The notion of taxing America’s fabulously wealthy, big-time, has gone mainstream. Lawmakers and commentators alike have spent all this past week earnestly — and highly visibly — thrashing out exactly how best to make our nation’s richest “pay their fair share.”
Our nation’s capital hasn’t seen such a concentration on taxing concentrated wealth since Franklin Roosevelt proposed a 100 percent tax on income over $400,000, in today’s dollars, back in 1942.
FDR’s proposal eventually led to two decades of high taxes on high incomes, with top tax-bracket rates hovering around 90 percent. FDR’s bold tax-the-rich bid also sped the emergence, in the United States, of the world’s first-ever mass middle class.
We don’t quite know yet how the current spotlight on taxing America’s wealthiest is going to turn out. But just getting to this point, getting serious tax-the-rich proposals right on America’s political center stage, counts as a significant step into a more just and equal future. And who deserves the credit for this significant step? Some just-released research suggests that a healthy share of that credit ought to be going to the activists who gave us, a decade ago, Occupy Wall Street.
In 2011, with the Great Recession fading ever so slowly, these activists occupied a Wall Street park and captured imaginations almost everywhere, inspiring tax-the-rich occupations across the United States and far beyond our borders. With their signature slogan — “We Are the 99 Percent” — the Occupy activists exposed the disgusting enormity of the wealth at our economic summit. They turned the “1 percent” into a catchphrase that helped millions of Americans better understand who we need to challenge to fix what ails our deeply unequal and unjust status quo.
This Occupy contribution to our political discourse mattered more than any of us who occupied and supported the occupiers realized at the time. So posit researchers from Ohio State and Cornell universities who earlier this month published in the Proceedings of the National Academy of Sciences the results from a series of fascinating psychological experiments.
The experiments, eight in all, involved some 2,800 participants. The core finding: The more the public sees the ultra rich through a lens that treats these rich as isolated individuals, the more comfortable the public tends to be with enormous concentrations of wealth.
The more we see our individual wealthy as part of a hefty wealthy cohort, by contrast, the more eager we become to take on the inequities that generate grand private fortunes.
Thinking about the 1 percent, explains Cornell psychologist Thomas Gilovich, encourages us to think about the unfair advantages the rich enjoy and the political and economic games they play to maintain their privileged status. We become, as a result, “much more willing to support” measures that target “growing income inequality.”
The most imaginative of the eight Ohio State and Cornell experiments began by giving over 200 study participants detailed information about corporate CEO compensation. Half the group received information revealing that CEO pay at 350 major U.S. corporations has soared from 48 times average worker pay in 1995 to 372 times today.
The other half of the study group received background info only about a single CEO whose pay had jumped at that same rate.
How did the respondents react? Those in the first study felt the 350 CEOs averaging 372 times worker pay were taking home far too much compensation. Those who learned only about the one single CEO seemed to have concluded that he must be an individual of spectacular talent. They ended up feeling his earnings ought to run even higher!
Spotlighting the wealth of successful individuals, the Ohio State-Cornell research concludes, “may reduce support for redistribution because people are more likely to believe that the wealth of individuals, rather than groups, at the top is well earned.”
The reverse plays out when people focus on the wealthy as a group, points out study lead author Jesse Walker, an Ohio State marketing expert. People who see the wealthy in group terms will be more likely to attribute grand fortune to luck and an economic system rigged to favor the wealthy.
The new research from Ohio State and Cornell makes for powerful reading, but, at root, the researchers haven’t really told us anything we haven’t known for over a century. Or, to be more precise, the research doesn’t tell us anything that public relations people haven’t known for over a century, ever since the founder of the science of public relations, Ivy Lee, turned the plutocrat that Gilded Age Americans most despised into a kindly old man that millions of Americans admired.
Lee’s client, John D. Rockefeller, happened to be the world’s richest man. By 1914, Americans had come to see old John D., notes Museum of Public Relations co-founder Shelley Spector, as “a very selfish, monopolistic tyrant who cared little for the masses.”
That year’s Ludlow Massacre only reinforced Rockefeller’s negative image. The year before, Rockefeller’s Colorado Fuel and Iron company had locked some 9,000 striking miners out of their jobs and housing. The jobless — and homeless — miners went on to spend the winter in tent camps, still demanding better working conditions and pay. In April 1914, Colorado militiamen, company guards, and assorted thuggish strikebreakers attacked the camp, setting fire to the tents. The dead included four women and eleven children.
Enter Ivy Lee, a Princetonian who had built a lucrative career flacking for coal companies. Lee realized, relates PR historian Spector, that he needed to get the public “to see Rockefeller as a human being and learn about the good works he made possible.” Lee proceeded to convince Rockefeller to let newsreel photographers onto his private estates. Soon audiences the nation over were watching Rockefeller “playing croquet, hugging his grandchildren, even giving away dimes to indigent kids.” Rockefeller the ruthless slowly morphed into Rockefeller the sweet philanthropist.
Before Occupy Wall Street, today’s billionaires — with their armies of modern-day flacks — were by and large getting away with the same tricks that Ivy Lee pioneered. They turned their billionaires into celebrities, with profiles cycling endlessly in mass-circulation media outlets. These billionaires bestrode the early 21st century as super-talents, geniuses making the world better for everybody.
But Occupy began the reframing of our deeply unequal economic reality, and, in the years since Occupy, activist groups have kept the spotlight on billionaires — and the rest of our super rich — as a group. That advocacy has made a difference. A “growing share of U.S. adults,” Pew Research Center polling indicated this past summer, now see billionaire fortunes as “a bad thing for the country,” with younger people — those Americans most involved with Occupy — “considerably more likely than older adults” to view billionaires in negative terms.
Even so, most Americans — 55 percent — still do see billionaire wealth as neither good nor bad. And that shouldn’t surprise us because today’s Ivy Lees are still working as hard as ever to get us to view their billionaire clients as talents who deserve our eternal gratitude. One example: Elon Musk, the self-absorbed automaker ever willing to gamble with the health of his workers, enjoys acclaim as an oddball but lovable visionary genius.
The work of Occupy, in short, remains unfinished.
“If you want to change the system,” sums up Cornell’s Gilovich, “you’ve got to make people think in systemic terms.”
We’re gaining on that goal. We still have so much further, this week reminds us, to go.
Sam Pizzigati co-edits Inequality.org. His latest books include The Case for a Maximum Wage and The Rich Don’t Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class, 1900-1970. Follow him at @Too_Much_Online.