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This stretch of Park Avenue on the upper east side of Manhattan is the wealthiest neighborhood in New York City.
This is where the people at the top of the ladder live.
The upper crust.
The ultra-rich.
But this street is about a lot more than money.
It's about political power.
The rich here haven't just used their money to buy fancy cars, private jets and mansions.
They've also used it to rig the game and their favor.
Over the last 30 years they've enjoyed unprecedented prosperity from a system that they increasingly control.
But if you head north for about 10 minutes, this Park Avenue comes to an end at the Harlem River.
On the other side of the water, there is another Park Avenue.
This is the South Bronx, home to America's poorest congressional district.
There are 700,000 people in this district, almost 40% of them living in Harlem, making less than $40 a day.
From here, the last 30 years have looked very different than the view from Manhattan Park Avenue.
People here have seen the wages fall and the cost of almost everything else go through the roof.
They've lost their jobs in a recession across their bankers, across the river.
They've watched their children struggle in failing schools.
And they've ended up even worse off than they were a generation ago.
But America is still a land of opportunity, isn't it?
A place where anyone can make it to the top if they're willing to work hard and set their sights high.
That's what makes this country great. Isn't that what we tell ourselves?
But in today's America, what are the chances that someone who starts their life on this Park Avenue
will end up living on this Park Avenue?
Let's imagine that you're invited to a game with Monopoly.
And you arrive at this game to find out that all of the property's been divided up.
All of the money's already been handed out. But you're told, hey, go ahead and sit down, play the game.
We're going to give you a chance to play just like everyone else.
There are some in society that have a lot of access, a lot of social mobility, a lot of resources
to do the things that they want, as opposed to other people who are more disadvantaged, more underprivileged,
don't have the same levels of resources.
Paul Piff is a social psychologist at the University of California, Berkeley,
who studies the psychology of wealth and the consequences of inequality in our society.
We came upon an experiment he conducted that caught our interest.
Oh wait, I get 200 bucks because I just...
Oh yeah.
Monopoly first became a hit during the Great Depression.
It's a game of ruthless dog-eat-dog capitalism.
True to the American dream, everyone has an equal opportunity, starting with the same amount of money
and the same chance to succeed.
Winning is a mix of luck and skill.
For his experiment, Piff rigged the game by giving one player a huge advantage.
So there are two players, they don't know each other.
You flip a coin to determine your position.
So it's random, almost like your emergence into the world is random,
whether you land in this family or this other family.
If you were the rich person, you got a lot more money.
You got two times as much money.
When you pass go, you collect $200.
You would get to roll both dice.
So you're allowed to move around the board quicker.
Now if you're on the low end, we really hit you hard.
You got half the money when you passed go, you collected half the salary.
I'm gonna lose pretty soon.
You only got to roll one die.
So you're moving around the board very, very slowly.
The other person's just whizzing around you, collecting $200 every couple of turns.
I'm gonna get another $200 again.
I know.
Even in a game that's openly rigged, the rich players inevitably exhibit a sense of entitlement.
They gobble up more of the carefully placed pretzels.
They come to believe that they deserve to win.
I'm gonna buy out this whole board.
And they show no concern for the misfortune of the poor players,
even though the poor players don't stand the slightest chance of winning.
The idea of the American Dream is that everyone's got an equal opportunity.
You just got to decide to play.
But in fact, there are large groups of people that experience the game as unfair.
The opportunity's not there.
All the rules have been decided.
The property's already been bought up.
And the money's already in the hands of the other players.
Get ready, man!
Go, go!
Where's my goal?
I'm making Jordan.
I'm making Jordan.
I'm making Jordan.
I'm really!
Almost all families start out with wanting the same things for their children.
They want them to be safe.
They want them to be happy.
And they want them to be successful and healthy.
But even before birth, so many kids start that race behind.
They come into a neighborhood that's unsafe.
Maybe they're in an overcrowded apartment.
They don't have health and nutrition.
They might have medical issues that aren't being addressed.
I would say their number one challenge is just a lack of opportunities in general.
In parts of the South Bronx, unemployment has reached 19%.
And many families struggle just to put food on the table.
Pastor Colin Dunkley and his wife, April, run a food pantry in the South Bronx.
It feeds about 200 struggling families every week.
I like helping people.
I like serving the people.
I like helping the people.
If there's something we can do to bless them, that's what we're going to do.
