RUSH: There’s a story by Chrystia Freeland, who is the editor of Thomson Reuters Digital. She has a story in the Atlantic.com magazine: “The 14 Biggest Ideas of the Year,” and I want to focus on what she says here is number three:
“The Rich Are Different From You and Me,” as F. Scott Fitzgerald said in The Great Gatsby. “The rich are always with us, as we learned from the Bette Davis film of that name, released in the teeth of the Great Depression. The most memorable part of that movie was its title — but that terrific phrase turns out not to be entirely true. In every society, some people are richer than others, but across time and geography, the gap between the rich and the rest has varied widely. The reality today is that the rich — especially the very, very rich — are vaulting ahead of everyone else. Between 2002 and 2007, 65 percent of all income growth in the US went to the richest 1 percent of the population.”
Do you still have that sniveling caller who was upset? Did you put him up? Good. Her? Okay, fine.
“Between 2002 and 2007, 65 percent of all income growth in the US went to the richest 1 percent of the population,” like Nancy Pelosi, by the way, we might add. Pelosi’s wealth during the recession has ballooned 62%. This is one thing they never tell you when they do all these stories about the widening gap between the rich and the poor: Who the hell are the rich? Nancy Pelosi and her husband, Paul, their net worth vaulted 62% during the recession. Nancy Pelosi, this caring, big-hearted, compassionate liberal. You never hear about it. “The rise of today’s super-rich,” writes Chrystia Freeland, “is a global phenomenon. It is particularly marked in the United States, but it is also happening in other developed economies like the United Kingdom and Canada.
“Income inequality is also increasing in most of the go-go emerging-market economies, and is now as high in Communist China as it is in the US,” income inequality. Well, take note, because the ChiComs at the end of the day are still a bunch of communists. I don’t know if you liberal-loving socialists out there realize even during the heyday of the Soviet Union, the elites still stole all the money. There was no redistribution of wealth. Go to Cuba. How’s everybody faring down there? All of you people think that it’s a wonderful thing for government to redistribute wealth so everybody does well at the end? It never works, because people end up at the top taking all the money for themselves. Read the book “Reckless Endangerment.”
Jim Johnson, James Johnson, the guy at Fannie Mae, siphoned two to three billion dollars of federal money to Fannie Mae for himself and people in the executive suite to pay themselves, and how many of the richest 1% were exactly the same richest 1% year to year, decade to decade? It always changes. People fall in and out of that group. “These global super-rich work and play together,” she writes. “They jet between the Four Seasons in Shanghai and the Four Seasons in New York to do business.” Wait. Chrystia, I hate to tell you but the super rich you’re talking about are not saying in hotels. The super, super-rich you’re talking about don’t stay in hotels. Well, in Davos they may stay in a hotel when they have Herbie Allen’s media seminar or something, they may stay at hotels.
They own houses where the super-rich run around and play or they stay on their yachts. I’m talking about the really — the very, very — rich, as she describes it here. The very, very rich are not hanging around hotels. They go to St. Bart’s and they stay on Paul Allen’s yacht, or Jay-Z Maybach. I don’t know where they go, but not hotels. They may hang around the hotel now and then, but that’s not… How do I know? Well… (laughing) Don’t doubt me. “Many are global nomads with a fistful of passports and several far-flung homes. They have more in common with one another than with the folks in the hinterland back home, and increasingly, they are forming a nation unto themselves.”
Hey, Christa? It’s true of every group. The Hollywood left is far more comfortable with each other. Hey, Cameron Diaz? Who’s she dating? A-Rod, not some gasoline station owner. Hey, people hang out in the same circles. (interruption) Don’t tell me, they broke up? Oh, no! Ohhh, no! (interruption) A-Rod and Cameron Diaz are no more? Oh. I gotta take a break, and I gotta recover, ’cause this woman Chrystia Freeland, at the end of this piece, she stumbles into something. I’m sure she doesn’t even realize how it undercuts the entire impression she’s trying to make about these very rich people.
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RUSH: In North Korea the richest 1% are the people who run the government, but there’s no great equality in that country. The rest of the people eat dog. I’m not kidding. How much more money would be available for other people to get rich if the government didn’t take so much of it? Before the government can redistribute, it has to take it from people, and who are they to decide anyway? Who are they to decide what’s fair? Who is the government to decide who ends up with what? They aren’t. As a matter of fact, folks, how many more people would have jobs and homes if the government didn’t take so much money from everybody? You know, somebody who is rich is not hurting somebody who’s poor or middle class or what have you.
