Special Report

Back to the 1930s

The Obama left revives the politics of a "low, dishonest decade."

By 11.29.11

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There's an old saying popular among liberals and leftists: "Anti-Semitism is the socialism of the stupid." The aphorism attempts to account for the troubling resemblance of the main propaganda line for socialism -- there is a small, infinitely powerful, infinitely wealthy cabal at the center of society that controls the entire economy -- with the other propaganda line that there is a small, infinitely powerful, infinitely wealthy, Jewish cabal at the center of society controlling everything. According to this flippant dismissal, only a stupid person would distort the shining truths of socialism by muddying them with theories about race or religion.

Somehow it never occurs to liberals that the equation also runs the other way. Socialism is the anti-Semitism of the intelligentsia.

The political dialogue of the "1 percent versus the 99 percent" that currently consumes the liberal press is beginning to take the aura of the 1930s. That was the era, of course, when the world was divided into the "plutocrats" and "the masses," when the Monopoly board's depiction of "the rich" as a portly, tuxedo-and-top-hat-wearing breed apart was perceived as social reality. It was the 1930s, after all, that gave us Daddy Warbucks, that billionaire-who-could-do-anything, who was, let us not forget, a friend of President Franklin Roosevelt.

So why anyone would want to revive the politics of a "low, dishonest decade," as W.H. Auden described it, that led directly to the outbreak of World War II? It seems beyond comprehension. Nevertheless, thanks to the distorted scholarship of liberal scholars and the New--Dealification of the economy under President Barack Obama, here we are back in 1935.

The Occupy Wall Street crowd, as anyone who has studied 1930s history can see, is only one or two steps away from becoming the Brown Shirts of our era. The run-up to World War II was fought in the precincts of Berlin and other European capitals by political gangs that had abandoned electoral politics and decided to win their case "into the streets." By comparison, the Occupy-Whatever movement has so far been relatively benign. There is the usual agitprop of trying to provoke the police into overreaction so that the aggressors can celebrate themselves as "victims of the establishment who have unmasked the iron fist of the establishment," etc. etc. (Why is it that every movement that starts out denouncing billionaires ends up fighting $35,000-a-year cops from Queens?)

In any case, the Occupiers' form of extra-political violence isn't likely to reach true 1930s levels until it abandons the relative safety of urban parks and college campuses and goes out to Iowa, where they are promising to "Occupy the Iowa Republican Caucuses." At that point things are likely to get nasty. While the relatively tame urban police forces have learned their lessons from the 1960s on how to deal with protesters, inexperienced folks out in the Midwest are not likely to be as tolerant of political thuggery.

So how did we get to a point most sensible historians had assumed we left 80 years behind us? There are two answers: President Obama's politics and liberal scholarship.

The Occupiers have the germ of a case -- just as did the inhabitants of Hoovervilles and the Bonus Army that descended on Washington in 1932. (They had written promises of bonuses for their service during World War I that Congress had failed to honor.) The economy stinks. There are few jobs to be had. Yet except for James Taranto in the Wall Street Journal, no news commentators have yet used the term "Obamaville" to describe the tent cities that have popped up around the country. Our President has managed to fashion the worst economy since the 1930s -- one that may soon eclipse the 1930s if Europe follows the present trend and goes under. Yet his only response has been to cartelize the economy in the manner of Franklin Roosevelt and then follow by emulating the worst demagogues of that era. Try this for example:

According to the tables which we have assembled, it is our estimate that 4 percent of the American people own 85 percent of the wealth of America and that over 70 of the American people don't own enough to pay the debts they owe. How many men ever went to a barbecue and would let one man take off the table what's intended for 9/10ths of the people to eat. The only way you'll ever be able to feed the balance of the people is to make that man come back and bring back some of the grub he ain't got no business with.

Is this Obama addressing a group of dewy-eyed freshmen in Colorado? No, it is Senator Huey Long of Louisiana, "The Kingfish," delivering his "Share the Wealth" address to an assembly of Congressional staffers in the Capitol Building in 1935. The Hill staffers applauded rapturously as Long went on to propose stripping John D. Rockefeller, Bernard Baruch, J.P. Morgan, Andrew Mellon, and the rest of the millionaires of all their wealth and redistributing it to the American people:

We say to America 125 million, none shall be too big, none shall be too poor… but… that America will become a land, sharing the fruits of the land, not for the favored few, not to satisfy greed but that all may live in the land in which the Lord has provided an abundance sufficient for the luxury and convenience of the people in general.