Would you typically get the vegetables in a can, beans in a can, bags of rice?
Sometimes we get the little sippy capris and juices.
We'll put those in a bag through the can.
But they don't have nearly enough to meet the demand.
When we visited, they ran out of food in 15 minutes.
There is no more food at this time.
You can come back next Monday at 2 o'clock.
That's it, mommy. That's it.
No, sir. I'm sorry. No more.
It is very, very hard to pull yourself out of extreme poverty in the United States.
It almost never happens.
This runs completely counter to what people's notion of America has been for a very long time.
We think of ourselves as the land of opportunity.
Mobility in the United States lags most other advanced industrial democracies.
When I was growing up, the image of America, the self-image, was of a vast middle-class country.
Of course, there was a small, rich group, and there were some poor,
but America prided itself and understood that its health was because of a vast middle class.
We're not that kind of society anymore.
There's always been a gap between the wealthiest in our society and everyone else.
But in the last 30 years, something changed.
That gap became the Grand Canyon.
The incomes of people at the lower end stagnated.
A disproportionate amount of the growth in the economy has accrued to those at the upper end.
This is what America's economic pie looked like in the decades after World War II.
Income gains were shared by everyone, with big portions going to average Americans.
But since the late 1970s, the bottom 90% have seen their share of the pie completely devoured by the top 1%.
The wealthier are getting an enormous percentage of all of the gains in the entire economy.
When I talk about the wealthy, I'm talking about, like, in the thousands of people.
Thousands might be overstating it.
As of 2010, only 400 of the richest Americans controlled more wealth than the bottom half of American households.
That's 150 million people.
The question is, what are the people at the top going to do with all that money?
There is a little tiny group, and it's probably 1% of the 1%.
Those people are concentrated in a very small number of places.
New York has been one of those places since the early 19th century.
It has been a world city with world-class fortunes, and it has been a magnet for people who live in the 1% of the 1%.
I was in a taxi going down Fifth Avenue, looking for the richest apartment building in New York.
There were about 10 buildings that were on the initial list.
740 Park became the epicenter of the people who ruled the world, truly the masters of the universe.
They all lived in 740 Park.
It was known before my book as the Rockefeller building,
but in fact, Rockefeller was not one of the original people in the building.
It was built by Jackie Kennedy's grandfather, James T. Lee,
in a consortium with a group of the people who were considered to be responsible for the market crash of 1929 and the depression that followed.
And then it became kind of the Standard Oil building.
It was a building where lots of Standard Oil executives and their friends all lived.
It was truly considered the holy grail for a certain kind of wealthy New Yorker.
Now the largest category in 740 Park are hedge fund guys, and they're the people with the most money now.
They're the equivalent of the oil people from the 30s.
These guys ruled the world, you know.
They are multi-billionaires of, you know, the CEOs of the major corporations in the world.
This doorman once worked at 740 Park Avenue.
He agreed to be interviewed under the condition that we hide his face and alter his voice.
To work at 740, you really need to know somebody within the business.
You know, you're working at the top building in the world.
It's only 31 units.
It's not a lot of residents, but they're high-tempered and, you know, you have to have a thick skin to work there.
You're going to be dealing with detestable people and you're going to be dealing with billionaires.
You need to know everything about the residents, what time they wake up to go to the Wall Street,
whose car is which, who likes to get their own door, who gets in the passenger seat, who gets in the back seat.
You know, these things don't seem like a big thing to me and you, but even a minor mishap, you know, you'll be fired straight away.
Who are some of the key tenants in the building now?
You've got John Thane, the CEO who presided over the downfall of Merrill Lynch.
Ezra Merkin, who was the feeder to Bernie Madoff.
David Koch, who was the richest person in the building.
And of course, Steve Schwartzman, the poster child of Capitalist, agreed in the last 10 years.
Billionaire Steven Schwartzman, one of the kings of private equity, lives in 740 Park's most extravagant apartment.
Schwartzman was a managing director at Lehman Brothers before co-founding the Blackstone Group.
He is one of the most prominent CEOs when it comes to lobbying for tax policies that favor the ultra-rich.
He was a strange guy, Mr. Schwartzman.
Thank you for the opportunity to address the 66th annual Alfred E. Smith Memorial Foundation Dinner.
We call it Occupy Waldorf.
