Wealth and Democracy

Kevin Phillips' insight into American politics and economics is superb. His bestselling books, include The Emerging Republican Majority (1969) and The Politics of Rich and Poor (1990). In the latter book, he analyzes the United States' history of great wealth and power, and compares it to the "the Second Gilded Age" recently ended. He notes how the rich and politically powerful have worked together to create or perpetuate privilege, at the expense of the national interest and usually at the expense of the middle and lower classes. He exposes the subtle corruption of a money culture and financial power, evident in economic philosophy, tax favoritism, and selective bailouts, justified in the name of free enterprise, economic stimulus, and national security.

He reviews the history of Britain and notes the symptoms that signaled its decline – speculative finance, mounting international debt, record wealth, income polarization, and disgruntled politics. These are the current signs that we recognize in America at the start of the twenty-first century.

Most American conservatives take it as an article of faith that governmental involvement in affairs of the market are to be minimized. However, much of the wealth of the rich is "power and preferment of government" says Phillips. "Laissez-faire is a pretense," he notes. As the wealth of the rich has grown, so has its control over government. Examining the historical cycles of economic growth and decline, Phillips dispels the notion of trickle-down wealth creation. This, together with the ever-increasing "financialization" of the economy, has reduced the well-being of ordinary Americans and government alike. He finds detailed correspondences between the greediness of < "America's Gilded Age and the technology mania and stock bubble of the 1990s." Phillips  notes that "the imbalance of wealth and democracy in the United States is unsustainable," and may well lead to major social and political upheaval from the middle and underclasses. He argues that the accumulated wealth of America's best-off families is a challenge to democracy.