Once upon a time, there existed a family who swam so deeply in wealth that their riches exceeded the sum of half of their country’s combined. Once upon a time, that family had the power to control politics; they birthed political machines, manipulated politicians, and exploited the integrity of the government.
Antiquated and feudalistic, the image of such obtrusive characteristics feels like an unwelcome memory of 15th-century monarchies. But what complicates the picture and makes such a description all the more disturbing, is the reality that the enormous wealth and power of Kings and Queens share a modern-day equivalent: 21st-century dynastic wealth.
Today, the Walton family–otherwise known as the heirs of Walmart– has more wealth than the bottom 42% of Americans combined. And they aren’t the only family in such a position.
The Mars family, Koch brothers, and Walton family, cumulatively have 348.7 billion dollars. That is 4 million times the wealth of an average American family. And let’s be clear– that isn’t 348.7 billion dollars they are planning to altruistically share with those in need. That is 348.7 billion dollars which, as history has portrayed, will funnel straight into the hands of each generation within their growing dynasty.
While the notion of families holding quite so much wealth justifies criticisms in its own right, the main issues are twofold: the concretizing of systemic inequality in America and the delegitimization of democracy.
When the top 1% of the world indulges themselves in 48% of global wealth, while the bottom 80% split only 5% of that wealth, there is truly no question that inequality ravages our world. Particularly in the United States, it’s hardly a secret that the extreme wealth of the few develops at the expense of the average individual–and especially the disenfranchised individual.
A critical question, then, regards how this wealth accumulates. The intergenerational accumulation of wealth–or the passing down of large inheritances–is one of the largest contributors to concentrating wealth into the hands of the few. To be precise, a 2017 study finds that “about 60% of private wealth held in the US had been inherited rather than worked for.”
This is heavily problematic because such a figure clarifies how much the situation within which one is born, can define one’s life. In particular, the intergenerational accumulation of wealth breeds long-term and systemic inequality via isolating educational opportunities that are only accessible to the rich. Comprehensive research analyzing the impact of wealth on education finds that the “US wealth gap is fueling an education and upward mobility gap.” This is because “wealth can buy educational achievement through more books, tutors, and private schools. But wealth also offers security that income and financial aid cannot. Young people in high-wealth families can focus on the academic challenges of higher education instead of the financial ones.”
Wealth influence leads to a rigged system of politics. Why? The wealthy have every incentive to manipulate politics to their liking, and because of their ability to pay high prices, they also have every means to do so.
Families that have quite a lot to gain from the political stage frequently pursue their interests via lobbying. Specifically, wealthy families have “lobbied Congress to tip the rules in favor of dynastic wealth, including tax cuts and public policies that will further enrich their enterprises.”
As a bonus to furthering their political agendas, they have found the practice of lobbying to be quite lucrative. According to the Sunlight Foundation, “on average, for every dollar spent on influencing politics, the nation’s most politically active corporations received” That’s a 76,000% return on investment.”
However, the average person certainly doesn’t have the same platform from which they can lobby Congress, make deals with politicians, or influence the average person.
Also problematic: the wealthy’s unequal political influence threatens the foundations of democracy by decreasing active participation in civic forums. Professor Levin-Waldman explains, “Democracy requires a measure of trust between people, and growing income inequality is said to threaten trust as various groups, mainly those at the bottom, experience political alienation and perceive the system not to be fair.”
Looking at this issue logically, when the system feels rigged against you and your voice is given less value than that of others, you’d likely feel discouraged from voting or participating in democracy at all. The effect of this deterrence is demonstrated in figures front the Census Bureau, which indicates that, in 2014 for instance, “up to 75.5 percent of those very lowest-income families didn’t vote.” That means an entire demographic of people go nearly unrepresented.
Thus, the relationship that dynastic wealth allows the wealthy to undermine democracy by a. Giving some people more political influence than others and b. Deterring citizens from being civically engaged.
How can a government be ruled by the people if the intergenerational accumulation of wealth allows the rich to speak over the majority?
Ultimately, the presence of dynastic wealth in America and how the wealthiest families use their power to skew politics runs entirely counter to the democratic ideal of ensuring every voice is heard. Chipping away at an already fragile political landscape, the snowballing of wealth across generations is a true threat to the health of democracy.