A weekly newsletter from the Institute for Policy Studies
U.S. billionaires set a new record last year. They collectively spent a jaw-dropping $1 billion on the 2022 midterm elections, according to new research from our friends at Americans for Tax Fairness.
That total represents a 72 percent increase over the 2018 midterms and a 3,000 percent increase since the midterms in 2010, just before the Supreme Court’s Citizens United decision opened the floodgates for big money in politics. How big is the money? Just 15 billionaires generated almost two-thirds of all billionaire contributions to 2022 midterm campaigns.
All those dollars our nation’s wealthy are funneling into our elections are just a drop in the bucket compared to the return on investment they expect from the elected officials they financially support. And they’re getting that return. Florida Governor Ron DeSantis, for example, has pocketed “extraordinary” billionaire backing. He has, in return, rubber-stamped a juicy pro-corporate agenda.
We’re now seeing first-hand what happens when lawmakers let billionaires get away with paying taxes at a lower effective rate than average working people. Billionaires are, in effect, parlaying their untaxed wealth gains into legislation that attacks our nation’s most vulnerable. More on the corrupting influence of grand fortunes — and what we can do about them — in this week’s issue.
Chuck Collins and Rebekah Entralgo,
for the Institute for Policy Studies' Inequality.org team
INEQUALITY BY THE NUMBERS
Teachers Are Standing Up to Anti-Union, Billionaire-Friendly Lawmakers
Last week, Florida Governor Ron DeSantis appeared at a Miami charter school to sign into law a slate of education bills. One of these bills, cynically marketed by DeSantis as “paycheck protection,” eliminates the ability of public sector unions to collect dues via payroll deduction. Another, a “school choice” bill, expands the state’s charter school voucher program, a move that will let parents opt out of public schools and send their children to private schools on the state dime.
This legislation, United Teachers of Dade President Karla Hernandez-Mats tells Inequality.org, will only exacerbate the state’s ongoing teacher shortage crisis and accelerate the larger right-wing agenda to defund public education.
“This will hurt working people and the middle class,” Hernández-Mats explains. “This is about going after our freedom, about going after workers and their right to a fair contract.”
Our managing editor Rebekah Entralgo has more on the new Florida legislation and what teachers are doing to fight back.
Regulate Donor-Advised Funds to Secure the Supreme Court
Journalists, it seems, just can’t stop unearthing shocking details of how shadowy influence campaigns have fashioned our Supreme Court’s conservative majority. Ultra-wealthy judicial activists exploit the law's current weaknesses to covertly channel their money into politics: Leonard Leo, for example, relies on a perfectly legal design flaw in our philanthropic sector.
Tax filings from last year indicate that Schwab Charitable, a major donor-advised fund sponsor, contributed $141.5 million to the 85 Fund, a key charitable component of Leo’s court-packing project. Donor-advised funds, our Dan Petegorsky explains, can conceal donor identities and feign a broader berth of support, helping nonprofits retain their public charity status.
Leo’s antics distill why we need to reform how charity operates. Check out Petegorsky’s take at the link below.
To Protect Our Children, Let’s Seriously Tax Our Rich
America’s social studies textbooks urgently need an update — on child labor. Those textbooks, ever since the mid-20th century, have applauded the reforms that ended the child-labor horrors that ran widespread throughout the nation’s early Industrial Age. Now those horrors are reappearing.
Jobs for the youngest among us, claim cheerleaders for erasing protections for kids, build character. Over a century ago, amid the initial push against child labor, no American did more to protect kids from sophistry like that than the philosopher Felix Adler. The nation, Adler deeply believed, must limit the incentives that drive employers to exploit kids — by refusing to let the rich keep as much as they could grab. Inequality.org’s Sam Pizzigati has more.
PETULANT PLUTOCRAT OF THE WEEK
Scientists Say ‘No More’ to CEO’s Academic Profiteering
This week’s dour deep pocket: Erik Engstrom, CEO of RELX, the parent company of Elsevier, the world’s largest publisher of scientific journals.
