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Well, it is, at least it is not something that I myself would want to do. But that is just me. But I can tell you all something that is important; there are many crafty, clever, and evil people who follow this rule to the letter.
I can include an ex-business partner who only wanted to get into my wife’s pants (or skirt), a couple of work colleagues who would perform run-arounds to disparage me in their pursuit for career growth, and a couple of family members that have an unsavory two-faced attitude about life.
So to best prepare you for these individuals, you must understand how they think and how their ModusOperandi works.
Thus this article…
LAW 14
POSE AS A FRIEND, WORK AS A SPY
JUDGMENT
Knowing about your rival is critical. Use spies to gather valuable information that will keep you a step ahead. Better still: Play the spy yourself. In polite social encounters, learn to probe. Ask indirect questions to get people to reveal their weaknesses and intentions. There is no occasion that is not an opportunity for artful spying.
OBSERVANCE OF THE LAW
Joseph Duveen was undoubtedly the greatest art dealer of his time—from 1904 to 1940 he almost single-handedly monopolized America’s millionaire art-collecting market. But one prize plum eluded him: the industrialist Andrew Mellon. Before he died, Duveen was determined to make Mellon a client.
Duveen’s friends said this was an impossible dream.
Mellon was a stiff, taciturn man.
The stories he had heard about the congenial, talkative Duveen rubbed him the wrong way—he had made it clear he had no desire to meet the man.
Yet Duveen told his doubting friends, “Not only will Mellon buy from me but he will buy only from me.”
For several years he tracked his prey, learning the man’s habits, tastes, phobias.
To do this, he secretly put several of Mellon’s staff on his own payroll, worming valuable information out of them.
By the time he moved into action, he knew Mellon about as well as Mellon’s wife did.
In 1921 Mellon was visiting London, and staying in a palatial suite on the third floor of Claridge’s Hotel.
Duveen booked himself into the suite just below Mellon’s, on the second floor.
He had arranged for his valet to befriend Mellon’s valet, and on the fateful day he had chosen to make his move, Mellon’s valet told Duveen’s valet, who told Duveen, that he had just helped Mellon on with his overcoat, and that the industrialist was making his way down the corridor to ring for the lift.
Duveen’s valet hurriedly helped Duveen with his own overcoat.
Seconds later, Duveen entered the lift, and lo and behold, there was Mellon.
“How do you do, Mr. Mellon?” said Duveen, introducing himself. “I am on my way to the National Gallery to look at some pictures.”
How uncanny—that was precisely where Mellon was headed.
And so Duveen was able to accompany his prey to the one location that would ensure his success.
He knew Mellon’s taste inside and out, and while the two men wandered through the museum, he dazzled the magnate with his knowledge.
Once again quite uncannily, they seemed to have remarkably similar tastes.
Mellon was pleasantly surprised: This was not the Duveen he had expected.
The man was charming and agreeable, and clearly had exquisite taste.
When they returned to New York, Mellon visited Duveen’s exclusive gallery and fell in love with the collection.
Everything, surprisingly enough, seemed to be precisely the kind of work he wanted to collect.
For the rest of his life he was Duveen’s best and most generous client.
Interpretation
A man as ambitious and competitive as Joseph Duveen left nothing to chance.
What’s the point of winging it, of just hoping you may be able to charm this or that client?
It’s like shooting ducks blindfolded.
Arm yourself with a little knowledge and your aim improves.
Mellon was the most spectacular of Duveen’s catches, but he spied on many a millionaire.
By secretly putting members of his clients’ household staffs on his own payroll, he would gain constant access to valuable information about their masters’ comings and goings, changes in taste, and other such tidbits of information that would put him a step ahead.
A rival of Duveen’s who wanted to make Henry Frick a client noticed that whenever he visited this wealthy New Yorker, Duveen was there before him, as if he had a sixth sense.
To other dealers Duveen seemed to be everywhere, and to know everything before they did.
His powers discouraged and disheartened them, until many simply gave up going after the wealthy clients who could make a dealer rich.
Such is the power of artful spying: It makes you seem all-powerful, clairvoyant.
Your knowledge of your mark can also make you seem charming, so well can you anticipate his desires.
No one sees the source of your power, and what they cannot see they cannot fight.
Rulers see through spies, as cows through smell, Brahmins through scriptures and the rest of the people through their normal eyes.
Kautilya, Indian philosopher third century B. C.
KEYS TO POWER
In the realm of power, your goal is a degree of control over future events. Part of the problem you face, then, is that people won’t tell you all their thoughts, emotions, and plans.
Controlling what they say, they often keep the most critical parts of their character hidden—their weaknesses, ulterior motives, obsessions.
The result is that you cannot predict their moves, and are constantly in the dark.
The trick is to find a way to probe them, to find out their secrets and hidden intentions, without letting them know what you are up to.
This is not as difficult as you might think.
A friendly front will let you secretly gather information on friends and enemies alike.
Let others consult the horoscope, or read tarot cards: You have more concrete means of seeing into the future.
The most common way of spying is to use other people, as Duveen did. The method is simple, powerful, but risky: You will certainly gather information, but you have little control over the people who are doing the work.
Perhaps they will ineptly reveal your spying, or even secretly turn against you.
It is far better to be the spy yourself, to pose as a friend while secretly gathering information.
The French politician Talleyrand was one of the greatest practitioners of this art.
He had an uncanny ability to worm secrets out of people in polite conversation.
A contemporary of his, Baron de Vitrolles, wrote,
“Wit and grace marked his conversation. He possessed the art of concealing his thoughts or his malice beneath a transparent veil of insinuations, words that imply something more than they express. Only when necessary did he inject his own personality.”
The key here is Talleyrand’s ability to suppress himself in the conversation, to make others talk endlessly about themselves and inadvertently reveal their intentions and plans.
Throughout Talleyrand’s life, people said he was a superb conversationalist—yet he actually said very little.