He seemed to be out of the public eye, but then these little spurts where he'd have his 60th birthday party,
he had Rod Stewart play and it was all over the papers and he had a replica of his apartment built in this hotel
and it was just completely ridiculous.
He'd have his annual Christmas party and he'd have 25 Christmas trees come in, these massive Christmas trees.
25 Christmas trees?
Yeah, I mean, every room would get a Christmas tree and be fully decorated.
Steve Schwartzman lives in the apartment that had previously been owned by John D. Rockefeller Jr.
But it's a sprawling apartment, it's 37 rooms, lavish beyond your wildest imagining, you know, 20,000 square feet.
Schwartzman paid just under $30 million for this apartment.
Pluck a change for a Wall Street tycoon worth over $5 billion.
If a few people, you know, do really well, why is that such a big deal?
Isn't that just proof of the American dream? You work hard and you're successful.
We as a society have very complex views about economic inequality.
Americans are not of the view that all inequalities of wealth or income are unjust
and in fact they think if you work harder, if you seize opportunities, then you should be able to get ahead.
Jacob Hacker is a political scientist at Yale and the co-author of Winner Take All Politics
which argues that this extraordinary accumulation of wealth at the top isn't just about hard work.
It's about wealthy interests using the political system to rig the rules in their favor.
There's been a reinforcing cycle. Those at the top have done well.
They've invested in policies that are favorable to them and they've done even better
and then they've churned a lot of that money back into politics.
To understand how big money rigs the rules in Washington, we sought out the poster child for political corruption,
former lobbyist Jack Abramoff. Having pled guilty to charges including conspiracy to bribe public officials,
Abramoff spent nearly four years in federal prison.
Now released, he's touring the country trying to promote reform.
I wish I could tell you that in the midst of all of my lobbying activity, I came to an epiphany but I didn't.
It unfortunately for me required my demise.
Jack Abramoff has pled guilty to federal corruption charges.
But eventually I decided to look honestly at the past activities I had engaged in.
I also systemically looked at the overall picture and realized the system itself was really badly in disrepair.
The lobbyists will bring in the exact draft of what they want because they want to make sure it is exactly what they need.
And the staff are busy, the congressmen busy and so they frequently in the past and still avail themselves of the services.
Let's call them of the lobbyists to write these bills.
Now as a lobbyist, what was your leverage in terms of getting members to sponsor the bills that you had written?
A lobbyist needs to get to the decision maker, the congressman and the staff.
That involves, unfortunately, financial conveyances.
One of the dirty little secrets in Washington today is how much time members of the House and Senate spend every week,
not just in the election season but all the time, year round, on the telephone asking people for money.
It's begging for money, it's a sad spectacle.
When you have campaigns that are costing tens of millions of dollars, the people who have the money want something back.
Money is being used to buy results, that is the problem, that's how I used money.
I know what I was doing.
Washington is almost owned and operated by the U.S. corporate sector at this point.
There are so many billions of dollars of spending on lobbying.
There are so many lobbyists that are in the room writing the regs, writing the laws right now.
There is so much financing of political campaigns, there are so many bought politicians.
Our civics books tell us that the president is the most powerful person in the world
and its special interests must go to Washington to petition the government.
But when it comes time to raise money, our presidents go hand in hand to the people who really have the power.
In 2007, President George W. Bush made a pilgrimage to Steve Schwartzman's apartment
to ask for money for the Republican National Committee.
The Secret Service were coming for, I would say, three to four months before the actual visit.
And they would come every week just to check up, look around the building.
They did background checks on us for sure.
They had the sharp shooters out.
They brought Mr. Bush to Mr. Schwartzman's apartment. He spent maybe 15 minutes out and that's it.
Why did John Dillinger rob banks? That's where the money is.
Well, 740 Park is where the money is and in this day and age
any candidate who didn't go to 740 Park would probably be foolish.
I'm Mitt Romney. I believe in America.
And I'm running for president of the United States.
Romney has a private meeting on Park Avenue with prominent CEOs eager for change in Washington.
Mitt Romney went to kiss Mr. Schwartzman's ring and meet some of his friends
and no doubt collect a few checks.
What makes him good for the country?
Mitt, he's a natural leader and he's accessible. He listens to what you say.
What are you telling him about what needs to be done?
We had a nice meeting about three weeks ago for an hour
and what I tell him stays with me but I'm not shy.
They can influence the writing of laws, the implementation of regulation,
the degree to which the tax code tilts towards business
and those at the top versus ordinary working Americans.
