Obama's Raw Deal: Oligarchs benefit as the middle class lags

If Republicans win control of both the House and Senate, “the interests of billionaires will come before the needs of the middle class,” President Barack Obama said at a $32,500-a-plate fundraiser at the $16 million Greenwich, Connecticut, estate of a billionaire named (I’m not making this up) Rich Richman.

You can’t top that remark for hypocrisy or the setting for irony. It isn’t the middle class who write $32,500 checks. Those who do expect something in return. They’ve been getting it.

The Obama administration “protected Wall Street. Not families who were losing their homes. Not people who lost their jobs. And it happened over and over and over,” Sen. Elizabeth Warren, D-Mass., told the liberal webzine Salon. Ms. Fauxcahontas isn’t right about much, but she is about that. Administration policies have rewarded Wall Streeters whose reckless lending magnified the subprime mortgage crisis. “You’ve got Wall Street criminals walking free, sipping tea at the White House,” said left-wing academic Cornel West.

Supplying bupkes for most Americans, the $787 billion stimulus bill produced bonanzas for the politically connected. A disaster for consumers and taxpayers, Obamacare fattened the bottom line of insurance companies. Billionaire Tom Steyer figures to profit from Mr. Obama’s foot-dragging on the Keystone XL pipeline.

The top group of fundraisers for Mr. Obama raised $457,834 for his 2008 campaign – and were approved for federal grants and loans of $11.4 billion, according to the Government Accountability Institute. Selling access to the federal treasury has been a great way for Democrats to raise campaign funds. Since 1989, according to an analysis by Gateway Pundit, big donors have provided $416 million more in direct contributions to Democrats than Republicans.

Seven of the 10 wealthiest counties voted to re-elect the president. Democrats represent eight of the 10 wealthiest congressional districts. There are more Democrats than Republicans among the 268 millionaires in Congress.

There were 9.63 million households last year with a net worth of $1 million or more, up from 6.7 million in 2008. The wealthiest 1 percent received 22.46 percent of the national income in 2012, up from 18.12 percent in 2009, calculated economist Emmanuel Saez. The income of the bottom 99 percent shrank 0.4 percent, Mr. Saez said. Adjusted for inflation, median household income was 8 percent lower in 2013 than before the Great Recession began.

The middle class (those who earn between the 30th and 70th percentiles) accounted for 53 percent of the national income in 1970, just 45 percent in 2012, according to demographer Joel Kotkin, who says “the biggest issue facing the American economy, and our political system, is the gradual descent of the middle class into proletarian status.”

The average compensation of federal employees last year was 74 percent higher than for workers in the private sector. Few would begrudge government workers higher pay and benefits if they earn it. But from the Centers for Disease Control to the Veterans Administration, incompetence, neglect and corruption seem more the rule than the exception. Little wonder, when the chief consequences for malfeasance are a lengthy paid vacation or retirement with generous benefits. By shielding bureaucrats from accountability, Democrats have made “public servant” an oxymoron.

The middle class is shrinking because policies designed to benefit those who feed at the public trough clobber economic growth. The chief difference between the New Oligarchs and the robber barons of yesteryear is that the robber barons had an interest in a vibrant middle class, Mr. Kotkin says in his new book, “The New Class Conflict.” “Gentry liberals” don’t.

In the past, Democrats “recognized broad-based economic growth was a necessary precursor to upward mobility and social justice,” Mr. Kotkin wrote. Now they adopt policies that restrict growth.

Truman Democrats stood up for working men and women. Obama Democrats provide the oligarchs with cheaper servants at the expense of working men and women. The rhetoric hasn’t changed much, but the gap between Harry Truman’s Fair Deal and Barack Obama’s Raw Deal couldn’t be wider.

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JWR contributor Jack Kelly, a former Marine and Green Beret, was a deputy assistant secretary of the Air Force in the Reagan administration.