He never talked about his own ideas; he got others to reveal theirs.
He would organize friendly games of charades for foreign diplomats, social gatherings where, however, he would carefully weigh their words, cajole confidences out of them, and gather information invaluable to his work as France’s foreign minister.
At the Congress of Vienna (1814-1815) he did his spying in other ways: He would blurt out what seemed to be a secret (actually something he had made up), then watch his listeners’ reactions.
He might tell a gathering of diplomats, for instance, that a reliable source had revealed to him that the czar of Russia was planning to arrest his top general for treason.
By watching the diplomats’ reactions to this made-up story, he would know which ones were most excited by the weakening of the Russian army—perhaps their governments had designs on Russia?
As Baron von Stetten said, “Monsieur Talleyrand fires a pistol into the air to see who will jump out the window.”
If you have reason to suspect that a person is telling you a lie, look as though you believed every word he said. This will give him courage to go on; he will become more vehement in his assertions, and in the end betray himself. Again, if you perceive that a person is trying to conceal something from you, but with only partial success, look as though you did not believe him. The opposition on your part will provoke him into leading out his reserve of truth and bringing the whole force of it to bear upon your incredulity.
ARTHUR SCHOPENHAUER, 1788-1860
During social gatherings and innocuous encounters, pay attention.
This is when people’s guards are down.
By suppressing your own personality, you can make them reveal things.
The brilliance of the maneuver is that they will mistake your interest in them for friendship, so that you not only learn, you make allies.
Nevertheless, you should practice this tactic with caution and care.
If people begin to suspect you are worming secrets out of them under the cover of conversation, they will strictly avoid you.
Emphasize friendly chatter, not valuable information.
Your search for gems of information cannot be too obvious, or your probing questions will reveal more about yourself and your intentions than about the information you hope to find.
A trick to try in spying comes from La Rochefoucauld, who wrote,
“Sincerity is found in very few men, and is often the cleverest of ruses— one is sincere in order to draw out the confidence and secrets of the other.”
By pretending to bare your heart to another person, in other words, you make them more likely to reveal their own secrets.
Give them a false confession and they will give you a real one.
Another trick was identified by the philosopher Arthur Schopenhauer, who suggested vehemently contradicting people you’re in conversation with as a way of irritating them, stirring them up so that they lose some of the control over their words.
In their emotional reaction they will reveal all kinds of truths about themselves, truths you can later use against them.
Another method of indirect spying is to test people, to lay little traps that make them reveal things about themselves.
Chosroes II, a notoriously clever seventh-century king of the Persians, had many ways of seeing through his subjects without raising suspicion.
If he noticed, for instance, that two of his courtiers had become particularly friendly, he would call one of them aside and say he had information that the other was a traitor, and would soon be killed.
The king would tell the courtier he trusted him more than anyone, and that he must keep this information secret.
Then he would watch the two men carefully.
If he saw that the second courtier had not changed in his behavior toward the king, he would conclude that the first courtier had kept the secret, and he would quickly promote the man, later taking him aside to confess,
“I meant to kill your friend because of certain information that had reached me, but, when I investigated the matter, I found it was untrue.”
If, on the other hand, the second courtier started to avoid the king, acting aloof and tense, Chosroes would know that the secret had been revealed.
He would ban the second courtier from his court, letting him know that the whole business had only been a test, but that even though the man had done nothing wrong, he could no longer trust him.
The first courtier, however, had revealed a secret, and him Chosroes would ban from his entire kingdom.
It may seem an odd form of spying that reveals not empirical information but a person’s character.
Often, however, it is the best way of solving problems before they arise.
By tempting people into certain acts, you learn about their loyalty, their honesty, and so on.
And this kind of knowledge is often the most valuable of all: Armed with it, you can predict their actions in the future.
Image:
The Third Eye of the Spy. In the land of
the two-eyed, the third eye gives you the omniscience
of a god. You see further than others, and you see deeper into them. Nobody is
safe from the eye but you.
Authority:
Now, the reason a brilliant sovereign and a wise general conquer the enemy whenever they move, and their achievements surpass those of ordinary men, is their foreknowledge of the enemy situation. This “foreknowledge” cannot be elicited from spirits, nor from gods, nor by analogy with past events, nor by astrologic calculations. It must be obtained from men who know the enemy situation—from spies.
(Sun-tzu, The Art of War, fourth century B.C.)
REVERSAL
Information is critical to power, but just as you spy on other people, you must be prepared for them to spy on you.
One of the most potent weapons in the battle for information, then, is giving out false information.
As Winston Churchill said,
“Truth is so precious that she should always be attended by a bodyguard of lies.”
You must surround yourself with such a bodyguard, so that your truth cannot be penetrated.
By planting the information of your choice, you control the game.
…
In 1944 the Nazis’ rocket-bomb attacks on London suddenly escalated.
Over two thousand V-1 flying bombs fell on the city, killing more than five thousand people and wounding many more.
Somehow, however, the Germans consistently missed their targets.
Bombs that were intended for Tower Bridge, or Piccadilly, would fall well short of the city, landing in the less populated suburbs.
This was because, in fixing their targets, the Germans relied on secret agents they had planted in England.
They did not know that these agents had been discovered, and that in their place, English-controlled agents were feeding them subtly deceptive information.
The bombs would hit farther and farther from their targets every time they fell.
By the end of the campaign they were landing on cows in the country.
By feeding people wrong information, then, you gain a potent advantage.
While spying gives you a third eye, disinformation puts out one of your enemy’s eyes.
A cyclops, he always misses his target.
Conclusion
Do not be a fake friend. What ever advantage that it might provide to you, will be offset by an equal degradation in your other relationships.
Don’t do it.
Do you want more?
I have more posts in my “48 Laws of Power” Index here…
You’ll not find any big banners or popups here talking about cookies and privacy notices. There are no ads on this site (aside from the hosting ads – a necessary evil). Functionally and fundamentally, I just don’t make money off of this blog. It is NOT monetized. Finally, I don’t track you because I just don’t care to.
