Billionaires are not like us. They don’t share the same experiences as the rest of us, they don’t see the world in the way we do, they don’t live the same struggles that we do—indeed, their daily reality is so foreign to everyone else that they do not even seem human. But the problem isn’t just that they’re out of touch—it’s far worse than that. The wealth of billionaires and the widespread poverty and precarity among the rest of us are two sides of the same coin. Their exorbitant profits depend on our low wages.
During this year’s Democratic primaries there was much talk of these strange creatures. Case in point: a few weeks ago MSNBC held a panel about the plight of billionaires with journalist Chuck Todd and former advisor to Jeb Bush, Michael Steel. Todd argued that Bernie Sanders was “alienating” billionaires, Steel said that billionaires “made a fortune making our lives better”, and the whole panel concurred that the Democratic Party was “against aspiration” insofar as “people want to make money, don’t say they don’t.” The leading idea was that being critical of a system that creates billionaires means you are against ordinary working class people “making money.
And this is just one example. The business of defending the honor of billionaires in the face of public outrages about their conduct is practically a cottage industry these days. But the problem is not that the Democrats—especially Sanders and other ‘progressives’—are too harsh on billionaires. If anything, the problem is that they aren’t harsh enough.
Before anyone is tempted to start feeling bad for this tiny clique of oligarchs, we need to ask: just who are these billionaires who are apparently victims of such unfair treatment?
Let us start with just how many of this “alienated” demographic there are. In the United States there are 607 billionaires in a country of over 350 million. Thus, billionaires make up just 0.0001 percent of the US population, or one out of every 550,000 people. But despite being such a numerical minority, they hold more wealth than the bottom seventy percent of the US population (or to put it another way, more than the GDP of Great Britain). In fact, the three richest billionaires in the U.S. own more wealth than the entire bottom half of the country. That is to say: three people hold more wealth than 164 million Americans combined.
But what really is a billion dollars? How much money do billionaires actually have? All these numbers, —millions, billions, trillions—can all seem very abstract. One way to make these numbers seem less abstract is to imagine them as seconds of time. One million seconds is 12 days, so one million seconds ago it was April 3rd, 2020. A billion seconds is 31 years ago, so a billion seconds ago it was 1989—whereas a trillion seconds is thirty-one thousand years, so a trillion seconds ago it was 28,980 BC.
To put that in perspective: if dollars determined our lifespan, with each second costing a dollar each, most of us could afford to live 9 hours whereas a millionaire could afford 12 days and a billionaire 32 years.
But what may be even more helpful to understand how much money billionaires have is to look at how much money they have in relation to other people. So, consider the following thought experiment: if you worked every single day making $5,000 per day, from the time Columbus began his invasion of America to the time at which you are reading this article, you would still not be a billionaire, and you would still have less than what Jeff Bezos makes in a single week. To put it another way: if the first human being 250,000 years ago got a job at $20 per hour, then worked 40 hours per week, 52 weeks per year for the next 250,000 years without ever spending a single penny of what he earned, she would currently have a net worth of 1/12th of Jeff Bezos.
According to Forbes Bezos made $149,353 a minute, or just under $9 million dollars an hour in 2018. When Jeff Bezos goes to bed at night, he knows that when he wakes up the next morning, after having slept eight hours, he will be $71 million richer. It would take the average Chicago public school teacher about 1,008 years to make what Bezos made in those 8 hours of sleep.
This context is important as some have given great praise of Bezos donating 100 million dollars to food pantries because of the COVID-19 (while Amazon workers continue working at great risk). But 100 million is just 2 percent of what he made over just the last three months. By comparison 2% of what a Chicago teacher made in the last 3 months is $355 dollars, hardly a heroic charitable amount that justifies billionaires being seen as benevolent philanthropists. Certainly many working class people have donated far larger percentages of our meager weath.
But it’s not just Bezos. For example: Ken Griffin, Chicago’s wealthiest resident, is worth about $8.6 billion. It would take the average Chicago public school teacher 120,000 years making $71,150 a year, to have the same net worth as Griffin. And that, of course, assumes that the teacher didn’t spend a single penny during those 120,000 years. This would have them starting their career in the Middle Paleolithic period, when humanity was using stone tools and evading saber-tooth tigers.
While this 0.0001 percent of the country walks around with over half the nation’s wealth, roughly a fifth of Americans have zero or negative net worth, and 78% of Americans live paycheck to paycheck. While the top 1 percent own more wealth than the bottom 90 percent, the bottom half of the U.S. population live in or near poverty. These facts are deeply interrelated: There’s a relationship between those at the top and those at the bottom and it is not as Michael Steel said that billionaires are “making a fortune off of making our lives better.” Billionaires’ lives are so extraordinary precisely because ours are so onerous.
Lets take the Walton family, who made their fortune from Walmart, as another example. Walmart is, when measured by revenue, the largest company in the United States. Walmart’s revenue is almost double that of Exxon, the second largest company in the US. It is also the largest employer in the United States, employing 1.5 million Americans. Jim, Alice and Rob Walton, the heirs of Walmart, have made a fortune from the retailer. Each of them is worth about $51 billion each. If we were to combine the wealth of the three of them, they would surpass Jeff Bezos and have the highest net worth in the world. But they did not make this fortune by “making our lives better.” Indeed, they didn’t “make” this fortune by doing much of anything at all—anything, that is, apart from being born with the last name “Walton.”
