The New Kleptocracy Part 1


By Josh Sager


Throughout history, humans have arranged themselves into societies based around hierarchy and a system of selecting who is allowed to wield power—these social constructs are called governments. At its best, a government exists to provide the common defense, preserve the rule of law, promote the social welfare, and do the things which private industry cannot do equitably or efficiently (ex. maintaining the roads). At its worst, a government can kill millions, promote exploitation, repress its population, and syphon resources from the citizens to the elite.

The United States was originally designed to be a form of representative democracy called a constitutional republic. In this form of government, citizens elect politicians to represent their interests, both on the state and federal levels—these politicians are directly accountable to their constituents. Unfortunately, as money has crept into politics and promoted an ever-increasing centralization of power into the hands of a small group of elites, the United States has started to look less like a constitutional republic and more like a kleptocracy.

A Kleptocracy is a type of government where those in power have turned their authority towards the goal of syphoning wealth from the general public and giving it to the elite; the elite who benefit in a kleptocracy include those in government as well as those with significant power in the private sector. Through utilizing public funds, tax revenue, and government force for personal gain, the elite in a kleptocracy are able to accrue huge amounts of wealth and perpetuate their own political power.

I argue that the government of the United States is beginning to resemble a kleptocracy because it has begun to exhibit several of the classic characteristics which define a kleptocratic government. While no one of these characteristics alone classifies a government as a kleptocracy, the combination of characteristics paints a truly stark picture about how this country may be transforming from a democracy into a kleptocracy:

Characteristic #1: The elite in society utilize political power to enrich themselves on the backs of everybody else

In a kleptocracy, the elite in society create a vicious cycle of wealth accrual and political power. During the creation of a kleptocracy, the elite use their wealth and influence to capture the government and gain the ability to manipulate policy. Once the elite capture the government, they change policy to benefit themselves and begin to utilize public money to increase their personal profits. As their personal fortunes grow, the elite kleptocrats complete the cycle by using a portion of the money gained from controlling the government to perpetuate their political power. Once this cycle is initiated, it is very difficult to stop and usually results in widespread income inequality within a country.

During the last decade, elites in the United States have been extremely successful in manipulating public policy to favor their interests. By changing public policy into a method of increasing their wealth (even at the expense of the country), American elites have begun to make the United States look very much like a kleptocracy:    

  • Tax rates on wealthy Americans and corporations are at a record low and it appears virtually impossible that this will change significantly in the near future. This decrease in tax income taken from the rich is economically unjustifiable, yet has been pushed by many wealthy individuals, as well as the politicians who are bought by them.
  • Corporate accountability has been drastically reduced in the United States; this reduction benefits American elites because it allows their corporate interests to produce more profit for them, without having to worry about ethics or the danger of being sued. The perfect example of this destruction of corporate accountability is the lack of charges and consequences on the banks after the 2008 economic crash. Despite the presence of a great deal of evidence proving the fraud perpetrated by the banks in the lead-up to the 2008 crash, no bankers have been prosecuted and no banks have been broken up.
  • Government contract are given to corporations which have economic connections to political elites. In the last decade, American elites have directed ever more government contracts to corporations which they control, or which give them money. There are innumerable examples of this cronyism, but the largest example is that of Cheney and Halliburton. While Cheney—the ex-CEO and current stockholder of Halliburton—was vice president, Halliburton received billions in government contracts and preferential treatment in environmental regulations.

Public policy in the United States has been co-opted and redirected to increase the wealth of a small minority of elites. The good of society has taken a backseat to interests of the elite and the United States is suffering for it. When the political and economic elite of a society corrupt policy to the degree which we have seen in recent years, the corrupted government ceases to be a populist government and becomes a kleptocracy.

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