Here is another law from the 48 laws of power by Robert Greene. This is Law 7. Get others to do the work for you. We can see how this law is practiced throughout the United States. Steve Jobs. Bill Gates. Jeff Bezos. Eric Schmidt. Donald Trump. Can you name their “right hand men”? I’ll bet you cannot. For they are the figurehead and they get all the credit for the system that they are part of.
LAW 7
GET OTHERS TO DO THE WORK FOR YOU, BUT ALWAYS TAKE THE CREDIT
JUDGMENT
Use the wisdom, knowledge, and legwork of other people to further your own cause. Not only will such assistance save you valuable time and energy, it will give you a godlike aura of efficiency and speed. In the end your helpers will be forgotten and you will be remembered. Never do yourself what others can do for you.
TRANSGRESSION AND OBSERVANCE OF THE LAW
In 1883 a young Serbian scientist named Nikola Tesla was working for the European division of the Continental Edison Company. He was a brilliant inventor, and Charles Batchelor, a plant manager and a personal friend of Thomas Edison, persuaded him he should seek his fortune in America, giving him a letter of introduction to Edison himself. So began a life of woe and tribulation that lasted until Tesla’s death.
IIII TORTOISE THE LELP AND THE HIPPOPOI
One day the tortoise met the elephant, who trumpeted, “Out of my way, you weakling—I might step on you!” The tortoise was not afraid and stayed where he was, so the elephant stepped on him, but could not crush him. “Do not boast, Mr. Elephant, I am as strong as you are!” said the tortoise, but the elephant just laughed. So the tortoise asked him to come to his hill the next morning. The next day, before sunrise, the tortoise ran down the hill to the river, where he met the hippopotamus, who was just on his way back into the water after his nocturnal feeding. “Mr Hippo! Shall we have a tug-of-war? I bet I’m as strong as you are!” said the tortoise. The hippopotamus laughed at this ridiculous idea, but agreed. The tortoise produced a long rope and told the hippo to hold it in his mouth until the tortoise shouted “Hey!” Then the tortoise ran back up the hill where he found the elephant, who was getting impatient. He gave the elephant the other end of the rope and said, “When I say ‘Hey!’ pull, and you’ll see which of us is the strongest. ”Then he ran halfway back down the hill, to a place where he couldn’t be seen, and shouted, “Hey!” The elephant and the hippopotamus pulled and pulled, but neither could budge the other-they were of equal strength. They both agreed that the tortoise was as strong as they were. Never do what others can do for you. The tortoise let others do the work for him while he got the credit.
-ZAIREAN FABLE
When Tesla met Edison in New York, the famous inventor hired him on the spot. Tesla worked eighteen-hour days, finding ways to improve the primitive Edison dynamos. Finally he offered to redesign them completely.
To Edison this seemed a monumental task that could last years without paying off, but he told Tesla, “There’s fifty thousand dollars in it for you— if you can do it.”
Tesla labored day and night on the project and after only a year he produced a greatly improved version of the dynamo, complete with automatic controls. He went to Edison to break the good news and receive his $50,000.
Edison was pleased with the improvement, for which he and his company would take credit, but when it came to the issue of the money he told the young Serb, “Tesla, you don’t understand our American humor!,” and offered a small raise instead.
Tesla’s obsession was to create an alternating-current system (AC) of electricity. Edison believed in the direct-current system (DC), and not only refused to support Tesla’s research but later did all he could to sabotage him.
Tesla turned to the great Pittsburgh magnate George Westinghouse, who had started his own electricity company.
Westinghouse completely funded Tesla’s research and offered him a generous royalty agreement on future profits. The AC system Tesla developed is still the standard today— but after patents were filed in his name, other scientists came forward to take credit for the invention, claiming that they had laid the groundwork for him. His name was lost in the shuffle, and the public came to associate the invention with Westinghouse himself.
A year later, Westinghouse was caught in a takeover bid from J. Pierpont Morgan, who made him rescind the generous royalty contract he had signed with Tesla.
Westinghouse explained to the scientist that his company would not survive if it had to pay him his full royalties; he persuaded Tesla to accept a buyout of his patents for $216,000—a large sum, no doubt, but far less than the $12 million they were worth at the time.
The financiers had divested Tesla of the riches, the patents, and essentially the credit for the greatest invention of his career.
The name of Guglielmo Marconi is forever linked with the invention of radio. But few know that in producing his invention—he broadcast a signal across the English Channel in 1899—Marconi made use of a patent Tesla had filed in 1897, and that his work depended on Tesla’s research.
Once again Tesla received no money and no credit. Tesla invented an induction motor as well as the AC power system, and he is the real “father of radio.” Yet none of these discoveries bear his name.
As an old man, he lived in poverty.
In 1917, during his later impoverished years, Tesla was told he was to receive the Edison Medal of the American Institute of Electrical Engineers. He turned the medal down. “You propose,” he said, “to honor me with a medal which I could pin upon my coat and strut for a vain hour before the members of your Institute.
You would decorate my body and continue to let starve, for failure to supply recognition, my mind and its creative products, which have supplied the foundation upon which the major portion of your Institute exists.”
Interpretation
Many harbor the illusion that science, dealing with facts as it does, is beyond the petty rivalries that trouble the rest of the world.
Nikola Tesla was one of those.
He believed science had nothing to do with politics, and claimed not to care for fame and riches. As he grew older, though, this ruined his scientific work. Not associated with any particular discovery, he could attract no investors to his many ideas. While he pondered great inventions for the future, others stole the patents he had already developed and got the glory for themselves.
He wanted to do everything on his own, but merely exhausted and impoverished himself in the process.
Edison was Tesla’s polar opposite.
He wasn’t actually much of a scientific thinker or inventor; he once said that he had no need to be a mathematician because he could always hire one. That was Edison’s main method.