All that's missing is Obama's customary invocation of "folks."

But it isn't just the President's channeling of the demagogues of the 1930s that has created the poisonous mood. Liberal scholars have labored long and hard to bring about this moment. Two of the most noteworthy are Thomas Piketty and Emmanuel Saez, a pair of French Marxists who parachuted into Berkeley in the 1990s and without ever bothering to check out the neighborhood started dissecting income tax records trying to prove that America has as much inequality as France in the days of Louis XVI. All this has since been fought out in the academic journals, with Alan Reynolds standing toe-to-toe with Piketty and Saez, critiquing their work every step of the way. Suffice to say that P&S are the main source of the "1 percent" argument that has become the touchstone of Democratic politics.

Here's how P&S arrived at their conclusions:

1. First, they looked at individual tax returns, rather than households or families. Individual returns reflect every teenager who earned $3,000 at a summer job. Not taking account that people share income and support each other naturally skews things toward the lower end.

2. P&S took no account of government transfers, which now make up a huge portion of the income of poorer households. Welfare payments, SSI, food stamps, housing vouchers and Medicaid -- all are non-taxable and constitute a major source of income to most poor families.

3. A vast number of "the rich" who show up at the top end of the income scale are Subchapter S corporations, not individuals. The 1986 tax reform raised corporate taxes to 36 percent while lowering personal rates to 28 to 35 percent. This set off a stampede out of Schedule C corporate filings and into Subchapter S, where a corporation's earning can be shared by up to 100 individuals. Almost half the corporations in America now file "personal" income taxes. Banks making $10 million in revenues now file under Subchapter S. This makes it appear as if there are fabulously rich individuals roaming the land when in fact they are small and mid-sized corporations. By failing to take this into account, P&S decided there has been a huge and growing "inequality gap" since 1986.

All this is lost in the shuffle, however, as the campaign to scapegoat the "1 percent" becomes an obsession of the liberal obsession. The New York Times now runs a front-page story almost every day highlighting the comparison between "the 1 percent and the other 99." The one before Thanksgiving featured a lament of how the 99 percent must camp out in front of Targets and Wal-Mart "racing for bargains at ever-earlier hours while the rich mostly will not be bothering to leave home." Three days before that it was how "the gap between first class and coach" on international flights "has never been so wide."

Carriers… are offering private suites for first-class passengers, three-star meals and personal service once found only on corporate jets. They provide massages before takeoff, whisk passengers through special customs lanes and drive them in a private limousine right to the plane. Some have bars. One airline has installed showers onboard.

The amenities in the back of the cabin? Sparse.

That these luxury passengers are paying $15,000 a seat and provide more than half the revenues from each flight did not seem to make much difference.

Finally last Sunday the Times found an éminence grise in former Republican mayoral candidate Ron Lauder, who spearheaded the campaign to impose term limits on New York City politicians. Pictured in front if a $135 million painting in light that made him look like a German baron who supported the Nazis in 1933, Lauder was stigmatized as a manipulator "now worth $3.1 billion" who is making "shrewd use of the tax code [to achieve] deductions worth tens of millions of dollars in federal income taxes." Lauder's sin is that he has donated paintings from his personal collection to establish the Neue Galerie of Austrian and German art in Manhattan. When the New York Times starts pillorying art galleries, you know you're in a new era.

Still, all this hasn't been enough for Paul Krugman, the only certifiable lunatic ever to win a Nobel Prize. Last Friday Krugman informed readers that aiming at the 1 percent is all wrong. They should be raising their sites:

If anything… the 99 percent slogan aims too low. A large fraction of the top 1 percent's gains have actually gone to an even smaller group, the top 0.1 percent -- the richest one-thousandth of the population.

Dismissing the objection that the .01 percent might include some "job creators" (Times style is now to put ironic quotation marks around "job creators"), Krugman goads his followers to action:

So should the 99.9 percent hate the 0.1 percent? No, not at all. But they should ignore all the propaganda about "job creators" and demand that the super-elite pay substantially more in taxes.

Seriously, what's the point of singling out the "0.1 percent" if not to hate them? But let's go Krugman one better. I'll bet it's not just the 0.1 percent or the 0.01 percent or the 0.0001 percent that's responsible for this country's ailing economy. I'll be there's one individual behind it all, one sinister billionaire who is manipulating the system, thwarting poor old President Obama efforts to bring prosperity to the people. I'll bet we even know his name. It's Goldstein, Emmanuel Goldstein.

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Green Lantern is the pen-name of an East Coast writer.