A perfect example of the influence that a small group of billionaires can have on the government
is something in the tax code called the carried interest provision.
It allows hedge fund and private equity managers like Steve Schwartzman
to pay a 15% tax rate on their income.
Even though unlike normal capital gains, they're not required to risk their own money.
When it's explained to people they think it's crazy.
The most highly paid financial executives get taxed at a rate lower than your mom and pop grocery.
It is in the tax code because of the incredibly effective lobbying of the financial industry.
It was a question about carried interest being taxed at a lower rate.
We sort of look at this as sort of an issue that's now in the political world
and it will be solved in that world. We don't have much of a say in that.
Schwartzman went to Capitol Hill yesterday and stood outside the Senate chamber lobbying senators.
Schwartzman was there to fight against higher taxes on so-called carried interest.
From 2006 on, every Democratic leader and president, in the case of President Obama,
has said, we're going to get rid of this.
Let's ask hedge fund managers to stop paying taxes that are lower on their rates than their secretaries.
And then magically it manages to survive.
Before you know it, the congressional session has ended and oh my god, we ran out of time.
We didn't get to it. We'll do it next time.
It appears the Democrats have completed their takeover of Capitol Hill.
Even when the Democrats controlled both houses of Congress,
they couldn't close the carried interest loophole.
The question is why?
It passed the House twice.
But in the Senate, the hedge fund's had a pal in Charles Schumer of New York,
the senator from Wall Street, as he was done for many years.
Charles Schumer is one of the most powerful senators in the country
and has raised more campaign money from the financial industry
than any other Democrat currently serving in Congress.
Schumer became famous for his ability to gain Wall Street dollars.
That's why he was elevated within the Democratic leadership
is because he was such an effective fundraiser.
Schumer in that period was the chairman of the Senate Democratic Campaign Committee,
which, you gotta give the guy credit, he turned this into an absolute money machine.
Schumer helped the Democratic Party raise record amounts from Wall Street.
And in June 2007, as the Senate was considering legislation to close the carried interest loophole,
Schumer went on a fundraising frenzy.
In that one month, he raised more than one million dollars
from hedge funds and private equity firms like Blackstone.
The carried interest bill never saw the light of day.
Schumer just buried the idea.
It never came up for a vote in a committee or on the floor of the Senate.
It just disappeared.
And that, I think, is a perfect example of the way in which money talks in American politics today.
And nobody's money talks louder than David Koch's.
This right-wing oil tycoon with a fortune of 25 billion dollars
is the richest resident of 740 Park Avenue.
David and his brother Charles run Koch Industries,
one of the largest privately owned companies in the world.
They make things like Dixie Cups, Brony Paper Towels, Lycra, and Stainmaster Carpet.
But their most profitable business is oil and gas,
which helps Koch Industries bring in over 100 billion dollars in annual revenues.
Together, the Koch Brothers may have spent more money to influence American politics
than anyone else in the country.
They basically are unprecedented.
They influence American politics on a completely different dimension than anybody else.
The minute you walked in the joint,
I could see you were a man of distinction, a real big spender.
Millions of dollars for Republican politicians.
More than 50 million dollars, for example, to lobby in Washington since 2006.
Good looking, so refined.
Say, wouldn't you like to know what's going on in my mind?
As much as 200 million dollars is their own money this year to help defeat President Obama.
A big spender,
spends
all his time with me.
In 1980, David Koch actually ran for vice president on the libertarian ticket.
They count on growing sympathy for their party's single goal, freedom from government.
He did abysmally.
The libertarian ticket got 1% of the vote in America in 1980.
What they learned from that is they had to figure out another way
to get their ideas to become influential.
So the Kochs decided to use their money to advance their agenda.
They gave generously to political candidates,
but more importantly, they invested heavily in groups
that could bring their anti-government ideas into the mainstream.
The brothers gave millions to right-wing think tanks,
and Charles even founded one, the Libertarian Cato Institute.
Government's too big, and it's getting bigger,
and we don't want to encourage bigger government
to take the keys to the liquor cabinet away from the alcoholics.
The Kochs also wrote out enormous checks to universities
to support programs that would promote deregulation and free market economics.
Their free market ideology, they argue, is just about principle,
but there are many, many areas in which their business interests
butt into regulations.
Environmental regulations have been especially bad for the Koch's bottom line,
and they've been slapped with numerous fines from the Environmental Protection Agency.
