Separate and Unequal: Chuck Collins on How Wealth Divides Us

Chuck Collins may seem an unlikely activist. Born into the wealthiest 1 percent, he has dedicated himself to helping relieve the suffering of those at the very bottom of the 99 percent. He was raised in an affluent suburb of Detroit and attended elite private schools. He played tennis at country clubs and took trips to exotic destinations. He had a loving family, and his great-grandfather was Oscar Mayer, a German immigrant who cofounded the hot-dog empire. When Collins was sixteen, his father informed him that he was going to inherit part of the Mayer-family fortune as a trust fund. Collins’s reaction was complicated: he was relieved he’d have enough money to pay for college, but it also felt unfair.

Collins had first become aware of inequality in 1967, when Detroit’s black residents rioted against police brutality and racial injustice. He was transfixed by the violent images on TV and in the newspaper: buildings burning, armored tanks in the streets, and people dying just twenty miles from his home. It was obvious to the seven-year-old that other people’s lives were very different from his. He told his mother it wasn’t right. She agreed.

This youthful sense of right and wrong stayed with him, influenced by his parents’ Christian faith, with its emphasis on helping those less fortunate. After high school, unlike all of his classmates, he skipped college. Instead he went to live in working-class Worcester, Massachusetts, where he volunteered in a soup kitchen and became an organizer for public-housing tenants. As he continued to work in disadvantaged communities, he was struck by the generosity he often witnessed. People came together and shared their burdens in a way he hadn’t experienced in his own life. It hit him that he’d been “disconnected from a really important part of what it means to be human.”

Collins did eventually draw from that trust fund to go to college, but by the time he was twenty-six, he’d seen enough to decide that his inheritance wasn’t helping him — and it could be helping others. So he made the momentous decision to give it away — half a million dollars — to social-justice organizations. As he explained to his parents, he wanted to “pass the wealth on.” His father was concerned: What if something terrible happened, like an illness or an accident? Would he rely on our “terrible” social safety net? Yes, Collins replied, and now he’d have a stake in improving the system. As fate would have it, just a few months later the house Collins was living in caught on fire, and everything he owned was destroyed. But when a dozen of his new friends came over to give him food and help clean up, he knew he’d be OK.

Of course rejecting his financial legacy didn’t erase all of Collins’s advantages in life. He says much of privilege is “hardwired” and doesn’t depend on what you have in the bank. Privilege is about multigenerational access to good schools and doctors, healthy environments and social connections. And if you’re white, you’ve benefited from a long, often unacknowledged history of government subsidies. “I don’t hate the 1 percent,” Collins says, “but I deeply hate the ways extreme inequality wounds people’s lives, fuels racial divisions, rips our communities apart, and destroys our ecological home.” Though he understands why people are angry at the super-wealthy, he believes that a movement for real change needs to be built on empathy. He insists that, whether rich or poor, “we are all dependent and interdependent.”

Collins is a senior scholar at the Institute for Policy Studies, a progressive think tank where he directs the program on Inequality and the Common Good. He also coedits the website inequality.org. He lives with his daughter, his partner, and his partner’s children in Jamaica Plain, Massachusetts, where he works to support the local economy. His many books include Wealth and Our Commonwealth: Why America Should Tax Accumulated Fortunes (with Bill Gates Sr.); Economic Apartheid in America: A Primer on Economic Inequality & Insecurity (with Felice Yeskel); and his latest, Born on Third Base: A One Percenter Makes the Case for Tackling Inequality, Bringing Wealth Home, and Committing to the Common Good. Collins also cowrote, with Mary Wright, The Moral Measure of the Economy, which explores the economy through Catholic social teachings.

Collins spent five hours talking with me by phone for this interview. He is warm, funny, and passionate about dismantling economic inequality. He told me that he often feels overwhelmed by what’s going on in the world. But then he gets back to work, raising awareness of the monolithic, rigged system that is undermining our democracy.

Wildhood: Why should we be concerned about inequality? How does it hurt me for someone else to make a hundred or even a thousand times as much money as I do?

Collins: Extreme inequality of wealth, income, and opportunity is warping everything we care about. It takes away the sense that we’re all in the same boat. It screws up communities. You can see it in the housing market, where wealthy buyers bid up prices, making homes unaffordable for everyone else. It creates economic volatility even for the rich, which is one reason why the wealthy cling to their wealth. We live in a society where even people who don’t appear to be at risk can lose it all, and the fear of that happening makes them greedy and shortsighted.

Inequality rips communities apart. U.S. Census data show that, over the last four decades, high- and low-income families have become increasingly unlikely to live near one another. Mixed-income neighborhoods are becoming rarer. As we divide into affluent and poor enclaves, people’s sense that they share a common destiny withers, replaced by fear, misunderstanding, and class and racial antagonisms. Public investments in health infrastructure and social opportunity often decline.

