Home Economics The Greatest Robbery in the History of the World

The Greatest Robbery in the History of the World


In 2008, the top income earners in this country and major corporations and the Republican Party and Wall Street completed the greatest theft of assets and exchange of wealth from one group of citizens to another in the history of the world. The average American citizen makes about $50,000 per year. But the debt piled on them by the Republican Party and their corporate financial supporters amounts to another $43,000 per family.

This is not a case of “both political parties do it.” Reagan tacked on $1.9 trillion debt, most of which went to military contractors. Bush the First, though, to his credit he tried to raise some revenues, added another $2 trillion, and Bush the Lesser added an astonishing $7 trillion while in office and then left the country in a Depression that added another $4 trillion. So the theft accelerated from Reagan to Bush to Bush, even though Clinton was able to stop it for a few years.

Some will say that the trillions added since 2009 are Obama’s fault but let us just dispel that myth right away. Bush and Cheney put Chris Cox, virtually the most vocal anti-regulation Congressman of all time into the Chairmanship of the Securities Exchange Commission. He went to the SEC with the express purpose of making it impotent. He fired regulators, told others not to investigate, not to prosecute and literally threw cases against offending securities firms into a waste basket.

Under his “watch” anti-regulatory activities reached an all time high. For example, Bernie Madoff created one of the biggest scams of all time, $50 billion in fraudulent securities sales right under his nose. But Madoff was a piker compared to Bear Stearns and Lehman Brothers and Bank of America and Merrill Lynch and AIG and Goldman Sachs and Countrywide Financial. They sold fraudulent securities that created a huge speculative market that collapsed, basically costing the entire country trillions of dollars.

But this isn’t the first time this has happened. Because the story is not about the robbery itself, the theft of wealth by the rich from the Middle Class. The story is more complicated than that and unless we understand it we will…not “may”…go through it again.

In the days after the Second World War, the late 1940s, the discussion of what had happened leading up to the war and the horrible details of the war itself…mutilated bodies, horrific deaths…by fire, explosion, bullets, bombings, drowning, falls from planes, flesh torn apart by huge pieces of metal…all these things, plus the massacres…that discussion was like pulling an enormous scab off a monumental wound.

Even so, we began to examine what had happened to cause all this devastation and the deaths of 50 million people. And through that examination, we learned that in Germany, long before the wars started, one of the greatest robberies in history had taken place.

German and Austrian and Polish and French and Belgian and Dutch and other Jews who came under the control of the Nazis were robbed. Yes, they were murdered. But they were murdered not only for some idealistic reason. They were murdered for a more tangible reason. They were killed for their gold, their businesses, their jewels, their art, their real estate and even their clothes, hair and skin.

So it was not some ideological movement. It was a means to conduct the worst and greatest robbery in history….and the most grotesque.

And yet it was not the largest or most expensive. Because, you see, our American Establishment, our own multi-millionaires, billionaires and multi-national corporate managers have exceeded even the vicious greed of the Nazis and are on their way to the same kind of extermination. The current plan of the Right Wing of the American body politic has already exterminated a large segment of the middle class…that is, robbed them of the assets that made them the Middle Class.

They have taken the homes from millions of Americans and taken the jobs from so many other Middle Class Americans and reduced them to poverty-level wages that we now have the largest segment of the population in poverty in our recorded history.

By 1969, according to Forbes magazine, hardly a Socialist rag, with Liberal Democratic programs in place we had reduced the number in poverty to 12%, or 18 million. After the Reagan and Bush revolutions, including a Conservative “belt-tightening” of government and $16 trillion more added debt, we now have 16% or 49.6 million in poverty. Obviously something went wrong.

We know what went wrong. Forbes knows what went wrong. Ronald Reagan lied to the American people. He said that cutting our taxes would lead to maximum tax revenues, a balanced budget and a better economy with more jobs. That was not true. Under Reagan, unemployment grew to 10.8% and then averaged 7.5% for his 8 year term. So while he created 16 million jobs on paper, the economy grew rapidly because, like China, we had such a distance to go just to get back to normal.

Reagan created economic activity but he did so by tripling the amount of money spent on military hardware. That did create some good jobs but it also created a large military-industrial complex that the manufacturers spread into as many Congressional districts as possible in order to have government support for their businesses. These were good jobs with good benefits, just as there are good jobs in the oil and chemical industries. But the question is…how do these companies serve the public? Are good jobs in the oil patch being created through high gas prices?

The Right Wing maintains that if only the poor (by which they mean their desired underclass…African Americans) would finish high school, keep gainfully employed and not have children out of wedlock, the number of people in poverty, and therefore (their big concern) on welfare, would disappear.