A rich person is not hurting anybody. You take all the money away from the rich, where do the people who work for them go? What happens to them? Somebody who’s rich is not hurting anybody who’s poor or middle class, but some politician, government bureaucrat, can destroy your job. Somebody in government can destroy your profession, regulate your profession out of existence. Somebody in government can take your assets, can drive up your costs and prices, do more harm to you than any other person or people. And we look at them as the great equalizers?
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RUSH: The piece by Chrystia Freeland, TheAtlantic.com: “The Rich Are Different From You and Me.” Here she talks about the growing gap between the very, very rich and the rest of us, tries to say that the reason the gap exists is ’cause the very, very rich are stealing from everybody. I’ve never understood the math on that, by the way, that the rich get rich by stealing from the poor. The mathematics of that’s never made sense to me. But here, on the second page of her piece I don’t think she understands how this undercuts her whole piece. Listen to this.
“Many of today’s super-rich started out in the middle and make most of their money through work, not inheritance,” and yet we are still gonna hate them. “Ninety-five years ago, the richest 1 percent of Americans received only 20 percent of their income from paid work; in 2004, that income proportion had tripled, to 60 percent.” So this is the old money versus new money. And the old money, Kennedy money, arrogant, stodgy, nose in the air, looking down on people who earn their money from work, and that still exists, by the way. The arrogant blue-blood money from the golden years, from the railroad days, the Vanderbilts, all that, whatever’s left of that money, those people, they still have it, and they start sipping cocktails at four o’clock in the afternoon, they don’t even know we’re at war in Iraq or Afghanistan but they look down their nose at everybody else, particularly those who work, working classes.
And 95 years ago the richest 1% of Americans received only 20% of their income from paid work. The vast majority of the rich were inherited. In 2004, seven years ago, 60% of the very, very rich receive their income from work, and still we hate them, still we are told to resent them. It’s very hard to persuade voters that the rich deserve to be penalized with higher taxes, or to make the rich the villains if the rich are tied to work, and that’s the key point. It is especially hard if middle class voters believe that their own work can help make them rich one day, and that’s what’s being destroyed, that’s what’s under assault by this regime, the notion that hard work is going to take you to new heights. A lot of people are throwing their arms up in frustration, “Yeah, Rush, great, if I could find work.” And I totally understand and empathize with that.
But if the prevailing opinion of the very, very rich is a bunch of thieves, Lucky Sperm Club or the like and you have the Democrat Party and the American left coming out demonizing these people, and they have, then you’re gonna be very successful in exploiting this whole thing that we call class envy and that begets a call to equalize outcomes, to get the government to be the equalizing agent, to make it fair. And so the question is open, what percentage of our population actually wants this to be a welfare state nation, and is it growing? We know that over 50% of the people in this country receive some sort of check from the government for something. Social Security, Medicare, food stamps, what have you, AFDC. We know that. But attitudinally, it’s still an open question. You and I hope and pray that it’s a relatively small number still in the minority.
You and I hope and pray that people still have this traditional concept of the American dream: hard work, ambition, fruits of your labor paying off. Not every time, of course. Nothing’s ever guaranteed. But as a value base it can’t be beat for engineering and producing the most prosperity, the greatest opportunity for prosperity the human race has ever known, the United States of America. And yet you’ve got essentially a bunch of sniveling, lazy failures who resent that and want an all powerful government to come around and redistribute things so that they don’t have to work. Fifteen percent unemployment, fine and dandy, as long as I have the basics, I’m cool with it, they say. But it ought to change a lot of people’s minds when they learn that the vast majority of the super and the very, very rich got that way by working, not the Lucky Sperm Club. Got it by working and by continuing to work. And some of them lose it, they risk it away.
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RUSH: By the way, the Wall Street Journal, interestingly, has a blog today: “Does America Have Too Many Rich People?” and it turns out that from a little survey they’ve taken, America does not hate the rich. “At last count, the U.S. has 5.2 millionaire households, and somewhere around three million individual millionaires. That is by far the largest number for any country in the world. And the individuals represent about 1% of the population,” which is which is pretty constant from generation to generation. Now, “”When asked, ‘Do we have too many rich people in this country, just the right amount or too few,’ 42% (the largest number) said ‘just right.’ Another 31% said ‘too many’ (down from 37% in 2007) and 21% said ‘too few’ (up from 17% in 2007).” This Gallup, and these numbers are from today versus 2007.
