Martin Luther King once said that America’s welfare system was built around a rigged system of “socialism for the rich and rugged individualism for the poor”. He borrowed the socio-political-economic argument from the 1962 book, The Other America, written by Michael Harrington. The book highlighted the divide between the rich and poor in America, which then as now is the richest country the world has ever known. Richer than even the wealthiest ancient civilizations combined. The Other America described a nation where approximately 25% of the population was living in poverty.
The same is somewhat true today, The Other America still exists although poverty rates have fallen to around 11 percent. Political scientists argue that poverty should not exist in America. But in America, the welfare state is under constant attack. Political scientists such as Professor Richard Wolff argue that American politicians have been bought out by the billionaire class, both left and right. Indeed Democratic and Republican policies often overlap but are sold differently to the voting public. If a UK Conservative wanted to make it as a politician in the USA he/she would be seen as left-wing.
America is becoming a broken idea because the political system is being sold to the highest bidder, it is mirroring the final years of the Roman Republic. America’s billionaire class, often referred to as the oligarchy, benefits from tax cuts and state benefits which are almost always paid for by the working class and the poor. During the Pandemic the US Congress passed the so-called Care’s Act, a stimulus package. It sounds noble but it was a covert operation to give away $4 trillion dollars to the billionaires who fund both parties.
Congress is yet to approve a similar stimulus package for a nation stricken by the Covid-19 Pandemic.
Germany recently approved €1bn of state aid for Tesla to build a Giga Factory to manufacture EV batteries. The aim is to move away from relying on batteries made and supplied by Chinese manufacturers. Yet Tesla is valued at $600bn, an overvaluation for sure. In addition, Elon Musk has a net worth of $185bn which is primarily based on the rise and fall of Tesla and Space X shares. This rise and fall are fueled by the poker-stricken addicts on the stock markets. And the stock markets are nothing more than a rigged system for the rich.
That being said, Tesla can easily afford to pay for the Giga Factory. Elon Musk could even dip into his personal fortune because we are often told he is a risk-taker. However, and to be fair, Musk has got a good track record of paying back state aid, and if he does, the local community as a whole would benefit. Meaning the trickle-down economics argued by the cheerleaders of the billionaire class could, for once, actually work out. But he should not be begging for state aid in the first place. Let’s see what happens.