He was really a businessman and publicist, spotting the trends and the opportunities that were out there, then hiring the best in the field to do the work for him. If he had to he would steal from his competitors. Yet his name is much better known than Tesla’s, and is associated with more inventions.
To be sure, if the hunter relies on the security of the carriage, utilizes the legs of the six horses, and makes Wang Liang hold their reins, then he will not tire himself and will find it easy to overtake swift animals. Now supposing he discarded the advantage of the carriage, gave up the useful legs of the horses and the skill of Wang Liang, and alighted to run after the animals, then even though his legs were as quick as Lou Chi’s, he would not be in time to overtake the animals. In fact, if good horses and strong carriages are taken into use, then mere bond-men and bondwomen will be good enough to catch the animals.
-HAN-FEI-TZU, CHINESE PHILOSOPHER, THIRD CENTURY B.C.
The lesson is twofold:
First, the credit for an invention or creation is as important, if not more important, than the invention itself. You must secure the credit for yourself and keep others from stealing it away, or from piggy- backing on your hard work. To accomplish this you must always be vigilant and ruthless, keeping your creation quiet until you can be sure there are no vultures circling overhead.
Second, learn to take advantage of other people’s work to further your own cause. Time is precious and life is short. If you try to do it all on your own, you run yourself ragged, waste energy, and burn yourself out. It is far better to conserve your forces, pounce on the work others have done, and find a way to make it your own.
Everybody steals in commerce and industry. I’ve stolen a lot myself. But I know how to steal.
-Thomas Edison, 1847-1931
KEYS TO POWER
The world of power has the dynamics of the jungle:
There are those who live by hunting and killing, and there are also vast numbers of creatures (hyenas, vultures) who live off the hunting of others. These latter, less imaginative types are often incapable of doing the work that is essential for the creation of power.
They understand early on, though, that if they wait long enough, they can always find another animal to do the work for them.
Do not be naive: At this very moment, while you are slaving away on some project, there are vultures circling above trying to figure out a way to survive and even thrive off your creativity. It is useless to complain about this, or to wear yourself ragged with bitterness, as Tesla did.
Better to protect yourself and join the game. Once you have established a power base, become a vulture yourself, and save yourself a lot of time and energy.
A hen who had lost her sight, and was accustomed to scratching up the earth in search of food, although blind, still continued to scratch away most diligently. Of what use was it to the industriuus fool? Another sharp-sighted hen who spared her tender feet never moved from her side, and enjoyed, without scratching, the fruit of the other’s labor. For as often as the blind hen scratched up a barley-corn, her watchful companion devoured it.
-FABLES, GOITCHOLD LESSING, 1729-1781
Of the two poles of this game, one can be illustrated by the example of the explorer Vasco Núñez de Balboa. Balboa had an obsession—the discovery of El Dorado, a legendary city of vast riches.
Early in the sixteenth century, after countless hardships and brushes with death, he found evidence of a great and wealthy empire to the south of Mexico, in present-day Peru.
By conquering this empire, the Incan, and seizing its gold, he would make himself the next Cortés. The problem was that even as he made this discovery, word of it spread among hundreds of other conquistadors. He did not understand that half the game was keeping it quiet, and carefully watching those around him.
A few years after he discovered the location of the Incan empire, a soldier in his own army, Francisco Pizarro, helped to get him beheaded for treason. Pizarro went on to take what Balboa had spent so many years trying to find.
The other pole is that of the artist Peter Paul Rubens, who, late in his career, found himself deluged with requests for paintings.
He created a system: In his large studio he employed dozens of outstanding painters, one specializing in robes, another in backgrounds, and so on. He created a vast production line in which a large number of canvases would be worked on at the same time. When an important client visited the studio, Rubens would shoo his hired painters out for the day. While the client watched from a balcony, Rubens would work at an incredible pace, with unbelievable energy. The client would leave in awe of this prodigious man, who could paint so many masterpieces in so short a time.
This is the essence of the Law: Learn to get others to do the work for you while you take the credit, and you appear to be of godlike strength and power.
If you think it important to do all the work yourself, you will never get far, and you will suffer the fate of the Balboas and Teslas of the world.
Find people with the skills and creativity you lack.
Either hire them, while putting your own name on top of theirs, or find a way to take their work and make it your own. Their creativity thus becomes yours, and you seem a genius to the world.
There is another application of this law that does not require the parasitic use of your contemporaries’ labor: Use the past, a vast storehouse of knowledge and wisdom.
Isaac Newton called this “standing on the shoulders of giants.”
He meant that in making his discoveries he had built on the achievements of others. A great part of his aura of genius, he knew, was attributable to his shrewd ability to make the most of the insights of ancient, medieval, and Renaissance scientists.
Shakespeare borrowed plots, characterizations, and even dialogue from Plutarch, among other writers, for he knew that nobody surpassed Plutarch in the writing of subtle psychology and witty quotes. How many later writers have in their turn borrowed from—plagiarized—Shakespeare ?
We all know how few of today’s politicians write their own speeches.
Their own words would not win them a single vote; their eloquence and wit, whatever there is of it, they owe to a speech writer. Other people do the work, they take the credit. The upside of this is that it is a kind of power that is available to everyone. Learn to use the knowledge of the past and you will look like a genius, even when you are really just a clever borrower.
Writers who have delved into human nature, ancient masters of strategy, historians of human stupidity and folly, kings and queens who have learned the hard way how to handle the burdens of power—their knowledge is gathering dust, waiting for you to come and stand on their shoulders.
Their wit can be your wit, their skill can be your skill, and they will never come around to tell people how unoriginal you really are.
You can slog through life, making endless mistakes, wasting time and energy trying to do things from your own experience. Or you can use the armies of the past. As Bismarck once said, “Fools say that they learn by experience. I prefer to profit by others’ experience.”