We are talking about millions of gallons of crude oil being released into the environment.
In 2000, Koch Industries had to pay a $30 million fine
for its role in over 300 oil spills.
At the time, it was the largest civil penalty in the EPA's history.
When you make businesses less competitive
because they're having to deal with regulations from the Environmental Protection Agency
and other unelected bureaucracies,
instead of creating jobs and instead of being able to compete with our foreign competitors,
we know it kills jobs.
This is Tim Phipps, the head of the Koch brothers' latest venture,
Americans for Prosperity.
We're genuinely fighting to preserve and expand economic freedom,
which we believe is the best way to give folks from every walk of life prosperity
and a shot at a better life.
Through Americans for Prosperity,
the Koch's have provided tremendous financial backing to the Tea Party movement
by organizing rallies and protests, flying in big-name guest speakers.
Don't tax us any more.
And flooding the airways with advertising.
Wasteful spending must stop.
Go to spendingcrisis.org to make your voice heard.
People were looking at the Tea Party movement as this sort of spontaneous combustion
and this grassroots thing that just exploded.
And what it really was was something that was being fed by libertarian billionaires.
We want the maximum freedom to launch businesses, create opportunity, and expand prosperity.
We desire a tax code that does not punish, hard work,
or crush the entrepreneurial spirit that makes America unique in the world.
They have this ideology of the free market and how it's making money equals freedom.
And if you listen to the Tea Party rhetoric, you hear exactly the same phrases.
Our side and the side you're on today is the side, frankly, of freedom.
They're chanting liberty and chanting no more taxis.
Freedom, liberty, and people waking up to the fact that this is our country
and it's up to us to take it back.
Our rights are being taken away, little by little.
But what kind of freedom is Americans for prosperity talking about?
Is it freedom for everyone or just for billionaires who want freedom from taxes,
the freedom to pollute, and freedom from any responsibility to the rest of society?
To answer that question, just go to one of their rallies.
We are likely to see signs promoting a once discredited philosopher and novelist
who's recently found a new audience.
Here in the United States, perhaps the most challenging and unusual new philosophy
has been forged by a novelist, Ayn Rand.
Ayn Rand's point of view is still comparatively unknown in America,
but if it ever did take hold, it would revolutionize our lives.
I am opposed to all forms of control.
I am for an absolute laissez-faire, free, unregulated economy.
Ayn Rand wrote a series of novels that have become a kind of touchstone
for contemporary Republican politicians, most notably Atlas Shrugged.
There's Atlas. He holds the world on his shoulders.
What if Atlas shrugged?
Picture this, an anti-utopia society that collapses under government controls.
Does that sound familiar? It should.
It's Ayn Rand's story of Atlas Shrugged.
And now it's a movie, one very popular with Tea Party members.
Atlas Shrugged is about an America where businesses are regulated.
The rich pay taxes, and the government tries to help the middle class and the poor.
In other words, a doomsday scenario.
In Rand's world, anyone who needs a little help in life is a butcher or a parasite,
and anyone who wants to help others is a villain.
Her heroes are proud to be as selfish as possible.
You really don't care about helping the underprivileged, do you?
No, Phillip, I don't.
Finally, the CEOs of America get sick and tired of living under a government
that no longer caters to them, and they decide to go on strike.
What are you selling, pal?
Nothing. I'm simply offering a society that cultivates individual achievement.
They head off into the mountains and start a new society, one where there is no government.
Atlas Shrugged is told as a horror story, a nightmarish vision of what would happen to our country
if wealthy Americans like David Koch and Steve Schwartzmann just left us to fend for ourselves.
Yeah, we had screenings around the country, and we liked that story to be out there,
and we liked the ideas to be out there.
And we certainly believe and share many of the principles and values that book was based on
the inherent morality of capitalism.
You do not like the altruism by which we live.
We'll say that I don't like. It's too weak a word. I consider it evil.
The appeal of Anne Rand is that, you know, it's basically the Gordon Gekko message. Greed is good.
That ideology is appealing, I suppose. If you have a tremendous amount of money, you might feel guilty otherwise.
How does your philosophy translate itself into the world of politics?
We believe that America deserves a choice of two futures.
Paul Ryan seems more money from the Koch brothers than any other member of Congress.
He is also the country's most powerful politician to publicly embrace the philosophy of Anne Rand.
