Posted on 12/25/2012 9:09:31 AM PST by Kaslin
In large part because of an excessive burden of government, the American economy is suffering European-style stagnation, with even the Washington Post now confessing that growth far below the long-run trend.
This helps explain why job creation has been so dismal in recent years, with more than twenty million Americans out of work, underemployed, or dropped out of the workforce.
But there is one pocket of enormous prosperity in America. It will warm your heart to know that our overlords in Washington are living the life of Riley.
Here are some of the highlights of a remarkable Reuters expose about the fat cats of big government, starting with the huge gap between the insider elite and the poor.
In the town that launched the War on Poverty 48 years ago, the poor are getting poorer despite the government’s help. And the rich are getting richer because of it. The top 5 percent of households in Washington, D.C., made more than $500,000 on average last year, while the bottom 20 percent earned less than $9,500 – a ratio of 54 to 1. That gap is up from 39 to 1 two decades ago. It’s wider than in any of the 50 states and all but two major cities.
One small but important correction in the previous excerpt. As I have noted many times, the “poor are getting poorer” because of “the government’s help.”
The article then explains that a lot of the redistribution in Washington is from taxpayers to a pampered elite.
…in the years since President Lyndon Johnson took aim at poverty in his first State of the Union address, there has been an increasingly strong crosscurrent: The government is redistributing wealth up, too – especially in the nation’s capital. …Two decades of record federal spending and expanding regulation have fostered a growing upper class of federal contractors, lobbyists and lawyers in the District of Columbia area. …Direct spending by the federal government accounts for 40 percent of the area’s $425 billion-a-year economy. …Roughly 15 cents of every dollar from the entire federal procurement budget stays in or around the government’s hometown, said Stephen S. Fuller, director of the Center for Regional Analysis at George Mason University. Last year, that was about $80 billion out of $536 billion in procurement spending, he said. The 15 percent share is far greater than the region’s 2 percent portion of the U.S. population. “We’re seeing an enormous transfer of wealth from taxpayers to the Washington economy,” said Fuller.
And all this spending leads to an elitist class of cronyists, politicians, contractors, bureaucrats, and lobbyists.
No wonder the DC area is home to some of the richest counties in America.
But unlike other well-to-do areas, the wealth in DC is rarely accumulated by honest means.
Instead, it’s the result of perverse form of redistribution to big-government insiders. Check out these horrifying details.
Washington-area workers with incomes above $100,000 rose to 22 percent of the workforce, up from 14 percent in 1990, adjusted for inflation, a Reuters analysis of Census data found. …there are 320,000 federal jobs in the Washington area. Within the District of Columbia, 55 percent pay $100,000 or more. …Nearly 13,000 lobbyists registered with the government last year and reported $3.3 billion in fees, or about $260,000 per lobbyist. That’s 22 percent more lobbyists and 37 percent more inflation-adjusted revenue per lobbyist than in 1998… Times are flush for Washington lawyers as well. The number of attorneys in the area has risen 44 percent, twice the national rate, to 41,000 since 1999. Their average income, adjusted for inflation, rose 35 percent to $156,000.
I guess we know who’s having a merry Christmas.
All these rich bureaucrats, lobbyists, politicians, cronyists, and contractors certainly are living the good life, as revealed in a Washington Post story on the “Region’s Rising Wealth.” Here are some sordid excerpts.
…the D.C. region already has a reputation as one of the most affluent in the country. But the area is fast emerging as a home to the truly rich as well. High-end luxury retailers are responding. Brands such as Aston Martin are expanding their operations into the area — betting, for instance, that there will be plenty of customers who can afford the $280,000 sports car James Bond drives in the movies. …Already there are 500 Aston Martin owners in the area with the potential for more.
I’ve already shared an interview with Andrew Ferguson by Reason TV that should make all taxpayers upset. Why should ordinary taxpayers be coerced to subsidize Washington’s high-flying parasite economy?
Redistribution is a bad thing in most circumstances. But when you redistribute from poor to rich, that’s utterly perverse.
Well, thanks to profligacy by Bush and Obama, that’s exactly what’s happened.
The region’s top one percent of households make more than a half million dollars yearly — far more than the national average for the one percent, according to a study of Census data by Sentier Research, an Annapolis-based data analysis firm. And these top earners — many of whom are from dual-income households and benefit from federal contracting — weathered the recession better than their counterparts in some other metropolitan areas and the nation. More are moving beyond comfortable affluence to a much higher standard of living. “What is unique to D.C. is that there has been a change in the complexion of wealth here. There didn’t used to be much of this ultra-high-net-worth business here and now there is,” said Susan Traver, the regional president of BNY Mellon Wealth Management.
But everyone in the rest of America at least can go to sleep tonight with a warm and fuzzy feeling of joy, knowing that our money has created such comfortable lives for the political elite.
Milton Pedraza, the CEO of the Luxury Institute, a research and consulting firm, said that purveyors of luxury goods are drawn to the area because it has…a stable economy bolstered by the federal government. Government contracting, where some local entrepreneurs and business owners amassed their fortunes, has been a key driver of the region’s economy for three decades. A third of the region’s gross regional product still comes from federal spending… “Let’s face it .?.?. the only place with money during the recession was Washington, D.C.,” Pedraza said.
Perhaps we should make a slight correction in the previous excerpt. After all, shouldn’t it read “America suffered a recession because the only place with money was Washington, DC.”
Let’s wrap this up. A few years ago, I issued this video about overpaid bureaucrats.
But I now realize my mini-documentary only scratches the surface. Yes, there are too many paper-pushers on the government payroll, and of course they get far too much compensation.
But what about unofficial government workforce of over-paid contractors? And all the lobbyists, consultants, and cronyists that exist only because we have a bloated federal government?
