Heather Cox Richardson is a professor of history at Boston College and is also the author of a very popular “Letters From An American” nightly newsletter. I have found her discourses informative. She is profoundly concerned about the direction of the Republican party in the US, and might be considered a biased source by some, but I find her reasoning to be generally solid. 

Her reliability as a source matters little in what I’m about to relate, because she simply passed along information from a speech by US Treasury Secretary Janet Yellin. Yellin is quoted as saying “Going forward it will be increasingly difficult to separate economic issues from broader considerations of national interest, including national security….She called for limiting supply chains to “countries we know we can count on” and for developing trade and data exchanges with those same countries in such a way as to protect American workers.”

On December 30^th, I wrote “In a world where war, famine and pestilence are growing threats, we should take concrete action to re-establish capability to produce important products ourselves.

I think that we should, as a matter of national security, establish a list of things for which we will not be dependent on another nation. We might be willing to trade for some of those goods, but we should make enough of them that we have the capability to scale up if we need to. A second list would be those things for which we could be dependent only on friendly nations – our strongest and best allies. And even in that list, I would suggest that we need to ensure we have diverse and dependable supplies.” 

I mention all that simply because I want to take credit for reaching that conclusion some 3 months BEFORE the US Treasury Secretary got there. Now mind you, my article was concerned about protecting supply chain for Canada, not America, and my article went on to mention that I am significantly concerned about the reliability of America as a trading partner. I’m sure Ms. Yellin didn’t reach that conclusion. Nevertheless, I believe our positions are aligned. Her statement reinforces my opinion that events in this year – the pandemic, the war in Ukraine, the continuing rise of aggression in authoritarian governments – will significantly affect the way nations look at trade relationships, and may result in a certain amount of disengagement from the “global economy”.

It’s nice to feel I was right about some of that stuff, because it nicely balances my growing sense that I was wrong about some other stuff that I wrote early on in the first series of articles I wrote on taxation. I wrote that I hated wealth tax and property tax, and that I despised the NDP for their “Stick it to the rich” attitude. My attitude about the filthy rich was that they really ought to be heavily engaged in philanthropy, but that we had little moral right to demand that they pay more. I have begun to feel that I was wrong about that.

The aforementioned Ms. Cox Richardson passed along these data regarding billionaires in America. “According to Forbes Magazine, the wealth of the richest 25 Americans rose more than $400 billion from 2014 to 2018, giving them a combined wealth of $1.1 trillion. It would take the wealth of 14.3 million ordinary American wage earners to get to that number. During those years, those 25 richest Americans paid $13.6 billion in taxes, a true tax rate of 3.4%.”

There’s a similar picture in Canada. Alex Hemingway, a PhD Economist with the Canadian Centre for Policy Alternatives reported in 2021 that some 47 billionaires in Canada had increased their wealth by $78B in 2020/2021, and that the richest 87 families in Canada control more wealth than the bottom 12 million families combined.

That sounds like an extremely steep wealth distribution profile. But is it harmful? There’s an argument that a rising tide floats all boats. Does it matter if the 87 rich bastards are getting richer as long as the rest of us are too? Well, it seems that all boats aren’t rising any more.

I found that in 2012, Canada was ranked as having the 7^th best living standard in the world. Switzerland was the #1 country in the world. It had a quality of life (QOL) index of 194 and a purchasing power index (PPI) of 127. Canada, at number 7, had a QOL of 165 and a PPI of 111. In 2022, Switzerland is still on top of the world with a QOL index of 195 and a PPI of 118. Canada has slipped to 23^rd in the world with a QOL of 160 and a PPI of 88. 

That is, admittedly, not a lot of research and not a lot of data to go by. You couldn’t use it to argue that the billionaire concentration is causing the decline in standard of living, but it sure argues persuasively that creating a larger and wealthier elite is NOT doing anything to raise the quality of life or purchasing power of the hoi polloi.

So extreme concentration of wealth is not evidently financially beneficial to the country as a whole and may actually be harmful. Are there other reasons to be concerned about the rising inequality and the growth of an elite class?