It comes as little surprise, then, that Wal-Mart Stores Inc. (the parent company that owns Walmart and Sam’s Club) is the lowest paying private employer in the United States. No large private employer pays their workers less. This is made possible by Walmart’s strict anti-union policy—each year, pouring millions of dollars into anti-union legislation and punishing any workers who attempt to unionize.
The result is that, assuming a 40 hour work week, the average Walmart worker earns less in a year than the Walton family earns in a minute just from the dividends paid on the family’s stockholdings. Again, just from dividends alone.
What about Jeff Bezos, CEO of Amazon and richest man in the world. Did he make his fortune off “making our lives better”? Hardly. Amazon’s famous speed, cutting-edge technology, unrelenting surveillance, and constant disciplinary write-ups have driven the company’s global expansion and made Jeff Bezos the richest man on the planet. But these feats were achieved by—and largely accomplished at the expense of—millions of workers. To give but one example: in order to achieve the speed that makes Amazon famous, warehouse workers are required to carry around scan guns with an LCD screen listing tasks and a timer counting down exactly how many seconds remain to complete each task. As one Amazon worker puts it, “It also tracks your location by GPS – and you take it everywhere with you, even the bathroom… failure to stay ahead of the countdown was grounds for termination”.
It is no surprise that under these conditions Amazon warehouses have been called “injury mills.” As the Atlantic writes: “The rate of serious injuries for those facilities was more than double the national average for the warehousing industry: 9.6 serious injuries per 100 full-time workers in 2018, compared with an industry average that year of 4.” For the sake of profits, Amazon – like many other employers—has turned their workers into nothing less than robots.
The COVID-19 pandemic has underscored the atrocious conditions in which Amazon workers are forced to toil. It is not just the risk of injury, but the spread of a deadly virus that required action by the workers like those at Amazon’s warehouse in NYC and Chicago to force companies like Amazon to begin to take seriously the very lives of these “essential workers.”
Not only are the working conditions dangerous but, like Walmart, Amazon pays their workers far less than a living wage. As with Walmart, Amazon owners get rich because workers at the company create far more wealth on the job than they get paid in hourly wages.
Workers, of course, instinctively realize this and look for ways to resist being ripped off by their employer. Thus, after months of popular pressure, worker activism and public criticism of Amazon’s grueling labor practices, the company announced that it was going to pay all workers at least $15 dollars an hour. Of course,Amazon only raised wages to save its corporate brand, and for no other reason than for its symbolic importance. But even after they raised wages, workers are still not making a living wage. According to MIT, $15 an hour is still not a living wage for a family of four, which estimates the hourly rate would have to be $16.14 per hour on average nationwide to meet the standard. Amazon also relies on large number of contractors who are generally not offered health care. And Amazon, like Walmart is vehemently anti-union and has resisted unionization efforts at every imaginable turn.
The corporate rip-off tactics don’t stop there, however. Despite Amazon making over $11.2 billion in profits in 2018, the e-commerce giant paid $0 in federal taxes. Not only did Amazon not pay any federal taxes — for the second year in a row — they in fact received a federal tax rebate of $129 million. But it was not just Amazon that paid no federal taxes in 2018, there were sixty Fortune 500 companies that paid no taxes that year. These companies made a combined $79 billion in profits in 2018, again $79 billion dollars that went untaxed. 2018 was also the first time in US history that U.S. billionaires paid a lower tax rate than the working class.
And yet, even though they pay no taxes themselves, they are happy to gorge themselves on public funds when the economy is in crisis–like the most recent pandemic-assisted depression we face. Trump’s pro-business multi-trillion bailout passage stands to deliver, at minimum, 500 billion dollars to large corporations while ordinary Americans stand to receive about a thousand dollars two months from now—if they receive anything at all.
Thankfully in recent months the topic of billionaires has been a hot topic, particularly in the Democratic debates. But was Bernie and ‘progressive’ Democrats really too hard on billionaires, as MSNBC would lead us to believe or are they not harsh enough?
Though he has discontinued his bid for the nomination, the case of Sanders’ approach to billionaires is instructive, however, because if anything it is too kind—not too harsh. Under his wealth tax plan, billionaires would pay a measly five percent tax on their net worth between $1 and $2.5 billion and the rate would increase to six percent on net worth from $2.5 to $5 billion, seven percent on net worth from $5 to $10 billion, and eight percent on wealth over $10 billion. According to his website this would generate an estimated $4.35 trillion over the next decade.
Even this proved too much for the outlet MSNBC, however, but, even still, this plan leaves billionaires intact. Under this plan, their lives would not really change, they would still be permitted to live in their alien worlds of unfathomable wealth and this would continue to shape how they think about and relate to the world. It would still take a Chicago public school teacher over 1,000 years to make what Bezos makes in a week.
Undoubtedly those trillions could fund various social programs and reforms that would be positive. But the sheer enormity of their stolen wealth would remain. Workers would still be exploited, would still be working backbreaking jobs for wages that don’t pay the bills, and still living paycheck to paycheck. This begs the question: why not a 50% tax on billionaires, or—even better—outright expropriation? If a 5-8 percent tax on assets over a billion dollars generates $4.35 trillion over a decade, imagine what a 100% tax could do. Instead of more bailouts and handouts, we should take them for all their worth. We shouldn’t want just an eight percent fee on their stolen hoard; we should aim to take the whole thing. Why not take back what’s ours?
Billionaires are not an alienated class but an alien class; billionaires didn’t make their fortune making our lives better. In fact, the existence of billionaires and the existence of a system that produces billionaires is making our lives significantly worse.