Political scientists are finding that too much inequality is bad for democracy. It disenfranchises voters and warps lawmakers’ priorities. A polarized economy creates polarized politics, which makes it hard to get any movement on climate change, infrastructure repair, healthcare, and an already weakened social safety net. Legislation that helps the rich almost always passes, whereas bills that help everyone else have a hard time getting political attention.

During the first six months of the 2016 presidential campaign, almost half the money contributed to candidates, both Republican and Democrat, came from just 158 donors. Former president Jimmy Carter has said that our political system is now an oligarchy — a government controlled by a wealthy few.

Economic historians view inequality as a precondition for major economic upheavals and downturns, such as the Great Depression of 1929 and the Great Recession of 2008. The imbalance of wealth creates ripples throughout our society.

Wildhood: Isn’t some wealth imbalance inherent in a capitalist system?

Collins: I would argue that, if you care about healthy, free-market capitalism, you should be alarmed about extreme inequality. For one, it creates monopolies, which block competition and opportunities for smaller businesses. As I just said, it creates volatility — booms and busts. And it creates a class of citizens who are barely able to participate in the economy. Low- and middle-income people have less spending power and are working longer hours, going into debt, and sending more people in their household into the workforce just to survive. At the other end of the spectrum, the rich are investing more and more in the speculative financial economy, which doesn’t create any job growth. So you get more and more speculative bubbles.

Private citizens hold about $85 trillion of wealth in this country. A recent Federal Reserve report says that the top 1 percent have 38 percent of this — more than $30 trillion. When you have that kind of money, there’s a huge temptation to take a chunk of it and try to get a high return, especially when your financial advisors are saying, Come over here and make 20 percent on your capital instead of that boring old 4 percent. That’s what got us into trouble ten years ago.

The wealthiest three people — Jeff Bezos, Warren Buffett, and Bill Gates — have as much as the bottom 50 percent. The bottom 20 percent have negative net worth, meaning they owe more than they own and have nothing to fall back on. Nearly 45 percent of American households don’t have access to a thousand dollars in case of an emergency. It’s disproportionately people living in rural areas, women, people without a college degree, and renters who are in this position, but even those who appear to be solidly in the middle class often don’t have enough in savings to tide them over for three months without income. The most common source of savings depletion is medical costs, both through expenses and lost wages. Conservatives point the finger at individuals and blame them for poor planning, but that ignores four decades of wage stagnation and lack of affordable healthcare.

Meanwhile the Trump administration pushes for tax cuts for the wealthy and global corporations and wants to leave millions of Americans with no health insurance. We’re going to see continued tax avoidance by the super-wealthy under Trump, who wants to greatly reduce taxes on corporations and deregulate the financial markets. Regardless of what Trump does, I think the offshore-banking system will keep growing.

Wildhood: And the Republican-led Congress seems unlikely to rein in the president.

Collins: They are just as bad. In 2017 Congress rejected a proposed Obama-era regulation that required Internet-service providers to get explicit permission from customers before sharing their browsing history with other companies. This means that AT&T, Comcast, and other providers can sell your search history — which is automatically recorded whether or not you delete it on your web browser — to the highest bidder without your permission. Who is that legislation for but corporations? This is a no-shame Congress. No citizen voted for Verizon or Comcast to use our personal information for profit. We have to make sure those who supported this legislation pay a cost. It’s an all-hands-on-deck moment. And people are rising to the challenge.

For example, in Montana a group of women, galvanized by a picture of a dead Syrian-refugee child, got a resettlement agency to come to their state, which has historically been unfriendly to refugees. Now they have a nonprofit in Missoula called Soft Landing, which provides services like driver’s education and English-language classes to refugee families. It also educates the Missoula community about the refugee crisis and how to extend welcome to all. This organization, which has more than six hundred volunteers, was started by a woman who had no background in activism or politics.

We’re seeing a revival of the religious sanctuary movement, which in the 1980s provided safe haven for Central Americans fleeing civil conflicts in their home countries. The revival started in response to President Obama’s aggressive deportation policies, but the current administration’s rhetoric has caused the movement to balloon. Within a month of Trump’s inauguration, the Church World Service counted more than eight hundred congregations providing assistance for those threatened with deportation, as well as accompanying immigrants through their deportation process and advocating for more-humane deportation procedures. That’s double the number there were before Trump was elected.

Read the entire interview at The Sun Magazine. 

Chuck Collins directs the Program on Inequality at the Institute for Policy Studies. He is co-editor of Inequality.org and the author of Born on Third Base: A One Percenter Makes the Case for Tackling Inequality, Bringing Wealth Home, and Committing to the Common Good.