By running on his anti-government views, this Republican from Wisconsin became a Tea Party favorite,
a powerful member of Congress, and a candidate for high office.
Join me in welcoming the next President of the United States, Paul Ryan.
Vice President of the United States.
We will restore the greatness of this country.
It is our duty to save the American dream for our children.
What kind of people do we want to be?
With his rise to prominence, Ryan has denied his affection for Anne Rand.
But history tells a different story.
I just want to speak to you a little bit about Anne Rand and what she meant to me in my life
and the fight we're engaged here in Congress.
The reason I got involved in public service, by and large, if I had to credit one thinker, one person, it would be Anne Rand.
You believe that there should be no right by the government to tax.
You believe that there should be no such thing as welfare legislation, unemployment compensation.
It's inspired me so much that it's required waiting in my office for all my interns and my staff.
We start with Atlas Shrugged.
How do we build roads, sanitation facilities, hospitals, schools?
I believe in private roads, private cost offices, private schools.
It's so important that we go back to our roots to look at Anne Rand's vision, her writings, to see what our
girding, undergrounding principles are.
We have to go back to Anne Rand.
Our plan takes power away from Washington and gives it back to the individual.
While in Congress, Ryan put Anne Rand's philosophy into practice through a plan he called the path to prosperity.
It was a budget proposal that would dramatically cut government programs for the poor while handing out an even bigger
tax cut for the rich.
I think that the path to prosperity that Chairman Ryan and his committee have put together is a blueprint for America's future.
The path to prosperity passed the House of Representatives in March of 2012.
It now appears to be at the heart of the economic philosophy of the Republican Party.
Mitt Romney and I will take the right steps.
In the right time to get us back on the right track.
What do you think of Ryan's budget framework?
Oh, I think it's ridiculous on the face of it.
He's proposing a $10 trillion tax cut as part of his deficit reduction plan.
And obviously, if you're going to cut taxes by $10 trillion, you've got to cut spending by even more than $10 trillion.
The budget program you can possibly think of from roads to education to energy would be more or less abolished
if you're going to take seriously the numbers that he has put forward.
The idea that there's legitimate economics behind this is absurd.
Conservatives throughout the ages have never spoken like Paul Ryan.
Milton Friedman talked about negative income tax and guaranteed incomes for the poor.
Jack, who is one of the acme's of free market economics, talked about the need of societies to guarantee minimum standards and provide health care.
So there's clearly an ideology involved here.
They actually want to use tax policy to eviscerate government programs.
If we try to go down the path where we put the government in the place to equalize the results of people's lives,
or to equalize outcomes, we'll all be more equally miserable.
Rather, let's focus on equality of opportunity.
My mom used to say to me, son, it don't matter where you begin, what matters is where you end.
You live in the United States of America, and that's something that I think is an inherently moral thing about America.
It gives you a chance to make it.
What they say is about providing opportunity to make money to everybody equally.
That's what they would argue about.
And it doesn't seem to accept the possibility that if you're poor enough and your schooling is bad enough,
that you don't really have an opportunity to compete.
Almost everyone agrees that education is the key to upward mobility.
For people starting at the bottom of the ladder, a college degree can quadruple their chances of making it to the top.
But college is increasingly out of reach.
The cost has gone up over 500% since 1980.
Meanwhile, without a college degree, it's harder than ever to get a job.
If you only have a high school diploma, there's a 7 in 10 chance that you don't have full-time work at all.
It's a cruel irony that the U.S. economy has a desperate need for skilled labor in manufacturing, high-tech, and health industries.
But there aren't enough qualified workers to fill those jobs.
Even with 12 million Americans unable to find work, training and education programs are being slashed by both parties in favor of tax cuts for the rich.
I find it hard to be an optimist right now for people whom I care about and people who the poverty institute cares about,
people who want to support their families through work, and can't.
Today, 1 in 7 Americans receive food stamps. More than half of those people are children in elder life.
41% of recipients live in working households.
A job is no longer enough to keep Americans out of poverty.
For these people that think, okay, they don't need anything, they don't need a handout, they should just go get a job.
Yes, as soon as they create jobs for people to get them, they're great. I'm pretty sure they'll be there.
There's nothing. So what do you do when there's nothing? That's where the safety net comes in.
Yet Paul Ryan's budget proposal would cut the food stamp program by $134 billion over the next 10 years,
which could shred the safety net for 8 million people.
