The Pros and Cons of a Plutocracy

A plutocracy is a system where wealth is the primary determinant of power and influence. In other words, the rich rule. Like all forms of governance, plutocracy has both supporters and detractors. While it’s rarely advocated for as an ideal system, various degrees of plutocratic influence can be observed in many democracies and political systems worldwide.

If you think we, in the US, are not dealing with plutocracy, then you are living in a dream world and ignoring it.

Here are some stats for 2023 from millenialmoney.com:

· There are approximately 22 million millionaires in the US and 724 billionaires.

· The majority of the US Millionaires are 60–79 years old.

· In 2022, 88% of the US Billionaires were male.

· 40% of the Millionaires live in the US, 11% in China, 6% in Japan and 5% in the UK.

· The number of Millionaires in the US has increased yearly since 2009.

Having had discussions with several people in these groups, I know that they want to have their opinions recognized and action taken to preserve what they have, so it is not uncommon that they will influence many areas of society from local to federal levels. That is Plutocracy.

Here are some of the main pros and cons associated with a plutocracy:

Pros:

· Economic Efficiency: Those with significant wealth usually acquire it through business acumen, investments, or inheritance. They can make economically sound decisions, leading to potential economic growth if they see a benefit in their favor.

· Stability: Plutocracies can be more resistant to populist movements that may lead to radical and sometimes unstable changes. The wealthy elite may prioritize long-term stability over short-term gains. While this is true, there is a tipping point where this is no longer a positive element, and I believe we are approaching that tipping point.

· Expertise and Experience: Wealthy individuals often have access to better education and experience managing large organizations or assets. It could translate to effective governance. However, it does not guarantee they have common sense, as seen in the political and business arenas in the last five years.

· Self-interest Aligns with Public Interest: Some argue that the wealthy are vested in maintaining a stable and prospering society, as their fortunes are tied to health. Again, in principle, this is true. However, too many offer lip service to the greater good to protect their investments rather than sharing, as indicated in the press.

· Reduced Political Bickering: With fewer groups vying for power, there can be more consistent policy-making. Yes, but the last five years have shown that the rank-and-file population has had to watch the wealthy bicker amongst themselves and endure the onslaught of ultra-conservative laws and policies being created that protect their point of view.

Cons:

· Inequality: One of the primary criticisms of plutocracy is that it leads to vast wealth and power inequalities, which can create social unrest. For example, CEO pay has been scrutinized in the last two years, with numbers floating around 344–351% higher than average workers’ pay. Now, I will point out that much of the assets recorded are stocks and other perks, not cash. However, at some point, it is all convertible to cash.

· Lack of Representation: In a true plutocracy, the majority’s interests might not be represented, leading to policies that benefit only a tiny elite. In today’s environment, finding any young person of any nationality willing to run for office is impossible due to the high funds necessary. Also, there is an unwillingness to cater to anyone who wants to garner favors for supporting them or the refusal to expose themselves and their families to the negative, often untrue press that wealthy opponents publish.

· Short-termism: While the wealthy might be interested in societal stability, they might also prioritize policies that boost their wealth in the short term, to the detriment of long-term societal well-being. This issue has pushed into everyone’s lives, not just the wealthy. We have become a population that demands instant gratification and flexibility. Waiting for something is not in our vocabulary.

· A barrier to Social Mobility: In a plutocratic system, the chances of an average individual rising to a position of influence are significantly curtailed. This lack can be evidenced by the few average people running for office locally or federally. Even the number of internal people promoted to an executive in any company.

· Undue Influence: Plutocracies can result in the wealthy having disproportionate influence over policies, even in systems that are nominally democratic. That says it all, particularly over the last five years in the US.

· Erosion of Democratic Values: Over time, the interests of the wealthy may overshadow the foundational principles of democracy, such as equality, representation, and freedom. Today, this issue is part of wealthy interests but also other highly influential groups that muster social media to provide biased, corrupt, inaccurate information to push their agendas.

· Potential for Corruption: With so much power concentrated in the hands of a few, there’s a heightened risk for corrupt practices. Narcissism and pride are the two most potent stepping stones to corruption, and they can occur when wealth is cultivated and retention is paramount.

· Lack of Diverse Perspectives: Decisions made by a small, wealthy elite might lack diverse perspectives from a broader population. It is disappointing that a nation built on the backs of various immigrants has become so polarized over diversity. The lack of diversity in business can be seen in every area: gender, race, disability, and even age. However, it is not just restricted to the leadership of a company. The average worker has developed unhealthy expectations and an unwillingness to embrace diversity and inclusion.

In conclusion, while a plutocracy might offer particular efficiencies and stability derived from economic expertise, it poses significant risks to democratic values, social equity, and representation.

The extent to which a society embraces or resists plutocratic influences depends on its citizens’ values, priorities, and vigilance. The key is how many individuals know, understand, and practice their values, principles, and integrity daily.

Today, many of us are unwilling to deal with the greys between black and white, much less understand the thin line between ethical and unethical. This is before we cross the line between illegal and criminal. Some of this is cultural, and some personal, so there is no quick, easy answer, only hard work, transparency, honesty, and integrity to keep a steady keel.

It boils down to the choices we make every day and whether we choose to control our biases and opinions and search out truth and facts. While I am optimistic, there is always a bit of skepticism in the back of my brain each day as I observe how we deal with the uncertainty and chaos that life has become.