So there’s reason for optimism, but I’m telling you: The American left and the media are doing everything they can to drum up about a bunch of phony hatred, and it’s not new — class envy and phony hatred for the achievers. The frustrating thing is all these literal dimwits — and you can see ’em. These are the people that post comments to all these left-wing blogs. They’re genuine mental midgets, “vacants” with the IQs of a pencil eraser. But they have this pent-up resentment and hatred, and they’re the ones running around pushing for the government to equalize outcomes on the basis of fairness. It’s just never worked whenever its been tried, and people in societies where with it has been tried are miserable…if they’re alive.
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RUSH: Bayville, New Jersey. Hello, John. It’s great to have you on the EIB Network. Hello.
CALLER: Hey, how you doing, Rush? I appreciate you taking my call.
RUSH: You bet.
CALLER: I got a quick question. In order to stimulate the US economy, why are we giving tax cuts or the largest tax cuts to companies that are hiring or employing mostly — mostly — US workers, buying raw materials in the United States, and making products in the United States for sale in the United States?
RUSH: Because we don’t want to stimulate the US economy.
CALLER: It’s just frustrating. I mean, even on the Republican standpoint, “Let’s give tax breaks to everybody.” No. Let’s focus it on recycling that money back through the US.
RUSH: Well, wait a minute. Wait a second. Nobody is focusing on “tax breaks.” By the way, there’s another thing: This term “tax break.” That implies some kind of a crony deal. There’s no such thing. Tax break, tax cuts. Forget this term. A tax “break” is what GE gets. They don’t pay any.
CALLER: I meant to say lowering tax rates.
RUSH: Okay. I know I did. But you’ve been co-opted like everybody has by that “tax break” lingo.
CALLER: Right.
RUSH: It’s a “tax break,” as though somebody’s skating away with a secret, behind-closed-doors, under-the-table deal — and that’s a creation of the media and of the left. You know, whether the money… I’ll tell you, if you want to get money back in the United States — how many did I read the other day, how many trillions of dollars? — there’s a simple little change in the tax code you could make, and you could repatriate trillions of US dollars. I’m having a mental block on what it’s called, but international corporations that have headquarters in the United States have to keep money that they’ve earned outside this country, otherwise there’s a humongous big tax on it.
If we’d just wave that for a year the influx of dollars from overseas would be would be profound. Tax rate reductions? We have plenty of room to cut taxes before we reach the point of diminishing returns, particularly in the overseas profit tax. But we have plenty of room to cut taxes before we reach the point of diminishing returns, particularly on the corporate tax side. When you talk about “rich,” there’s all different kinds of rich people, too. There are the politically connected rich. The political corrected rich is a guy named James Johnson at Fannie Mae who got rich by paying himself under the table from taxpayer money sent to Fannie Mae.
He didn’t produce anything. In fact, what he did with Fannie Mae is run it into debt and helped destroy the housing sector, and he is worth a hundred-or-so million dollars in the process. Franklin Raines who later became CEO, president of Fannie Mae: Same thing. Jamie Gorelick. These are people who are politically connected who have had money “dispensed” to them, so to speak — and then you have the working stiff rich. These are the people that actually create things or generate streams of income for themselves and for people. They actually do things that cause the economic pie to enlarge.
Steve Jobs would be a great example of this, and Fred Smith at FedEx. These people are legion, and they started with nothing. They started in their garages or they started with an idea that they gotta C on for their doctoral thesis. That’s Fred Smith and FedEx. He got a C, I think at Harvard or whatever, but he decided to go ahead with it anyway, and look at it. There are all kinds of them — and interestingly enough, as we were discussing, the politically connected rich? They’re the ones held in high regard, and that’s what government is to these people. The government, the Treasury? “Look at all that money! I gotta get to Washington and I gotta get my hands in that pile for doing nothing other than being connected.”
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RUSH: Fred in Orlando, Florida, Open Line Friday as we keep on. Hello, sir. Welcome.
CALLER: Good time, down low, black conservative dittos, Rush.
RUSH: Thank you, sir.
CALLER: I teach business and calculus. I tell me students that we need as many millionaires as possible because only millionaires can pay you thousands of dollars for your degree — and the more millionaires we have the more opportunity you have to actually get hired for thousands of dollars. I tell them it’s a factor of about a thousand. Millionaires can pay thousand dollars. I’m a “thousanaire.” I can only pay people in the hundreds. The NFL pays players in millions. That’s because they make billions.