My name is James Salt. I'm a Christian and a practicing Catholic like you.
Oh, great. I have a question. Why did you choose to model your budget off the extreme ideology of Anne Rand
rather than basic economic justice for the values of the Bible?
I like to get my phone off and what it says about how we treat poor and vulnerable.
I suggest you focus on the gospel of Luke.
I appreciate it. I've got some bibles. Thank you very much.
In April 2012, the U.S. Conference of Catholic Bishops urged Congress to protect food stamps.
Bishops suggested that if spending cuts were necessary, they should be made to government subsidies for rich agricultural companies
instead of taking food from hungry children, poor families, and vulnerable seniors.
Our nation is approaching a tipping point. We are at a moment where if government's growth is left unchecked and unchallenged,
America's best century will be considered our past century.
This is a future in which we will transform our social safety net into a hammock.
You can hear Paul Ryan talk about his hammock. This hammock, the average benefit in Wisconsin, was $246 a month last year
for two people, about $350 for four.
Is that enough for you to say, ah, putting my feet up in the hammock, I got these food stamps.
Feeding people is something that this country can afford to do and should be able to do. That's not a hammock.
And if you try to raise our taxes and trample on our liberties, we're either going to beat you or make your life miserable.
The government has been starved of funds. We're at about the lowest tax collection as a share of national income in our modern history.
We can't even pay for the most basic public services right now. We can't keep our schools functioning.
We can't keep our roads intact. Taxes are the price you pay for civilization.
And if you don't pay taxes, you don't get civilization. It's as simple as that.
By that measure, our civilization is in trouble.
General Electric made $5 billion in U.S. profits last year, but claimed a $3.3 billion tax credit.
These days, some of the nation's most profitable companies are paying little or no taxes at all.
Thanks to tax breaks, loopholes, and clever accounting, the tax rate corporations actually pay is at an all-time low.
The same thing is true for personal income taxes, especially for the ultra-rich.
Tax rates for millionaires have dropped more than 25% in the last two decades.
And for a handful of extremely wealthy individuals at the top, taxes have fallen by almost 50%.
A big part of that dip is because of the tax cut signed into law by President George W. Bush.
Bush slashed the capital gains rate on investments to 15%, nearly half what the rate was under Ronald Reagan.
Republicans made all these arguments back in 2003 that if we cut taxes on dividends and capital gains and reduce the top tax rate on the wealthy,
we'll get this explosion of investment and growth and jobs.
You can look up the data for yourself, but I certainly don't remember any big increase in growth after 2003.
There was essentially no economic impact at all, except that it increased the deficit.
The Bush tax cuts have added over $2.9 trillion to the national debt.
Paul Ryan's proposed tax cuts would add another $4.6 trillion in debt over the next 10 years.
What's hard to understand about this relentless push to cut taxes for the rich is that they already have so much more than the rest of us.
In 1965, CEOs made about 20 times as much as the average worker.
Today, by the most conservative estimate, that number is 231.
So what's going on here? Are CEOs getting paid more because they deserve it?
Meet another resident of 740 Park, John Thane, the highest-paid CEO in 2007.
Thane's apartment is actually my personal favorite for if I could live at 740 Park.
It's a little tiny jewel box duplex.
Thane had been a senior executive at Goldman Sachs and served as CEO of the New York Stock Exchange
before becoming the head of the investment bank, Merrill Lynch.
In 2008, as losses were soaring and his company's stock was plummeting,
Thane was busy with a $1.2 million office renovation.
You spent more than a million dollars renovating your office. Is this true?
It was my office, it was two conference rooms, and it was a reception area.
But it is clear to me in today's world that it was a mistake.
I apologize for spending that money on those things.
While Thane was busy picking chairs, rugs, and waste baskets,
Merrill and the other investment banks helped bring down the global economy.
Wall Street has been turned upside down.
The collapse of one investment bank, the takeover of another.
$29 billion to help J.P. Morgan-
$85 billion to bail out the insurance giant, A.I.G.
Wall Street was rescued by U.S. taxpayers, not only through bailouts,
but also through government loans that carried virtually no interest.
I'm confident that this rescue plan, along with other measures taken by the Treasury Department
and the Federal Reserve, will begin to restore strength and stability
to America's financial system and overall economy.
Meanwhile, under Presidents Bush and Obama, millions of middle-class American homeowners
facing foreclosure received only a tiny fraction of the bailouts given to wealthy bankers.