Our nation is being seriously damaged by this corrupt system, and I fear that the outcome will be Argentinian-style decline.
I disagree.
Our system has been co-opted by 49% ownership in Chinese growth.
That was good for a while, but now it is financing our downfall.
We need to bring back US companies and jobs here.
100% ownership in American companies.
Now.
Hey Wapo, welcome to the party, pal.
There is no conflict between what we both said.
The same politicians who are enamored with the French legal system are also “internationalists”, who see no advantage to jobs and prosperity being kept here, when *they* could make more money elsewhere. Internationalists, almost by definition, have no national loyalty.
As self-imagined elites, they will always direct business to where labor is cheapest, since they equate Americans who are not elites as no different than Chinese peasants.
My apologies.
Let me re-read it then. Cheers.
OK but I don’t see any preference stated in your post as to where jobs should be located.
We are rapidly facing a decision:
Lose our way of life, to continue buying the cheapest things around. Ruining Americans’ living standard. Eventually bankrupting our nation. (perhaps much sooner than eventually)
Or start moving to counteract the global bias against American products.
It needs to start now. American products need to be made for America.
There has been a terrible bias worldwide against US production.
We need to stop sending all our jobs elsewhere.
Bring back US jobs.
I visited DC and NoVa in April. It looked like America used to look. You didn’t see “Available” and “For Lease” signs on 40% of the commercial buildings. Prosperity was evident everywhere you went.
My cousin lives in DC. She bought a house for 800 grand that would be about 40 here in Indiana.
I tell young people who are interested in relocating that’s the place to be if they can stomach the congestion. Snag one of those 15,000 new IRS jobs for enforcing Obamacare.
DC is a DeathStar. Its parasite population must be 5 million when you include suburbs and families with children. The first parasites in line are direct Federal “workers”. Then come the contractors. Both are doing great via the taxes (and other payments) they extract from far flung provinces such as Nevada, North Dakota, Alaska. What Alaskan ever want to see a Federal official? They are 4,000 miles from DC. Last dirty deed done to them was the EPA blocking Shell oil from a large project Shell had already spent four billion on. Alaskans would have gotten huge royalties from this in the state treasury. Maybe some of it sent to residents but could have decreased taxes all over
http://blog.heritage.org/2011/04/25/epa-blocks-oil-drilling-in-alaska/
http://www.huffingtonpost.com/2012/01/13/shell-arctic-permit-epa_n_1203185.html
A young woman with two kids. I don't know if they were her kids or not...but she bought two bags of gummy bears or something like them...with Food Stamps.
Then she whipped out the cash to buy a pack of Marlboro's. She was dressed and clean..and so were the kids. The got into a nice SUV...newer than mine.
I wondered why she was on Food Stamps....Probably a reason, I guess.
Absolutely right!
“I wondered why she was on Food Stamps.”
Probably on disability too,due to a severe work allergy.
What did you expect? The Hamiltonian access-capitalist crowd has always wanted this. Think of Hamilton and his ring of precious-metals arbitrageurs, buying and selling gold and silver by turns, and shipping the annual mint runs of the young, cash-starved American economy off to Europe to be melted down, and pocketing profits on the order of fractions of a penny on the dollar.
Congress finally stopped this ring by depreciating the dollar in the late 1830's. That is why a US silver dollar no longer weighed the same as a Spanish, Mexican, or Polish one (all tied to the old Hapsburg thaler of .77~ oz. of .925 [sterling] silver, on the old Roman purity standard), and why our silver and gold purity was cut to .900 fine simultaneously.
Some of the New World republics followed the U.S.: by 1905, a Peruvian sol and a Panamanian Balboa were exactly the same size and weight as a U.S. silver dollar, and a Venezuelan bolivar stacked precisely with an American quarter-dollar, and was worth exactly 10 Panamanian 2-1/2 centesimo "Panama buttons", so that people all around northern South America could use those currencies interchangeably and with confidence.
Recalcitrant, Yanqui-resisting Mexico, however, stayed on the old Hapsburg standard (never mind that they'd recently had to execute one of them for pretending to the vacant Mexican throne), and issued the old-style "cap-and-ray" dollares pesos well into the 20th century.
On the bright side, Alexander Hamilton was a protectionist and as Secretary of Treasury made sure we had a patrolling fleet of ships (cutters) that made sure that tariffs were collected on inbound goods
Yes, he sure did -- sock those competitors! Fill the Treasury from the pockets of those agrarian yayhoos, and force them to buy Millocracy goods!
But he also taxed on the other side -- American produce. He imposed the tax on whiskey (which is how the trans-Appalachian farmers, who had no roads to market, were moving their crops downriver in "concentrated bulk" and value-added form -- following the example of the sugar-cane planters) that led directly to the Whiskey Rebellion. He imposed it in all good faith </s>: The producers were farmers nobody cared about, who had no participation in American politics worth worrying about, and the consumers were river-town drunks, ditto-ditto and ditto again; and the money would flow into the Treasury to fund "improvements" intended to benefit businessmen in *important* economic centers like, oh, New York City. In other words -- Hamilton's pals, again.
It was, in a word .... "poifeckt!"
Tea Party not allowed.
The Feds had no income tax back then. As you know their main sources of revenue were tariffs, alcohol taxes and tobacco taxes. Two sin taxes inj there.
They had to tax something! And whiskey was a reasonable item
btt
Yeah, 'specially as so little of it was made in New York City ....
<singing>
"Don't tax you and Don't tax me;
We'll tax that fellow there
Under that tree!"
</ singing>
I'd maybe have given Hamilton a little credit if he'd, say, offered to tax stock transactions on Wall Street, or marline production or other nautical supplies and products. Or brass running-lights for ships and carriages and hacks. You know, urban lanterns.
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