Yeah, there are. With incredible wealth comes incredible power. 

It is disturbing to see billionaires paying millions to fly into outer space, generating, according to some estimates, more greenhouse gas for an 11 minute flight than an average person generates in a lifetime. It grates on our nerves to find that there are over 7000 “super-yachts” sailing our seas. That blatant ostentatious consumerism seems rather overboard (pun intended). But while disgusting, those things aren’t obviously extremely harmful.

What is extremely harmful is the use of riches to purchase political patronage or advance antisocial goals. Robert Mercer a very successful hedge fund manager, donated $25.5M to Donald Trump’s election campaign in 2016. (That, in itself, marks him in my mind as a dangerous individual.)  CBC News has an article chronicling the dispute between Mercer and David Magerman, a former employee/shareholder who went public with his concerns about Mercer’s anti-social agenda and support for Trump. Magerman has attributed these statements to Mercer:

• “The United States began to go in the wrong direction after the passage of the Civil Rights Act in the 1960s”…. 
• “White people have no racial animus toward African-Americans anymore, and if there is any, it’s not something the government should be concerned with
• and that he “has contempt for the social safety net and he wants to “shrink government to the size of a pinhead.” 

Mercer wrote a piece for the Philadelphia Inquirer in which he said that, during the presidential election, Mercer “was effectively buying shares in the candidate” and “now owns a sizable share of the United States presidency” and that “Mercer has surrounded our president with his people, and his people have an outsized influence over the running of our country simply because Robert Mercer paid for their seats.”

Robert Mercer is not the only billionaire contributing to political war-chests. Trump, Lorne McConnell, Kevin McCarthy and other high profile Republicans are raking in huge sums from billionaires according to a Yahoo! Finance article in April of this year.

• Stephen Schwarzman, CEO of capital investment fund Blackstone Group, more than $20M (all funds in US dollars)
• Ken Griffin, CEO of another hedge fund, Citadel Investments plans $40M in political support.
• Rupert Murdoch (Media tycoon including Fox News) $2M
• Two Home Depot co-founders $2.2M
• Larry Ellison (Oracle Corporation) $15M 
• Mike Lindell, the MyPillow guy, continues to spend. He has spent $25M in 2021 on Trump’s re-election campaign, and continues to push the stolen election big lie.
• Canadian Billionaire Barry Zekelman was recently fined approximately $1M for illegally contributing $1.75 M to a Donald Trump PAC in 2018, thus breaking rules about foreign interference in US elections.

I have written in the past, in my article on Populism, that we ought to clamp down hard on political spending generally, and on high dollar political contributions in particular. Thankfully, Canada already has significant political contribution limits which would make these kinds of donations illegal here. I think it’s very important that we maintain that stance.

Billionaire support for corrupt governments and anti-social goals is not solely an American phenomenon. 

• In Brazil, Jair Bolsinaro, President of Brazil has been accused of forcing high level government employees to kick back a portion of their salaries to him. He has been accused of firing employees who refused to comply with those demands. He is being investigated for irregularities in the over-priced contract for Indian Covaxin Covid-19 vaccines. And yes, this paragon of virtue has a billionaire backer – “far-right, scandal-plagued, evangelical pastor-billionaire, Edir Macedo (universally known as The Bishop and founder of the sprawling Universal Church of the Kingdom of God), who is now an explicit supporter of Bolsonaro.” In addition to his religious sway over his followers, Macedo has a wide-spread media conglomerate in which journalists report his version of events – or else.
• In Turkey, Raycep Erdogan the President of Turkey with a growing reputation for authoritarianism, grew up in poverty. Today he lives in the $1.2B presidential palace in Ankara which he completed with public funds, ignoring a State Council decision to abandon the project. His personal wealth received a significant boost as a result of a donation of a donation of a $25M oil tanker from an Azerbaijani billionaire who wanted citizenship and entry to Turkish commerce.
• In Hungary, Lorinc Mesazaros a childhood friend of President Viktor Orban has become a billionaire with “a flood of government contracts” according to Euractiv. They go on to report that investigative journalists have direct evidence that public money is flowing through the Mesazaros companies back to Viktor Orban.