Image: The Vulture. Of all the creatures in the jungle, he has it the easiest. The hard work of others becomes his work; their failure to survive becomes his nourishment. Keep an eye on the Vulture—while you are hard at work, he is cir cling above. Do not fight him, join him.
Authority: There is much to be known, life is short, and life is not life without knowledge. It is therefore an excellent device to acquire knowledge from everybody. Thus, by the sweat of another’s brow, you win the reputation of being an oracle. (Baltasar Gracián, 1601-1658)
REVERSAL
There are times when taking the credit for work that others have done is not the wise course: If your power is not firmly enough established, you will seem to be pushing people out of the limelight. To be a brilliant ex ploiter of talent your position must be unshakable, or you will be accused of deception.
Be sure you know when letting other people share the credit serves your purpose. It is especially important to not be greedy when you have a master above you. President Richard Nixon’s historic visit to the People’s Republic of China was originally his idea, but it might never have come off but for the deft diplomacy of Henry Kissinger. Nor would it have been as successful without Kissinger’s skills. Still, when the time came to take credit, Kissinger adroitly let Nixon take the lion’s share. Knowing that the truth would come out later, he was careful not to jeopardize his standing in the short term by hogging the limelight. Kissinger played the game expertly: He took credit for the work of those below him while graciously giving credit for his own labors to those above. That is the way to play the game.
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If you ever have the misfortune to read the comment sections of the social media on the internet, you will discover that 99% of American do not know what the United States is. Some say that it is a “Republic”. While others say that it is a “Democracy”. There are reasons why people use these terms, but they are all wrong. Today, the United States behaves functionally as an Oligarchy. And this post will prove it.
Now, you the reader might ask, why is this important?
Well, it is very important for the very simple reason that oligarchies do not last. They never last, and when they collapse it is often catastrophically.
Thus to fully appreciate what this post is saying, you need to recognize that no one can live on “borrowed time” for long. Eventually, everyone “must pay the dues” that accrue. This was true back three thousand years ago and it is true right now.
This post was written in January 2020, right before the COVID-19 coronavirus forced China to go into a full military DEFCON ONE lock-down, and right before the economic collapse of the United States in early March 2020.
The following is a reprint of an article titled “Oligarchy in America: How the 0.1% Rob Everyone Else Blind – 31 Shocking Data Points” with a sub-title that says “The rich are getting richer, and everyone else is getting poorer” . It was written by Jon Hellevig on Friday 17JAN20. It was edited to fit this venue, but aside from that, no other changes were made. All credit to the author and original editors.
The rich are getting richer, and everyone else is getting poorer.
There is no hiding anymore, the United States has become an
oligarch owned banana republic with nukes, and with a monopoly currency
which has allowed it to rig the markets for half a century. But now we
are only a couple of hours from curtain – Midnight in America.
With the stock market at all-time highs, virtually no unemployment (or so they say), and brisk GDP growth (supposedly) in the last decade, economic analysts would declare that the US economy is in excellent shape.
This was written just before the United States collapsed economically in March 2020.
But, it isn’t in “excellent shape”.
The stock market is a central bank inflated asset bubble, and what GDP growth there has been, is an illusion brought about by the very same financial bubble and by pumping the economy up with record federal borrowings to finance the deficits that America cannot afford.
Rigged statistics showing artificially low inflation serve to hold together the Trumped-up American economic narrative. (About the rigged inflation statistics, see this report). And the low unemployment figure is nothing but a chimera based on misleading.
The US Economy is failing
Actually, as of 20MAY20, it has failed. And people are now considering just how far it will collapse. Even the most optimistic are thinking in terms of months. When the reality might very well be decades.
In
reality, the US economy is failing – and the country with it. At least
two-thirds of the population has seen dramatic declines in living
standards and half are back to levels of developing nations – without
the development.
People are turning into impoverished serfs.
The big story covered up by all the happy macroeconomic figures repeated by rote by the US establishment – everybody from the president to cable television pundits and Trump fanboys – is the gradual impoverishment of the American worker.
In the early 1970’s, the wages of workers stopped matching the rise in productivity. Now, the rise in productivity was necessary to meet investor dividends. As inflation was eating away at profits. Thus, the only area where the costs to make things were cut were in employee wages. Thus, for most workers, inflation-adjusted wages were frozen at 1970 levels.
That’s an inconvenient truth increasingly difficult to hide as the American dream has turned into a nightmare for huge swathes of the population.
The rich are now obscenely wealthy.
As the figures we present below show, the rich are really getting richer, the middle class has been decimated, and half of Americans are poor and destitute of any financial wealth.
Keep in mind that an Oligarchy is rule by the rich. It is in their best interests to have a dual-tiered government and system. One for them, and one for everyone else. Thus, it makes sense that in an oligarchy, the rich get richer, while the poor get poorer.
The super-rich are gobbling up an ever-increasing slice of the American pie at the cost of all the rest who get nothing but table scraps on one side and leftover crumbs on the other, if anything.
The rich are getting richer. The poor are getting poorer, and gap between both is getting bigger and bigger.
The resulting stratification of society has brought back a medieval servant economy, where the have-nots are doing odd jobs, cleaning houses, fetching groceries, running errands and deliveries for the feudal rich and the remaining shrinking middle class.
Thanks to the Fed (the American oligarch owned central bank) pushing easy money into the hands of the privileged elite…
… now the super-rich Dismal Decimal – the top 0.1% – …
…have by now amassed as much wealth as they had just before the Great Depression. A depression that started with the stock market crash in 1929.
A lesson not learned.
Back to square one. How will it end this time?
Information Data Source
This article is based on an Awara Accounting study titled “Widening Income and Wealth Gap and Stagnating Wages in America.” Links and source references to all the facts presented here can be found in said study.
BTW all the data in this report is derived from official US government sources and American experts analyzing them.
Just how the Oligarchy has rigged the game against the citizens…
During the last decades, the financial rewards from the rigged markets first flew exclusively into the pockets of Top 10%, but later it was increasingly Top 1%, which pocketed most, perfectly illustrated by the charts below.
