Plutocracy (Greek: πλοῦτος, ploutos, 'wealth' + κράτος,
kratos, 'rule') or plutarchy, is a form of society defined as being
ruled or controlled by a function of wealth or higher income. The
first known use of the term was in 1631. Unlike systems such as
democracy, capitalism, socialism or anarchism, plutocracy is not
rooted in an established political philosophy. The concept of
plutocracy may be advocated by the wealthy classes of a society in an
indirect or surreptitious fashion, though the term itself is almost
always used in a pejorative sense.
1.2 United States
1.2.1 Post World War II
3 See also
5 Further reading
6 External links
The term plutocracy is generally used as a pejorative to describe or
warn against an undesirable condition. Throughout history,
political thinkers such as Winston Churchill, 19th-century French
sociologist and historian Alexis de Tocqueville, 19th-century Spanish
Juan Donoso Cortés
Juan Donoso Cortés and today
Noam Chomsky have condemned
plutocrats for ignoring their social responsibilities, using their
power to serve their own purposes and thereby increasing poverty and
nurturing class conflict, corrupting societies with greed and
Historic examples of plutocracies include the Roman Empire, some
city-states in Ancient Greece, the civilization of Carthage, the
Italian city-states/merchant republics of Venice, Florence and Genoa,
and the pre-World War II
Empire of Japan (the zaibatsu). According to
Noam Chomsky and Jimmy Carter, the modern day
United States resembles
a plutocracy, though with democratic forms.
One modern, formal example of a plutocracy, according to some critics,
is the City of London. The City (not the whole of modern
the area of the ancient city, about 1 sq mile or 2.5 km2, which
now mainly comprises the financial district) has a unique electoral
system for its local administration. More than two-thirds of voters
are not residents, but rather representatives of businesses and other
bodies that occupy premises in the City, with votes distributed
according to their numbers of employees. The principal justification
for this arrangement is that most of the services provided by the City
London Corporation are used by the businesses in the City. In fact
about 450,000 non-residents constitute the city's day-time population,
far outnumbering the City's 7,000 residents.
Income inequality in the United States
§ Effects on democracy and society
American upper class
American upper class and
Wealth inequality in the United
Some modern historians, politicians, and economists argue that the
United States was effectively plutocratic for at least part of the
Gilded Age and
Progressive Era periods between the end of the Civil
War until the beginning of the Great
Depression. President Theodore Roosevelt
became known as the "trust-buster" for his aggressive use of United
States antitrust law, through which he managed to break up such major
combinations as the largest railroad and Standard Oil, the largest oil
company. According to historian David Burton, "When it came to
domestic political concerns, TR's Bete Noire was the plutocracy."
In his autobiographical account of taking on monopolistic corporations
as president, TR recounted
…we had come to the stage where for our people what was needed was a
real democracy; and of all forms of tyranny the least attractive and
the most vulgar is the tyranny of mere wealth, the tyranny of a
Sherman Antitrust Act
Sherman Antitrust Act had been enacted in 1890, with large
industries reaching monopolistic or near-monopolistic levels of market
concentration and financial capital increasingly integrating
corporations, a handful of very wealthy heads of large corporations
began to exert increasing influence over industry, public opinion and
politics after the Civil War. Money, according to contemporary
progressive and journalist Walter Weyl, was "the mortar of this
edifice", with ideological differences among politicians fading and
the political realm becoming "a mere branch in a still larger,
integrated business. The state, which through the party formally sold
favors to the large corporations, became one of their
In his book The Conscience of a Liberal, in a section entitled The
Politics of Plutocracy, economist
Paul Krugman says plutocracy took
hold because of three factors: at that time, the poorest quarter of
American residents (African-Americans and non-naturalized immigrants)
were ineligible to vote, the wealthy funded the campaigns of
politicians they preferred, and vote buying was "feasible, easy and
widespread", as were other forms of electoral fraud such as ballot-box
stuffing and intimidation of the other party's voters.
The U.S. instituted progressive taxation in 1913, but according to
Shamus Khan, in the 1970s, elites used their increasing political
power to lower their taxes, and today successfully employ what
political scientist Jeffrey Winters calls "the income defense
industry" to greatly reduce their taxes.
Bob Herbert of
The New York Times
The New York Times referred to modern American
plutocrats as "The Donor Class" (list of top donors) and
defined the class, for the first time, as "a tiny group – just
one-quarter of 1 percent of the population – and it is not
representative of the rest of the nation. But its money buys plenty of
Post World War II
In modern times, the term is sometimes used pejoratively to refer to
societies rooted in state-corporate capitalism or which prioritize the
accumulation of wealth over other
According to Kevin Phillips, author and political strategist to
Richard Nixon, the
United States is a plutocracy in which there is a
"fusion of money and government."
Chrystia Freeland, author of Plutocrats: The Rise of the New Global
Super-Rich and the Fall of Everyone Else, says that the present
trend towards plutocracy occurs because the rich feel that their
interests are shared by society.
You don't do this in a kind of chortling, smoking your cigar,
conspiratorial thinking way. You do it by persuading yourself that
what is in your own personal self-interest is in the interests of
everybody else. So you persuade yourself that, actually, government
services, things like spending on education, which is what created
that social mobility in the first place, need to be cut so that the
deficit will shrink, so that your tax bill doesn't go up. And what I
really worry about is, there is so much money and so much power at the
very top, and the gap between those people at the very top and
everybody else is so great, that we are going to see social mobility
choked off and society transformed.
— Chrystia Freeland, NPR
When the Nobel-Prize winning economist
Joseph Stiglitz wrote the 2011
Vanity Fair magazine article entitled "Of the 1%, by the 1%, for the
1%", the title and content supported Stiglitz's claim that the United
States is increasingly ruled by the wealthiest 1%. Some
researchers have said the US may be drifting towards a form of
oligarchy, as individual citizens have less impact than economic
elites and organized interest groups upon public policy. A study
conducted by political scientists Martin Gilens (Princeton University)
and Benjamin Page (Northwestern University), which was released in
April 2014, stated that their "analyses suggest that majorities of
the American public actually have little influence over the policies
our government adopts". Gilens and Page do not characterize the U. S.
as an "oligarchy" or "plutocracy" per se; however, they do apply the
concept of "civil oligarchy" as used by Jeffrey A. Winters with
respect to the US.
Further information: Russian oligarch
A report by
Credit Suisse in 2013 states that "Russia has the highest
level of wealth inequality in the world, apart from small Caribbean
nations with resident billionaires." Worldwide, there is one
billionaire for every USD 170 billion in household wealth; Russia has
one for every USD 11 billion. Worldwide, billionaires collectively
account for 1%– 2% of total household wealth and the top 20 of the
billionaires in USA own 50% of all wealth in the U.S.; in Russia
today, all of the billionaires own 35% of all wealth.
In the political jargon and propaganda of Fascist Italy, Nazi Germany
and the Communist International, western democratic states were
referred to as plutocracies, with the implication being that a small
number of extremely wealthy individuals were controlling the countries
and holding them to ransom.
Plutocracy replaced democracy and
capitalism as the principal fascist term for the
United States and
Great Britain during the Second World War. For the Nazis, the
term was often a code word for "the Jews".
^ "Plutocracy". Merriam Webster. Retrieved 2 June 2017.
^ "The study of attitudes is reasonably easy [...] it's concluded that
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scale - they have no influence on policy whatsoever. They're
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you get a little bit more influence on policy. When you get to the
top, which is maybe a tenth of one percent, people essentially get
what they want, i.e. they determine the policy. So the proper term for
that is not democracy; it's plutocracy." Extract from the transcript
of a speech delivered by
Noam Chomsky in Bonn, Germany, at DW Global
Media Forum, 15 August 2013.
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^ Chomsky, Noam (6 October 2015). "America is a plutocracy
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^ Carter, Jimmy (15 October 2015). "
Jimmy Carter on Whether He Could
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^ Kahn, Shamus (18 September 2012) "The Rich Haven’t Always Hated
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^ Full Show: The Long, Dark Shadows of Plutocracy. Moyers &
Company, 28 November 2014.
^ Transcript. Bill Moyers Interviews Kevin Phillips. NOW with Bill
Moyers 4.09.04 PBS
^ Freeland, Chrystia (2012). Plutocrats: the rise of the new global
super-rich and the fall of everyone else. New York: Penguin.
ISBN 9781594204098. OCLC 780480424.
^ National Public Radio (15 October 2012) "A Startling Gap Between Us
And Them In 'Plutocrats'"
^ See also the
Chrystia Freeland interview for the Moyers Book Club
(12 October 2012) Moyers & Company Full Show:
^ Stiglitz Joseph E. "Of the 1%, by the 1%, for the 1%" Vanity Fair,
May 2011; see also the
Democracy Now! interview with Joseph Stiglitz:
Assault on Social Spending, Pro-Rich Tax Cuts Turning U.S. into Nation
"Of the 1 Percent, by the 1 Percent, for the 1 Percent", Democracy
Now! Archive, Thursday, 7 April 2011
^ Piketty, Thomas (2014). Capital in the Twenty-First Century. Belknap
Press. ISBN 067443000X p. 514: "the risk of a drift towards
oligarchy is real and gives little reason for optimism about where the
United States is headed."
^ Gilens & Page (2014) Testing Theories of American Politics:
Elites, Interest Groups, and Average Citizens, Perspectives on
Politics, Princeton University. Retrieved 18 April 2014.
^ Winters, Jeffrey A. "Oligarchy" Cambridge University Press, 2011,
^ Top 20 billionaires worth as much as half of America Robert Frank,
Wealth Report Credit Suisse, p October 2013 page 53
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Howard, Milford Wriarson (1895). The American plutocracy. New York:
Norwood, Thomas Manson (1888). Plutocracy: or, American white slavery;
a politico-social novel. New York: The American News Company.
Pettigrew, Richard Franklin (1921). Triumphant Plutocracy: The Story
of American Public Life from 1870 to 1920. New York: The Academy
Reed, John Calvin (1903). The New Plutocracy. New York: Abbey Press.
Winters, Jeffrey A. (2011). "Oligarchy" Cambridge University Press
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