Is the US a Plutocracy? Citigroup says YES.

[Burnsys]

This leaked document from Citigroup states that the USA, Uk, and Canada are plutocracies (rule by the wealthy).

http://en.wikipedia.org/wiki/Plutocracy
Plutocracy is rule by the wealthy, or power provided by wealth. The combination of both plutocracy and oligarchy is called plutarchy.

Quotes from the document:
[PLAIN]http://img.elblogsalmon.com/2007/01/Citigroup%20logo%20234.158.gif

The World is dividing into two blocs - the Plutonomy and the rest. The U.S.,
UK, and Canada are the key Plutonomies - economies powered by the wealthy.
Continental Europe (ex-Italy) and Japan are in the egalitarian bloc

4) In a plutonomy there is no such animal as“the U.S. consumer” or“the UK
consumer”, or indeed the“Russian consumer”. There are rich consumers, few in
number, but disproportionate in the gigantic slice of income and consumption they take.
There are the rest, the“non-rich”, the multitudinous many, but only accounting for
surprisingly small bites of the national pie.

At third threat (to plutonomy) comes from the potential social backlash. To use Rawlsian analysis, the invisible hand stops working. Perhaps one reason that societies allow plutonomy, is because enough of the electorate believe they have a chance of becoming a Plutoparticipant. Why kill it off, if you can join it? In a sense this is the embodiment of the “American dream”. But if voters feel they cannot participate, they are more likely to
divide up the wealth pie, rather than aspire to being truly rich

Could the plutonomies die because the dream is dead, because enough of society does
not believe they can participate? The answer is of course yes. But we suspect this is a
threat more clearly felt during recessions, and periods of falling wealth, than when
average citizens feel that they are better off. There are signs around the world that
society is unhappy with plutonomy - judging by how tight electoral races are. But as
yet, there seems little political fight being born out on this battleground.

As the rich have been getting richer, so too stocks associated with the rich, have
performed exceptionally well. Our Plutonomy Basket, generated returns of 17.8% per
annum, on average, from 1985. If Plutonomy continues, which we think it will, if
income inequality is allowed to persist and widen, the plutonomy basket should continue
to do very well

RISKS: WHAT COULD GO WRONG?
Our whole plutonomy thesis is based on the idea that the rich will keep getting richer. This thesis is not without its risks. For example, a policy error leading to asset deflation, would likely damage plutonomy. Furthermore, the rising wealth gap between the rich and poor will probably at some point lead to a political backlash. Whilst the rich are getting a greater share of the wealth, and the poor a lesser share, political enfrachisement remains as was – one person, one vote (in the plutonomies). At some point it is likely that labor will fight back against the rising profit share of the rich and there will be a political backlash against the rising wealth of the rich.

http://www.scribd.com/doc/34641013/Plutonomy

So what do you think, is the US a plutonomy?

The citigroup seems to be against democracy, or at least they see it as a risk to their status quo.

 

[brainstorm]

you have to look at the microphysics of (economic) power. If a large number of people are relatively poor and social-economic mobility is nearly if not totally impossible, the question becomes how do the poor live? How do they sustain themselves? What labor do they perform and what do they consume and how? Do they have access to the means to basic nutrition, health, shelter, etc. and at what cost?

If "plutocracy" means that a wealthy elite control everything, I think any economy would be plutocratic from a certain perspective. After all, where does money come from in socialized economies? Wealthy pay taxes and the government distributes the money in various ways. The government is still a mechanism of money transfer from the wealthy to the rest, causing the rest to be dependent on the wealthy. This in turn creates a political dynamic where the government must cater to the wealth to avoid them relocating to another tax-region. So, even socialized governments cater to the will of the wealthy; which btw is typically focussed on creating a general level of welfare that promotes a sense of security for upper class people.

Look at who is criticizing the "vast gap" between rich and poor in less socialized regions and I believe you will find that it is upper- and upper-middle class people who have attained a level of prosperity where they are free enough economically to think about their general social surroundings as something to invest in. People who worry that their money can't stretch far enough to improve the general social welfare for everyone look for bounded communities (such as welfare states and gated communities) where the standard of living and education for everyone is high enough to prevent civil strife and guilt in the conscience of the controlling elite. The wealthy elite need these bounded paradises so that they can achieve utopia while blaming others for not achieving the same level of utopia outside their privileged regions.

 

[Evo]

This leaked document from Citigroup states that the USA, Uk, and Canada are plutocracies (rule by the wealthy)

You've got a 5 year old opinion piece by a bank's branch in India? Things have changed. Did you know that China just replaced Japan as the world's #2 economy?

Sorry, that's not adequate for a new thread.

Let me know if you come up with a recent valid study.