1. Income for the rich just accelerates upward.
The income of Top 1% has grown five times as fast as that of Bottom 90% income since 1970, who now earn double the amount of income than 160 million poor of the lower 50% stratum.
The income of Top 1% has grown five times as fast as that of Bottom 90% income since 1970.
The fortunes of Top 1% and Bottom 50% are now reversed.
The fortunes of Top 1% and Bottom 50% are now reversed.
2. The rich now own almost all the available money.
Top 1% now holds as much wealth as Bottom 50% combined.
Income inequality obviously leads to wealth inequality, but here the figures are yet more striking in showing the magnitudes of the grab at the top. Since 1989, Top 1% captured $21 trillion in wealth, while Bottom 50% lost $900 billion, actually pushing them down to negative wealth, meaning they have more debt than they have assets.
On a net analysis, half of Americans own nothing of real value.
On a net analysis, half of Americans own nothing of real value.
Until the creeping coup under Reagan, income equality was improving
It was bad enough in 1995 when Top 1% earned as much as Bottom 50%,
but today the richest 1% already take 20% of all income leaving the
bottom half with only 12%. As the chart shows, back in 1978 – before the
neoliberal creeping coup really got going – the trends were reversed.
Below chart compares income growth since 1920 of Top 1% to Bottom 90%
(that is, all the rest except Top 10%). We see that right after Ronald
Reagan entered the presidency with his Chicago School snake oil
influenced backers, the income growth of the 1% started its dizzying
growth, which is continuing to this date.
Up until around 1982 the income growth for the top 1% of earners was rather flat. But after President Reagan, it accelerated dramatically.
Money isn't the only system being used to isolate the oligarchy from the common people.
"Phoenix is the conceptual model for the DHS (US equivalent of RSHA under the NSDAP- my note). Both are based on the principle that governments can manage societies through implicit and explicit terror. The strategic goal is to widen the gap between the elites and the mass of the citizenry, while expunging anyone who cannot be ideologically assimilated."
-Dr. T. P. Wilkinson
Back in 1962, the share of Top 1% of America’s wealth at 33% was equal to that of Bottom 90%, but in the early 1980s the share of Bottom 90% started a steep descent and by 2016 their share had dwindled down to 21%.
Especially after the Federal Reserve shifted its market rigging low-interest-rate money-pumping policy into high gear from the beginning of 2000s, the superrich have experienced a massive rise in their fortunes, as illustrated by below chart.
The Rich became super-rich, while the middle class became poor.
But by today Top 1% are losers compared with Top 0.1% – the Dismal Decimal – who are where the music plays.
5. Top 0.1% now holds as much wealth as Bottom 90% combined.
A recent study revealed that the concentration on the top is yet much more pernicious.
It’s not any more a question of Top 10%, and not even Top 1%, as it is the Top 0.1% – the Dismal Decimal – that has now concentrated the wealth of the nation (and half the world) in their greedy hands.
Top 0.1% now holds as much wealth as Bottom 90% combined.
As the below chart shows, we are essentially back to the Roaring Twenties…a lesson not learned.
Actually, in the aftermath of the Great Depression, America entered an unprecedented era of four decades of prosperity with a more equal distribution of wealth as Bottom 90% recovered strongly in distribution of wealth at the expense of Top 0.1% parasites.
We are essentially back to the Roaring Twenties…a lesson not learned.
6. Top 0.1% earnings grew 347% between 1979 and, while Top 1% “only” gained 157% – the rest gained nothing
Top 0.1% earnings grew 347%
Top 1% earnings grew 157%
The rest 98.9% grew 0%.
The advent of opportunity for most Americans has become a zero-sum game.
7. The share of total income is oligarch in nature.
The next chart takes a longer perspective – while widening the sample to Top 10% – and shows their share of the total income since 1910 to 2010.
The Roaring Twenties – the period before the 1929 stock market crash and the ensuing Great Depression – experienced the same level of glaring inequality as today’s America.
With Franklin D. Roosevelt’s reforms the egregious average income inequality was tamed and stayed relatively low until Reagan’s fatal presidency. And it’s been downhill ever since – or uphill, if we look at it from the perspective of the rich.
The percentage share of the total national income for the top 10%.
8. The GDP
The only economic figure that has managed to look good is the GDP, but that is so only until you bother to find out where it comes from – from the Federal Reserved fueled asset bubble and massive federal budget deficits financed by record national debts.
Thing is that, beyond the richest 10% very few Americans have a stake in the stock market.
In 2016, the richest one percent held more than half of all outstanding stock, financial securities, and all other sorts of equity. The remainder of those asset categories were held by the rest of Top 10%, who owned over 93% of all stock and mutual fund ownership.
What wealth the remaining 90% may own is largely residential housing, the homes where they live.
According to Jonathan Tepper, the wealthiest 1% own nearly 50% of stock and the top 10% more than 81%. The so-called middle class owns only 8% of all stock.
This also kills the myth that record highs on the stock market would be good for American retirement savings – with the richest few holding all the shares there’s nothing in it for the overwhelming majority.
8b. Pension plans.
A recent report also showed that only 10% of Americans are invested in pension plans. That is down from 60% in 1980.
And those who are, are traditionally more weighted towards bonds and money-market instruments, which suffer from the rigged markets with the artificially low interest rates.
The pension savers are hence literally paying for the super gains flowing into the pockets of Top 1%.
On the other hand the super low interest rates are out of grasp for the all but Top 1% who gobble up the wealth of the nation with that largesse delivered to them by their Federal Reserve.
At the same time the common household is paying double-digit rates on their credit card debt traps.
9. Household wages have been stagnant.
Below Top 10% wages and total household income have been stagnant, at best.
