U.S. History Repeating itself Again and Again: How Wall Street Occupied America

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“… Wall Street owns the country. It is no longer a government of the people, by the people, and for the people, but a government of Wall Street, by Wall Street, and for Wall Street. The great common people of this country are slaves, and monopoly is the master… Money rules… Our laws are the output of a system which clothes rascals in robes and honesty in rags. The political parties lie to us and the political speakers mislead us…”

I’ll bet you thought that the above quote is a recent product of the Occupy Wall Street movement. It’s not. It was said by the populist Mary Elizabeth Lease in the late 19th Century, referring to the class war of the rich against the poor and the rest of us. What we are going through now is another repetition of that history. History has repeated itself over and over again in our country on this issue.

The United States was born as a result of oppression that resulted in a Revolutionary War (1775-83). Seventy-five years later, in 1858, more than two years before he was elected President of the United States, Abraham Lincoln, speaking on the subject of slavery, said:

Lincoln’s words were prophetic. He was elected President in November 1860, and in response the American Slavocracy initiated a series of events leading to the American Civil War (1861-5) and the consequent end slavery.

Class war in the United States up to the 1930s

Both the American Revolutionary War and the Civil War were extensions of different forms of class warfare in our country. The Slavocracy in 19th Century United States was determined that black people would remain third class persons – or non-persons – for as long as they had any say in the matter.

Mary Elizabeth Lease’s above-noted speech referred to parallels between black slavery and the newer forms of class warfare. Before getting to the part quoted above, she said: “We wiped out slavery… and national banks began a system of white wage slavery… Wall Street owns the country.”

Eventually, reaction set in against the “robber barons” who Lease referred to in her speech, and measures were taken to reduce income and power disparities in America. One very important result of that reaction was the Progressive Movement, which was responsible for the creation of a great deal of important reform legislation, including: The 17th Amendment to our Constitution, which required the direct election of US Senators; the secret ballot; child labor laws to protect children against the abuses of corporate power; the 19th Amendment to our Constitution, which gave women the right to vote; anti-trust laws, such as the Sherman Anti-trust Act of 1890 and the Clayton Anti-trust Act of 1914, which limited corporate economic power by requiring fair competition; the 16th Amendment to the Constitution, which established the graduated (progressive) income tax; and the Pure Food and Drug Act, which provided consumer protection against unsafe foods and drugs by establishing the Food and Drug administration. Though the movement never won a presidential election, it undoubtedly moved both major parties quite a bit to the left.

Its first candidate for President was former President Theodore Roosevelt, who ran largely because he was very unhappy about the conservative views and policies of his hand-picked successor, William Howard Taft. In the presidential election of 1912, Roosevelt won 27% of the national vote and carried 8 states (WA, CA, NE, MN, MI, PA) in a three-way race against the two major party candidates, finishing in second place.

But the 1920s saw a succession of three very fiscally conservative Republican presidents (Warren Harding, Calvin Coolidge, and Herbert Hoover), during which income disparity in our country expanded back to Gilded Age proportions – with the top 1% of individuals accounting for 17% of annual income and the top 10% accounting for 44% of annual income. (And that’s not even counting income from capital gains). This culminated in the Stock Market Crash of 1929, which was followed by the Great Depression – the worst economic depression in U.S. history.

FDR’s counteroffensive

Franklin Delano Roosevelt, after ascending to the presidency in 1932, initiated a wide range of policies – collectively referred to as the New Deal – which had the effect of substantially reversing income inequality for the first time in U.S. history. These policies included: Progressive taxation, with record income tax rates exceeding 90% on wealthy corporations and individuals; labor protection laws; and several policies to provide a social safety net for Americans and otherwise reduce income inequality, including the Social Security Act of 1935, the GI Bill of Rights, and the development of several policies to facilitate job creation.

Probably no figure in American history is despised as much by conservatives as FDR, who was accused in his day of being a Communist by many a conservative. Cass Sunstein, in his book, “The Second Bill of Rights – FDR’s Unfinished Revolution and Why We Need it More than Ever”, describes the philosophy that motivated Roosevelt to fight for his radical (at the time) programs to benefit the American people:

Consequently, FDR introduced the concept of economic and social rights, which had not gained much traction in the United States until his Presidency. FDR’s Presidency and fervent advocating of these rights coincided with circumstances (The Great Depression) that made their need glaringly apparent to a large proportion of American citizens. Roosevelt’s method for establishing a Second Bill of Rights was through more than twelve years of advocating for these rights and putting them into practice through executive orders and pushing Congress to enact legislation. Perhaps more important, by the end of FDR’s Presidency large segments of the American population accepted many aspects of his Second Bill of Rights as legitimate rights – for example, the right to a good education.

FDR’s New Deal went a long way towards bringing us out of the Great Depression. Perhaps just as important, it created a legal framework that provided the basis for the creation of the largest middle class our country had ever known, and what Paul Krugman refers to as the greatest sustained economic boom in U.S. history to this day.

Bill Moyers speaks of this time from a personal point of view in an article titled “How Wall Street Occupied America – Why the Rich Keep Getting Richer and our Democracy is Getting Poorer”. After noting that his father never made over $100 a week in his life, he says:

The wealthy mobilize to destroy the New Deal and regain their chokehold on power

Moyers speaks of how class warfare of the rich against the rest of us revved up again beginning in the early 1970s:

Moyers then discusses how that beginning has brought us to our current woeful state of affairs:

The root of our problem – the corruption of democracy by money

Moyers explains in his book, Moyers on Democracy, that the root of the problem is that our elected representatives in Congress need huge sums of money to finance their campaigns and remain in office. As a result of this:

In his more recent article, Moyers describes this problem in terms of our current situation:

The Occupy Wall Street movement as a reaction against the collaboration of corporate power and government

In an article titled “Leaving Washington Behind”, Gordon Lafer explains why the Occupy Wall Street (OWS) movement is not at all interested in party politics, as our current situation now stands:

Lafer makes it clear that, though the Republicans are worse, both parties are to blame:

Where does that leave us?

I strongly agree with both Moyers and Lafer on this issue. Moyers is correct that most of our politicians, including enough Democrats to give the top 1% a great advantage in their class war against the rest of us, “are little more than money launderers in the trafficking of power and policy”. Similarly, Lafer is correct that “There is simply no chance that the little people will triumph over big business in this process…” What that means is that the system needs a radical overhaul in order to shift the balance of power enough to prevent the 1% from trampling all over the rest of us and our children and grandchildren.

Hope lies in the fact that a large percent of Americans are beginning to understand what is going on. Lafer notes:

A recent poll shows that the percent of Americans who have heard of the OWS movement is continuing to increase (64% as of October 28-31, compared to 51% in an earlier poll), and 36% agree with its overall positions, compared to only 19% who disagree. Compare that to the woeful 9% approval that the U.S. Congress received in a recent poll.

And Bill Moyers, despite his pessimism over our current political situation, points to history in putting his faith in the people, and urges us to press on: