Elizabeth Warren argues ‘the rich’ hold sufficient political power to ‘rig the system’ in their favor, in order to ‘deliberately’ hollow out the middle class. She generally identifies the rich as wealthy people who run business corporations. She does not tell us what she means by ‘rig the system’, but we know from her speeches that the system refers to interaction between political and economic power.
Let’s consider the foundation of Warren’s claim that the rich have rigged the system. They do not seem to have rigged the Congress, where a majority of anti-rich Democrats hold the House. They do not seem to have rigged the Oval Office, where a pro-tariff president has caused businesses no end of economic problems. They do not seem to have rigged the national security state, which fights endless wars that benefit only defense contractors. They do not seem to have rigged the regulatory state, which continues to investigate, threaten, and try corporations, especially financial corporations. They do not seem to have rigged the police state, which deports everyone it can lay its hands on, including companies’ own employees. They have not rigged state and local governments, which regulate, tax, and control businesses of all sizes.
I would call that a craven state that let fraud occur before its eyes, then rewarded criminals with handouts while millions lost their homes and jobs.
Where does Warren’s claim originate? Does she mention any examples of how a rigged system produces the results in front of us? If I try to imagine a rigged system, I imagine the way our government acted after the 2007-2008 panic, when it rushed to help institutions largely responsible for the bubble that burst. Government had it entirely within its power to withhold taxpayers’ money from companies who deserved to go bankrupt. Yet it did not. I would not call that a rigged system. I would call that a craven state that let fraud occur before its eyes, then rewarded criminals with handouts while millions lost their homes and jobs.
Government exists to prevent fraud, theft, and violent crime. That it fails to do these things does not mean groups or aggregations of wealthy businessmen rig the system to ensure failure. It simply means government serves certain groups of people before it serves others. Warren sees this behavior as evidence the system is rigged. Rigged means to manage “fraudulently so as to produce a result or situation that is advantageous to a particular person.” In competitive arenas of politics and economics, it means system managers decide the outcome of a contest beforehand.
When politicians stir up resentment against the rich, you know what they want. They do not want to help you, or leave you alone.
Failure of government does not occur because groups of string pullers conspire to determine who wins and who loses. It is simply government failure. Yet Warren wants to give this dysfunctional government far more power than it already has. She says enhanced state power is necessary to prevent further victories by the rich, as they operate their rigged system. Governments have long used Warren’s argument to claim more power for themselves. When politicians stir up resentment against the rich, you know why. They do not want to help you, or leave you alone.
As governments become more powerful, wealthy operators become more secure in their theft and fraud. They know the web of moral hazard protects them. Malefactors have no incentive to protect themselves against failure of their fraudulent schemes, as public institutions underwrite their crimes. We saw how the system worked ten years ago. We see how the system works now, as government serves itself, not others.
Elizabeth Warren says she wants to fight for poor people. If she and other democratic socialists want to help poor people, they should protect freedom for everyone, not remove it. More powerful government means less freedom; less freedom eventually means poverty for everyone except those in power. Recall Soviet communism in Moscow, Chinese communism in Beijing, and Panem’s Capitol in The Hunger Games. In those rigged systems, only the rulers eat well.