10. Stagnation of incomes for the bulk of Americans.
Average income of the bottom 50% has stagnated at around $16,000 since 1980, while the income of the top 1% has skyrocketed by 300% to approximately $1,340,000 in 2014
11. Almost half of Americans are impoverished.
45% of Americans earn annually only 18,000 or less. A recent study found that 53 million Americans or 44% of the working age population earn a median average annual salary of only $18,000. Basically then, at least half of the Americans are working-poor.
12. Zero change in income for the middle class.
Middle-class households had in 2015 basically the same income as they had in 1979
13. Only the rich got richer.
In the two decades from 1997 to 2017, only Top 5% of households saw their income increase
14. Most American wages did not change at all.
For most American workers, real wages have barely budged in decades. By end of 2018, the real inflation-adjusted average wage had about the same purchasing power it did 40 years ago.
15. Minimum wages have not changed.
As the below chart illustrates, the real average hourly wage which was $20.27 in 1964 had only inched up to $22.27. David Stockman calculated that the real hourly worker’s wage was in 2019 still at 1972 levels.
Minimum wages have not changed.
16. Men’s wages at all levels have fallen.
For full-time employed men real wages have fallen 4.4% since 1973, according to economist Paul Craig Roberts. The total average income of men at $51,212 in 2015, was lower in real terms than it had been in 1974.
17. Rise is “gig work”.
As of 2014, the average hours worked per week had fallen from around 39 hours in 1970s to under 34 hours. Economist Mike Shedlock calculated that the actual hours worked and the average hourly earnings would deliver a weekly income of $690, well below its $825 peak back in the early 1970s. If we multiply the hypothetical weekly earnings by 50, we get an annual figure of $35,497. That would in 2014 have translated to a 16.4% decline from its peak in October 1972.
18. All productively benefit has gone to the rich.
All labor productivity growth since the 1970s have gone to the robber capitalists. From 1973 to 2013, hourly compensation of a typical (production/nonsupervisory) worker rose just 9% percent while productivity increased 74%.
Nowhere is income inequality and the egregious worsening trend as manifest as in the case of CEO pay.
In the 1970s, CEOs made 30 times what typical workers made, but by 2017 the CEOs made 361 times the workers’ pay. According to the Economic Policy Institute CEO compensation has grown 940% since 1978, while typical worker compensation has risen only 12% during that time.
The Fed fueled financial market orgy is the main cause for the
windfall riches of CEOs as stock options and the accompanying share
buybacks make up a huge part of CEO pay packages. This rising pay of
executives was the main factor in Top 0.1%’s super grab of household
income
20. Americans struggle for the basics
A 2017 study found that 40% of US adults struggle to pay for basic necessities like food, healthcare, housing, and utilities.
Nearly 70% of Americans have virtually no savings. Bottom 55% have zero savings, while the following 24% – the core of the former middle class – have only $1,000 stashed away.
24. The other side of the (non-existent) coin is that the same 50% of
Americans would obviously struggle to come up with $400 for an
unexpected expense. By extension, the former middle class – those with
the miserly savings of $1,000 – would also have real troubles in coping
with any kind of bill for medical treatment without dipping into more
debt. Considering the above reported findings (see the chart) only the
Top 10% would be financially secure in a medical emergency.
25. According to shocking findings by the American Cancer Society,
137.1 million US residents suffered medical financial hardship in 2018.
Americans had to resort to borrow a total of $88 billion in 2018 only to
cover for essential medical treatment.
26. A third of young adults, or 24 million of those aged 18 to 34,
lived with in their parents’ home because they cannot afford a home of
their own.
27. The income and wealth gap pictures get worse yet when we look at
the age distribution of wealth. Younger generations are earning less and
own next to nothing (that is, if you are not the golden youth of the
10%). Baby Boomers born between the end of the Second World War and 1964
currently hold wealth that is 11 times higher than that of millennials.
Median Income for Younger and Older Families in Inflation-Adjusted Dollars
28. Growth of “real” Jobs is zero.
The number of full-time jobs with life-sustaining wages – what economist David Stockman calls breadwinner jobs – have not been growing since 2000, by 2014 their number was still 3.5 million or 5% lower than it was at the peak in early 2001. In the same period 4 million part-time and gig jobs were created.
While the official unemployment figure is presently near historical lows – and at levels what some economists would like to call full employment – there are some big problems with it.
1. Problems with the official unemployment statistics. The officially touted unemployment figure (so-called U3 unemployment) record only those who have been looking for a job during the last 4 weeks, while discouraged long-term unemployed are cleansed from the statistics and left unrecorded as if they would not be in the workforce at all – makes stats look beautiful for the powers that shouldn’t be.
2. The labor participation rate has been falling.
3. New job creation has amounted to only a third of the annual increase in working age population.
4. Part-time and gig jobs count as full-time employment. Any person who takes a part-time or gig job for just a few hours a month is recorded among the employed, although they would rightly be considered unemployed merely clutching at straws.
5. Connected with the previous point, there is also a more general problem with the quality of jobs created. Most jobs created in the last two decades are low-paid low-skill jobs that do not provide a life-sustaining income considering the cost of living in the United States.
More than one third (36%) of U.S. workers are in the gig economy,
doing part-time work or side hustles for companies like Uber, Lyft,
Etsy, Amazon Mechanical Turk, Freelancer.com, Ebay or just any odd job
they can get from time to time.
29. Debt Peonage.
To make up for the shrinking earnings, the American regime is pushing the American population into 21st century debt peonage.
Ensnared in the debt trap, US households had nearly $14 trillion in outstanding debt at the end of the third quarter 2019. That debt load now equals 73% of GDP. By end of 2019, consumption debt alone (not including asset acquiring mortgages) was up by $2 trillion since 2014.
Since 2004, the weight of the student loan millstone has gone up fivefold from only $250 billion to today’s $1.5 trillion.
That’s due to the huge price inflation in higher education. The cost
of both public and private college escalated by 40% over the general
consumer price inflation between 2005 and 2015.
