage, because hey, notes! Till it all falls apart.

Of course you could start banning stuff. And here’s were I’d offer my conjecture: any sufficiently aggressive set of controls on the creation of debt is objectively equivalent to bolshevism. It would throw the baby out with the bathwater. The freedom to do business would be shut down.

You say you ran your business without debt? That’s awesome. Perhaps if we put you in charge of the world, you could run it without debt too. Nothing against you, but personally I doubt it.

Lots of bad stuff happens in bubbles. Lots of good stuff too. I fear it’s an intrinsic part of our nature; “why do we keep having debt crisis” is akin to “why do children still go to bed hungry in this world”. Unless you an avatar of the divine come to lift us out of sin, and can solve both, I have to trust that any human being (awesome though they may be) will fail to solve either.

Josephconrad - February 2, 2012

When the paragons fo the “Too Big To Fail” tripe start going to jail or ‘disappearing’, then that will be newsworthy. Till then, th real news is not the increasingly violent actions of the <1% Wealthy Thieves, Thugs & Liars & Cheats, but the seeming readiness of th 99%+ to sit by quietly and nonviolently as iff watching a 'Disaster Sitcom' where they're forever the victims and suffer their fate gladly. The Wealthy Always win and the 99%+ play by th rules and ALWAYS LOSE horribly, blatantly and stupidly.

Click here to add a comment

Leave a comment:

Google Analytics Alternative