How Fat Cats Buy Access
Surely one of the most amusing developments of the 2000 presidential
election campaign is the emergence of Billionaires for Bush (or Gore).
With chants and slogans like "Vote for Bush (or Gore) Because Inequality
is Not Growing Fast Enough" and "Who needs day care, hire an au pair!" the
Billionaires have highlighted not only the big money corruption of
politics, but problems of growing income and wealth inequality in the
(For more on the Billionaires for Bush (or Gore), a project of the
Boston-based activist group United for a Fair Economy, see
Far less entertaining, but somewhat more surprising is a recent report
from the Conference Board that also highlights how the current economic
boom times have left low-wage workers behind.
The Conference Board's answers the question in its report title, "Does a
Rising Tide Lift All Boats?" with a telling subtitle: "America's Full-Time
Working Poor Reap Limited Gains in the New Economy."
The report is important for two reasons.
First, it shows that distribution of the gains from the information
economy have been extremely skewed, with benefits heavily concentrated
among the wealthy and not shared among the bottom of the income and
"Poverty has risen in both the number and share of those employed
full-time and year-round since 1973," the report finds. While the number
of full-time workers making poverty wages declined dramatically in the
1960s and early 1970s (from just under 5 percent in 1966 to 2 percent in
1973), there have been no gains since then. In fact, the proportion of
full-time workers making poverty wages rose to 2.9 percent in 1998, the
most recent year for which such data is available.
The number of full-time workers earning poverty wages does not indicate
the number of people in poverty, because it does not register the poverty
rate among those without full-time work, nor does it take into account the
effects of taxes, tax credits (including the important Earned Income Tax
Credit) or government assistance for poor people.
But by focusing on wages rather than ancillary government support and
taxation programs, the Conference Board offers a unique insight into the
failure of the current wage distribution to enable families to escape from
poverty. (The numbers would appear far worse had the analysis focused on a
living wage level, which is significantly above the artificially low
The second reason the Conference Board report is important is because of
what the Conference Board is.
The New York-based organization is a business-backed research enterprise
best known for its monthly Leading Economic Indicators and Consumer
Confidence Index. It is viewed as a dispassionate research agency, not a
front group for the corporations that fund it.
Its trustees and officers represent a segment of the enlightened corporate
class, those who are aiming to protect corporations' long-term interests.
Among those corporations represented: Bestfoods, Phillips Petroleum, J.C.
Penney, Excel, Texaco, Martha Stewart Living, Fidelity Management and
Research, Goldman Sachs, British Airways, Unisys -- and yes, we know many
of these may not seem "enlightened." But the point is that in their
concern to head off social unrest before it develops, they may be willing
to make significant concessions in an attempt to quiet social movements.
In a description of its historical origins, the Conference Board says it
"was born out of a crisis of industry in 1916" when "declining public
confidence in business and rising labor unrest had become severe threats
to economic growth and stability."
The decision to focus a report on the failure of the new economy to
provide above-poverty wages to millions of full-time workers suggests that
there may be, perhaps, an emerging concern with income and wealth
inequality among foresighted business leaders.
"For too long, we've only counted our money, but today we stand up and
count ourselves. Billionaires, stand up and be counted!" proclaimed Phil
T. Rich at the Million Billionaires March outside the Republican
convention in Philadelphia on July 30.
The Conference Board may not be ready to join such mocking efforts, but
these and other stirrings of discontent do seem to be worrying the
Conference Board's corporate members.
Are the Conference Board members ready to support unionization and living
wage regulations, among the obvious solutions to the problems highlighted
in the organization's recent report?
Without a bit more of the "unrest" which led to the Conference Board's
founding, probably not. But the publication of the report, the emergence
of the Billionaires for Bush (or Gore) and aggressive union organizing of
low-wage workers by some U.S. unions may in different ways signal that
such unrest is now, slowly but finally, growing.
- 106 Money & Politics