This argument is very easily demolished. The rate of unemployment right now for those with a high school education and 25 years of age or older is 7.6%. We know that the rate is approximately two points higher than that because of surveys that show those who do not believe they will ever get work eventually drop out of the government employment statistics. So we’re talking about one out of ten high school graduates who cannot get a job. Given the 10% unemployment among non-high school grads, we’re talking about a lot of unemployed. We’re talking about 18 to 20 million people.

Would a high school degree and drastically reduced out-of-wedlock and single parent situations make things better? Well, they wouldn’t make things worse. But they aren’t the answer. And that’s the point. When there are 5 applicants for every job, which has been the case from 2009 (when we were losing jobs at the rate of 700,000 per month until the Obama stimulus took hold) until recently, then you cannot say that there are a bunch of lazy people out there collecting unemployment.

Yes, there are a lot of illegal immigrants out there working for less than minimum wage. And we applaud their industry but it does not mean that we should expect everyone to do it. Have you ever looked for a job in the paper? Pick up the classified section and see how many jobs you qualify for out of the first 100, or even the first 50. You will see that, at whatever skill level you have, most jobs require something you do not have…education, experience, physical capacity. Why should that be any different for others? It isn’t.

So, people want to work. They like to learn skills and apply them. Some people, yes, do not want to work and some of those have that mind set because they are the third or fourth generation born into that environment. If you are what you eat, then you most often become what you were raised to be. Statistics show that poverty does not breed financial success and being born into wealth does not breed people who become impoverished. Poverty breeds poverty; wealth breeds more wealth.

Approximately 46 million Americans live in poverty in this country today. Of those, 19 million are white, which is almost double the number who are black or African-American. So poverty in the United States is predominantly a poor-white problem if you want to characterize it in black-white terms. If “poverty” is defined as the government does, it is a single person living on less than $12,000 a year income or a family of four living on less than $23,500.

The Republicans deny the theft of assets. They merely ignore it and hope it will be swept under the rug. Instead they rail about poverty—the poverty that they have created—and blame it on low education, lack of ambition and unwed mothers. The high numbers in all those three categories are true. The problem is that these things are symptoms of poverty rather than causes of poverty. The Republicans have come up with only one solution. Cut welfare. Starve people back to work. That is not only an uncivil solution, but realistically no answer at all. That is merely the answer that rich conservatives want to hear. It is an answer to a question we have not asked, which is: how do we save money for the rich on welfare? The answer is, of course, to cut welfare. And that is the question and the answer they seek.

Why do people work? They work because they enjoy a feeling of accomplishment, personal satisfaction at doing something well. They work to earn money to buy things. They work to have personal relationships and to have personal security. In many cases people work because they have skills or professions that they sincerely enjoy, which often become less than work.

Other tens of millions, perhaps even hundreds of millions of people work in jobs that they would not choose but accept, sometimes even enjoy because that is what they need to do. Others work in jobs they dislike but do those jobs with a good deal of efficiency and good nature because those jobs pay the bills. Their lives are not identified with their jobs but they still do them

So lack of the will to work is not the problem. Republicans would like you to think that people are motivated naturally to simply sit around and that it takes some sort of effort of the will to get up each day and go to work. But ask anyone in early retirement if that is what they wanted to do and many of them, perhaps most of them, will tell you that they are bored and look for some new occupation or meaningful hobby to fill their time.

People cry when they retire. Why? Often it is because they are leaving so many personal relationships…some good, some bad…but many human interactions. We are part of a community when we work. And many people who go from welfare to work, after a few years, will tell you that the most important thing to them is interaction with others in the workplace, a feeling of belonging to a group.

So, finally, before we discuss what the American people have lost, let us consider that Americans, particularly those Americans who have done our dirtiest, worst paying, least attractive jobs…are not lazy and have not succumbed to the “appeal” of less-than-poverty-level payments from welfare.

Instead, the truth is that Americans are industrious. The losses that Americans have suffered have led to the notion that those who lost jobs and could not find another, all those who have lost their life’s savings or lost relationships when companies closed….all these people cannot compete or do not want to compete in a globally competitive world. The fact is that they do. The other fact is that they have been robbed of a huge part of what they so arduously worked and prepared for.

And how were we all robbed? Here is how it happened and how it is still happening.

It began with Reagan. In 1981, Reagan cut the top tax rate from 70% down to 50% and then to 28%. The effect of that tax cut was that the very wealthy began to make large amounts of money from reduced taxes. Someone paying $700,000 on their first million of income over the top tax rate now paid $280,000. Now there is nothing wrong with that so long as government is cut back so that it stays in balance.

The reason for government to stay in balance is that we all use government services. The rich generally do not need most services and so they often object to the large amounts of tax that they pay. That is why they have groups like Citizens for Tax Justice and people like Grover Norquist who lobby for them constantly. But Reagan did not cut government. In fact, he expanded government.

The result was that he increased government debt dramatically. Now what is government debt? It is the theoretical amount that each of us owes the treasury because we borrowed more than government took in to cover the cost of services. But, after a while, this amount does not become theoretical. After a period, government decides that it must put the brakes on spending because the debt has grown too large.

And what has happened to the United States? We now have commission after commission trying to decide on ways to cut government. And the most common way, given the tenor of current politics is to cut government “entitlement” benefits, those services that Americans have paid for in taxes but Right Wing Republicans feel are free services that citizens receive.

The reality is that the government services that Americans paid for…including wealthy Americans…have been stolen. In their place, Reagan, Bush the First, Bush the Second and Cheney have left IOUs on which they would now like to renege. In other words, they took your services, ones that you paid for, and borrowed from them to give tax breaks to the wealthy. They didn’t raise taxes to pay for wars or prescription drug giveaways. They didn’t pay for anything. They spent $7 trillion dollars in 8 years and they billed it to you.

Since 1981, the Republicans in Congress (not the Democrats, by the way) have both allowed the President to spend indiscriminately and legislated their own agendas to steal money from you and give it to the rich. You are now in debt by $17 trillion dollars. And in addition, Wall Street took from you another $7.5 trillion in your own personal accounts.

For example, instead of a house worth $500,000 in 2008, by 2010, that house may have been worth only $300,000 or $350,000. You lost between $200,000 and $150,000. Your 401K went down. And millions lost jobs which means that they had to live on reduced earnings (unemployment) perhaps dig into savings, or sell a house at a reduced price. So, in addition to the debt the Bush-Cheney administration added to your theoretical net worth (a potential loss of government services) they also added real debt to your family.

So the real theft, if you want to add it all up, is a phenomenal approximate (thus far) $24 trillion dollars. And what has happened to the people who stole this money from you…the top 1%…because they are the ones bankrolling the Republicans? They have gained almost the same amount. It is like a balance sheet. Current estimates put the personal wealth of the top 1% at an aggregate $45 to 60 trillion dollars….three times or four times the national debt. They could pay off all the national debt…all of it…and still have $40 trillion left among them, most of which would go to the top one tenth of one percent, actually fewer than 300.000 people.

If that seems hard to believe, then take this to the bank. It is a fact that 6 heirs to the Walmart fortune alone hold more wealth than the 42% of Americans at the lowest end of the income scale. Because there are so many more poor people, you can quickly see that this is a lot of people, huge numbers of Americans versus six people.

The important point, however, is not who makes what. Bill Gates and Warren Buffett and Walter Annenberg and the Rockefellers and Andrew Carnegie and many, many other very wealthy people have given away billions of their wealth. What we are talking about is not wealth versus poverty. We are talking about theft.
When George W. Bush cut taxes for the wealthy in 2001, even though he knew we couldn’t afford it, and when he and Cheney cut taxes again in 2003, after we were in a recession, had started two wars and had a huge problem with the gigantic price increases the drug companies were levying on seniors, they knew it was theft.

They knew that they were borrowing money from China to give to rich Americans by pledging the government bonds that they knew Americans all owned. In other words, to pay off those bonds that were used to make tens of thousands of dollars of tax rebates to the wealthy, they would have to borrow from the American people (steal I would call it) and obligate all Americans to pay back the money they were giving to the rich. Those tax breaks and the subsequent lack of funding for government and the interest on that borrowing and the cost to society….was over $5 trillion dollars. Then there was the cost of an unnecessary war in Iraq. That was at least $2 trillion.

You owe this money. And the rich have your money. There is only one way to get it back. The same way that they got it from you. Tax the rich at the same rate that they were taxed when Reagan came to office. No taxes stay the same forever. A short tax cut for the rich might have been justified in 1981. But not three more tax cuts and two wars unpaid for and all of it lasting until today…until 2013. That is not tax policy. That is outright theft, using the government as a piggy bank.

Do not believe anyone who tells you that you cannot tax those who make over $500.000 by 70% on those dollars they earn over $500,000. You can and you must. The result will be very simple and predictable. The wealthy will not pay those taxes. They will invest those amounts on which steep taxes are levied. So long as we make any business deductions contingent on investments being done here in the U.S., the inevitable outcome will be more investment, more industrial growth and more jobs…and more tax revenues.

Just as the Nazis lied about the Jews with disastrous consequences for the Jews and then for the world, so the Republican Party, a party devoted to making people believe that they want lower taxes to make government more efficient, has in reality dedicated itself to making the rich richer and thereby earned more in campaign contributions to stay in power. Just as with the Nazis, they are not about ideology.

They are merely thugs, in power to steal your Social Security, your health care and all the other services that you paid for over the years and over generations. We have showed already that the very rich alone could end our national debt and hardly feel an economic pinch. Instead they want to continue to steal from you, money which they have already embezzled, but money that they could be made to pay back…if you have the political will.

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