RUSH: Right.
CALLER: You need as many billionaires as possible to have as many millionaires, and you need as many millionaires to have thousandaires.
RUSH: You say you are a college professor?
CALLER: Yes.
RUSH: What’s so hard about…? What you said is just common sense. What’s so hard for people to learn that?
CALLER: Because the students have learned it all backwards. When they hear me say this, their opinion is that we have too many millionaires and they’re sucking the money out of the economy.
RUSH: I know. They think it’s a zero-sum game.
CALLER: Yeah.
RUSH: They think if you get a dollar, somebody has to have lost one.
CALLER: Yes, and I had to kinda un-teach all that.
RUSH: Well, what’s your success rate, do you think?
CALLER: Oh, my success rate?
RUSH: Yeah.
CALLER: Ehhh, it’s not that good.
RUSH: What age? You’re teaching college students.
CALLER: Yes. Yes. So I got 18 to sixties.
RUSH: Well, that’s great. But, you know, all you’re doing is preaching common sense. It’s gotta sink in at some point.
CALLER: Yeah. One of the things: I don’t get challenged very often when I introduce these new concepts of supply and demand. I explain how actually the economy works. I explain that there are about 50 or 60 oil companies in the world, and we only have about four or five, and our four or five has to compete with all the rest of them as far as oil. Oil is an international commodity.
RUSH: Right.
CALLER: It doesn’t just cost here, it costs in the world, and they don’t understand that. They don’t understand that when you give our oil companies a hard time, that gives them a hard time competing in the world.
RUSH: Well, you’re right. They’ve also been told that Big Oil is evil and wants to kill them. All corporations want to kill their customers. You know what the problem is, folks? Fred, thanks for the call out there. I appreciate it. You know what the problem is? The problem is that the left has the economy and government confused. Well, they’re not confused, but they have purposely made it confusing. In the real world, if the government gives you anything, it’s only because they first took it from someone else. It doesn’t work that way in a market economy. But the people he’s talking about, his students, think the government is the source of what you have not the private sector.
(sinister voice) “The private sector is the focus of evil and unfairness and mean-spiritedness. Death! Coffee that’s too hot can kill you if you spill it. The private sector, that’s where all the cheats, and that’s where all the sharks are. They’re gonna eat you up and spit you out! The government is where all the love and compassion and understanding is.” So to people who have been mis-educated, mal-educated, ill-informed, brainwashed, what have you: Government is where you get stuff. The economy is where you get screwed. Private sector’s where you get screwed. The government is where stuff comes from. (interruption)
When did I first learn about supply and demand? Umm… High school. Maybe junior high, I forget. But it was in certainly one of the two, junior high or high school. That’s… (interruption) I know, they’re new concepts to college kids. Supply and demand, new concepts. That’s why I say: To these people, they have been taught that government is where stuff comes from. Government is where you get stuff. I know you believe me, but just drive by any federal building — or for that matter, drive by a state government building, and you check and see. Try to get a parking place at one of them — and it’s not all the DMV in there, folks. They pass out checks in these places.
I guaran-damn-tee you that’s where people have been condition to get things. And then when you try to use the private sector. Did you see this out of the US Open at Bethesda, Maryland? “A county inspector ordered … kids to shut down the stand they set up on Persimmon Tree Rd., right next to Congressional. And after they allegedly ignored a couple of warnings, the inspector fined their parents $500. … ‘Cute little kids making five or ten dollars is a little bit different than making hundreds. You’ve got coolers and coolers here,’ the inspector responded. ‘To raise money for pediatric cancer,'” but you had regulators go and shut down a kids lemonade stand, ultimately fined $500, shut down by Montgomery County, Maryland.
They’re liberals in Montgomery County. Isn’t Montgomery County is where they tried to pass this no smoking ordinance ’cause somebody 200 feet away in a house could smell somebody smoking a cigarette 200 feet away inside their house with closed windows? (interruption) Right. Yeah. Yeah. Yeah, yeah, yeah, yeah. “Montgomery County, make sure you turn off all the lights,” exactly right. (interruption) When you make a dollar from selling tea like at this lemonade stand, you didn’t take it from anybody. There’s a medium of exchange there, and it’s of course purchased by choice. When the government gives you a dollar, they had to first take that dollar from somebody. These are really I think crucial and serious times.
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