What has him sour: Engstrom, Elsevier’s CEO before moving up the RELX corporate ladder, has helped turn scientific publishing into a global empire “far more profitable” than either the film or record industries, businesses that take in comparable annual revenues. Elsevier profits have hovered near a remarkable annual 40 percent, and Engstrom, earlier this year, crowed about his company’s “strong cash flow and financial position.” But scientists have begun fighting back against Elsevier’s in-your-face profiteering. Last month, over 40 academics resigned as editors of two Elsevier journals after the company refused to drop the fee that scientists must pay to get their articles published.
The last word: The neurologists who resigned from their Elsevier editorial roles are launching a nonprofit open-access journal because, as Cardiff University’s Chris Chambers notes, “Elsevier preys on the academic community, claiming huge profits while adding little value to science.”
This week on Inequality.org
Omar Ocampo, The Ultra-Wealthy Have a Private Jet Problem. This expensive, carbon-intensive form of travel undercuts the health of our Earth and has average-income taxpayers subsidizing the ultra-rich.
Tom Malleson, Why We Should Abolish the Super Rich. The rationales for accepting vast inequalities of income and wealth simply do not hold up.
Elsewhere on the Web
Naomi Klein, AI machines aren’t ‘hallucinating.’ But their makers are, Guardian. We are watching CEOs of the wealthiest companies in history unilaterally seizing the sum total of human knowledge and walling it off inside proprietary products that take direct aim at the humans whose lifetime of labor trained the machines.
Judd Legum, Ron DeSantis is about to make a mockery of campaign finance law, Popular Information. Candidates for federal office cannot by law raise money directly from corporations or accept individual contributions in excess of $6,600. DeSantis is working an $86-million loophole for his super-rich benefactors.
Eliza Shapiro, If You Double-Park and You’re Rich, Should You Pay a Higher Fine? New York Times. Yes, says a new bill before the New York City Council.
Michael Marinetto, Why are social scientists so uninterested in the super-rich? Times Higher Education. Disparities of wealth are becoming ever more extreme, yet researchers continue to focus their attention much more on only the poor.
Sonali Kolhatkar, The Real Reason Disney Is Defying DeSantis, Pressenza. Corporations have bottom lines, not morals. Disney’s lawsuit against Florida boils down more to reaping profits while underpaying workers than protecting LGBTQ communities.
Emma Platoff and Matt Stout, Overshadowed by rent control debate, proposals for transfer taxes pick up steam in housing discussions, Boston Globe. In Massachusetts, momentum is building for subjecting mansion sales to special new transfer fees, with the proceeds going to build affordable housing.
Connor Gibson, Koch Spending to Influence Policy and Politics Eclipses Charitable Giving, Center for Media and Democracy. Only 6 percent of the giving from Koch empire groups supports genuine charitable causes that do not explicitly align with Charles Koch’s own economic interests or ideological policy goals.
Arwa Mahdawi, It’s official: billionaires aren’t the brainboxes they like to believe, Guardian. The obscene wealth of many CEOs comes less from intelligence and more from luck, background, and personality.
Jim Wallis, Matthew Desmond on America's "Sinful" Treatment of Poor People, The Soul of the Nation. Desmond explains why the United States has more poverty than any other advanced democracy. He calls the Republican plan to reduce federal spending by cutting poverty programs "sinful and shameful" and offers five ways we can all become “poverty abolitionists.”
The average wealth of the richest 400 Americans ended up lower in 2022 than in 2021. But don’t break out the hankies. At more than $10 billion, the average net worth of our super rich still ran higher than in any other year over the past four decades. We have an interactive version of this chart — and more wealth inequality data charts — at the link below.
Inequality.org | www.inequality.org | firstname.lastname@example.org
Managing Editor: Rebekah Entralgo
Co-Editors: Sarah Anderson, Chuck Collins, Sam Pizzigati, and Isabella DeVaan
Production: Isabella DeVaan