Not all billionaires are corrupt, of course, and not all cross over to the dark side. The Gates foundation is a leading philanthropic organization. George Soros is actively and publicly embroiled in a battle with Viktor Orban in Hungary and with Donald Trump in America. But there are enough examples of billionaire support for the dark side to make us question the wisdom of having too many billionaires around.

A surprising number of these “deviant” billionaires are described as hedge fund billionaires or financiers. David Magerman, the whistleblower who “outed” Robert Mercer has an interesting theory about the attitudes of the nouveau riche. Because their money was generated rapidly, on the internet, in computer driven enterprises, he theorizes that they have limited understanding of industry, of banking, of conventional finance, and of the real role of government. Mercer’s intention to cripple government power, to minimize the social safety net, and eliminate regulation wherever and whenever he can is a prime example of this lack of respect for establishment structure by the newly vested rich. 

The second attribute of this group is that a number of them (Murdoch in Australia, UK and US, Macedo in Brazil and several others) control media empires. One of the pervasive concerns among conspiracy theorists is that mainstream media is controlled by the dark forces of a world-wide conspiracy and that we cannot trust it. The fact that some really weird people do in fact control a lot of media outlets is concerning. 

And that brings me to Elon Musk. Elon Musk recently purchased Twitter causing great angst among Democrats who are concerned that he is about to return Donald Trump’s megaphone.  Musk made two statements which I believe are worthy of notice.

The first, and less important statement, is that “Free speech is the bedrock of a functioning democracy, and Twitter is the digital town square where matters vital to the future of humanity are debated”. Mr. Musk is right to stand for free speech, but he is wrong to cite Twitter as a forum in which vital matters are debated.

A debate is a structured format in which a proposition is defined and then defended by one side and opposed by another. A debate has rules including “In order to establish an assertion, the team must support it with evidence and logic”. “Facts must be accurate”. “No revision of position is permitted during the debate”. 

Twitter obeys none of those rules, and certainly Donald Trump obeyed none of those rules. Evidence and logic and facts are anathema to Trump and to many of the most vocal in the twitterverse. If Elon Musk transforms Twitter into a wide open platform where anyone can say anything with no filters, no content moderation and no fear of reprisal, then he will have done a serious disservice to free speech and informed debate.

The second statement Musk made on the Twitter purchase was “I don’t care about the economics at all.” That’s the scary statement, the one that should concern us most.

Rich businessmen, and Boards of Directors, and CEO’s of large corporations may make hard-nosed business decisions that disturb us. They may have insufficient caring for the environment, or ignore a significant social impact, but at least they are driven by a logical profit motive we can understand. The good old profit motive imposes a certain amount of constraint on a businessman’s decision making. What will the Board of Directors think? What will stockholders feel? What will happen to my bank account and pension plan?

The scary thing about Musk’s statement is that the ultra-rich elite don’t observe any constraints. They can spend huge fortunes on a whim and not really notice the loss. When a billionaire can spend $50M on a candidate because he thinks that person will advance his racist agenda, or his religious agenda, or it suits his authoritarian bent, that is not beneficial for the society at large.

So yes, let’s stick it to the billionaires. Hit them hard. Tax ‘em to the very limit. I don’t care how – wealth tax, income tax, luxury taxes on yachts and other super-expensive toys. We can use the money to establish the best social programs in the world and maybe pay down the national debt at the same time. We shouldn’t do that to make them pay “their fair share”. To Hell with that – we want them to pay a whole lot more than their fair share. And we want to do that because we want to limit the power and greed and ostentatious arrogance of the developing elite class in Canada. We’re unlikely to be able to get enough from them to stop those who want to support anti-social purposes, but at least we can have them fund the programs that will act as an antidote to hate speech and repression.