30. Huge increase in the cost of living in the USA.
We mistakenly believe that the increase in the cost of living is universal around the world. Nope. It isn’t. Only the cost of living in the United States and Zimbabwe have increased exponentially. The rest of the world, not so much.
Because of the huge rise in the last few decades in cost of living in the US, in Russia, you get the same standard of living for a fraction of the American cost. A Moscow average monthly salary equal to $1,600 (annual $19,200) gives the same purchasing power as a monthly salary of $6,000 in Chicago (annual $72,000). Meaning, you live in Moscow (at least as well for a monthly paycheck of $1,600 as you live in Chicago for a paycheck of $6,000.
The present oligarch controlled rigged crony capitalist system has killed the American dream, the belief that anyone, regardless of parents’ social status and incomes can attain success and wealth by hard work and ingenuity.
The gates for upward mobility have been shut for the overwhelming majority.
The monopolization of practically all sectors of the economy, the ever increasing bureaucratic restrictions on doing business, the extreme concentration of ownership, and the rigged financial markets have made it increasingly hard for people outside the top echelon of penetrating the financial membrane protecting the elites.
A 2017 study by the Federal Reserve Bank of Cleveland found that the probability that a household outside the top 10% made it into the highest tier within 10 years was twice as high during 1984-1994 as it was during 2003-2013.
The United States is an oligarchy
This concentration of the income and wealth on the top, proves that the United States is an oligarchy.
With this report showing the insanely widening income and wealth inequality, my aim is to show, that the country is an economic oligarchy, too.
In fact, economic super riches are the precondition for their political power, too.
In America, as always, the oligarchy has achieved their uncontested power in a hermeneutical feedback loop, where the initial wealth of the superrich has bought them increased political power, which has given them increased riches, which has bought them more political power, and so on, until today, when they own practically the whole economy and the entire government.
Clearly the source of higher inequality has been Fed policies, which has pushed cheap money into the pockets of the already rich, who have exclusively then benefited from soaring stock and real estate prices.
Fittingly, we got end of 2019 a report revealing that the world’s
richest people increased their wealth in the year by $1.2 trillion, a
staggering 25%, most of which belong to the oligarchs of the United
States.
Intentional or Accidental?
The question – which I have set to explore in my series of Capitalism in America – is whether there has been a game plan, a long-term strategy or whether intermittent achievements have just spurred the oligarchs on to new economic and political power grabs in the course of establishing their totalitarian rule.
I tend to think, there has been a long-term plan ever since the establishment of the Federal Reserve.
Thank you President Wilson.
The economic and political history of the United States provide so much circumstantial evidence, which supports the view that there has been a conspiracy of the Wall Street elite.
I shall return to this hypothesis in further installments to this series of Capitalism in America.
It is however clear – whether through a long-term plan or by a series of ad hoc interventions – the US financial elite has by now completed a creeping coup, which have delivered them absolute economic and political power.
In my investigation of the oligarchization of America – the creeping
neoliberal oligarch coop, which set in full force since Reagan – I have
so far completed these instalments:
Next due is a fifth report showing how from point of view of political science the oligarchy has destroyed the social fabric of the US economy and deliberately enacted laws that favor the few over the people. Of particular interest here is how the oligarchy has rigged the political system by institutionally solidifying the mendacious Janus- faced two-party system in order to remove any potential challenge to their rule.
Conclusion
Three points;
Point One
There are two classes in the United States; the rich and the poor.
Actually there are nine classes. But for this discussion it's the 0.1% against the 99.9%.
The 9 classes are...
The Oligarchy
The wealthy
The Per Diem
The upper class
The middle class
The Gig class
The low class
The Felon Class
The Sex Offender Class.
The door has slammed shut for most Americans. It is already decided. You are part of one group or the other. The days of being able to leave the “impoverished” and join the ranks of the wealthy are over. It is a fine childhood fantasy, but it will never happen. They best you can do is be slightly better than your peers. That’s all that you can possibly hope for.
Point Two
The United States is stratified by finances. There are two main class groupings of people; the rich and the poor. The government is controlled by the rich, which is a textbook definition of an oligarchy.
oligarchy
noun, plural ol·i·gar·chies.
a form of government in which all power is vested in a few persons or in a dominant class or clique; government by the few.
a state or organization so ruled.
the persons or class so ruling.
America, the United States, is an Oligarchy.
Part Three
The oligarchy, and the PTB (The Powers That Be) are one and the same. Nothing that is written here is unknown to them. They know about all of this, and they do expect everything to crash, or go through a “big reset”.
They plan on this, and have predicted it. They expect it to happen, and fully expect to survive through it. In their viewpoint, they will end up better placed afterwards.
Though, to the vast bulk of Americans, it is new information. Often dismissed as “conspiracy rubbish”.
It isn’t.
So what does all this mean?
The United States is neither a Republic or a Democracy. It is an Oligarchy.
Those that are in the Oligarchy realize that all Oligarchies collapse, and they have been trying to manage this collapse for the last decade.
In fact, they want this collapse to happen, for they believe that not only will they survive it, but that their position, and the world, and society would be better afterwards.
Those not part of the PTB Oligarchy will suffer.
However, those that are resilient, able to discern, and adaptable will be able to “ride the waves of discord” and survive just as well as the oligarchy can.
You just need to change your ideas and attitudes about who you are and what your role is.
Last minute note…
https://www.yicaiglobal.com/news/american-families-only-half-as-rich--as-those-in-chinese-cities
Some food for thought (and controversy): Is the median net worth of American families really only HALF the net worth of Chinese families?
When looking at median net worth (rather than average!) this seems to be the case and points to significantly higher inequality in the US compared with China, which has its fair share of inequality nonetheless.
In addition, Chinese families are sitting on very valuable self-owned properties (often more than one actually), are less indebted and have higher savings.
What conclusions shall we draw from these perplexing numbers?
-Dr. Shirley Yu
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