In the end, Merrill Lynch suffered over $27 billion in losses under Thane's leadership
and was sold to Bank of America.
But that didn't stop Thane from handing out $3.6 billion in performance bonuses to Merrill executives.
The bonuses were paid, even as Merrill suffered $15 billion in losses.
If you live in a world where everyone you know is chasing huge sums of money every day
and their morality is determined by what it's necessary to do to get richer and richer and richer,
you're not going to have the same moral constructs affecting your behavior.
When I started at 740, I was like, this is great, you know, come around to Christmas time.
I'm going to get $1,000 from each resident, you know, because they are multi-billionaires.
But it's not that way, you know, these guys are businessmen.
They know what the going rate is.
They're not going to give you anything more than that.
The cheapest person overall was David Koch.
We would load up his trucks, two vans usually every weekend for the Hamptons.
You know, I mean, multiple trips, multiple guys in and out, in and out, heavy bags.
We would never get a tip from Mr. Koch.
We would never get a smile from Mr. Koch.
$50 check for Christmas.
A check?
A check too, yeah.
I mean, at least you could give us cash.
Just because you're rich doesn't make you smart, just because you're rich doesn't make you cultured,
just because you're rich doesn't make you refined.
Being rich means you're rich.
Some rich people are just dicks.
Stephen Schwartzman unleashed a disgusting comparison over the administration's effort to increase taxes.
He said, quote, it's a war.
It's like when Hitler invaded Poland in 1939.
In thousands of different people that we've studied across the country,
the more you have, the more entitled and deserving of those things you feel.
And that might account in part for the vitriol that you see when people feel like their privileged position is being undermined by others.
Since when in this country was it okay to demonize success?
The free enterprise system is under attack.
Back to the old populace, demonize the rich.
You know, the Republicans are always complaining about the Democrats playing class warfare.
The Democratic Party is going to have to stop bashing the rich.
But they do it themselves by, for example, they're always quick to point out that something like half of all people who file individual income tax returns
have either a zero or a negative tax liability.
We have a system today in the United States where 45% of Americans don't pay any income tax.
You have to have skin in the game.
Over 45% of the people in this country don't pay income taxes at all.
And we have to question whether that's fair.
Those are people who don't pay income taxes, okay?
It includes all elderly women living alone who just have enough social security.
They don't even declare it.
It includes disabled people who don't have earnings.
But all of those people pay payroll taxes, sales taxes, property taxes.
State local taxes, gasoline taxes, liquor taxes.
This is ridiculous to say low income people don't pay taxes.
They do pay taxes.
And they pay a lot of them.
They've managed to take the resentment of the middle class, which has actually been quite economically squeezed over the last couple of decades,
and turn their resentment against the people beneath them.
I think we're reaching a tipping point.
We're coming close to a tipping point in America where we might have a net majority of takers versus makers in society.
It's really like a magician trying to point people in a different direction so they won't notice what's really going on.
If you can take the resentment of the middle class and point it downward,
rather than having it point upward to the people on the top of the 1% who are really walking away richer than ever,
then you can succeed politically.
And I think they've been very good at that.
The poor are not very well represented in our system of government, I'm afraid.
Why is that, do you think?
Well, I think one reason I think has a lot to do with the decline of the unions.
Throughout the 30s and 40s and 50s, the unions were the vanguard in pushing for social legislation that would help the lower classes in general.
Unions are perhaps the only organizations with significant financial and political clout that actually represent the working class.
Since the late 70s, corporate interests have been extremely successful at limiting the power of unions.
Only public sector unions have shown signs of growth, and the Koch brothers have put their financial muscle behind an effort to destroy them.
Wisconsin is ground zero. I think it's going to determine largely whether or not the pampered nature of these public-employed unions has finally reigned in.
If you, like David Koch and Charles Koch, want to take over American politics, you're going to want to knock out whatever the organized forces are on the other side.
Discharge the duties.
On January 3rd, 2011, Scott Walker became governor of Wisconsin. He had received significant financial support from the Koch brothers.
The national conservative movement wanted a petri dish, and we were that, and he was more than willing to do what they wanted, not the people of Wisconsin.
Good morning.
Walker quickly introduced a bill to balance the state's budget, but it disguised a much broader agenda.
The governor came in and he said, look, you guys got a great deal on your pension. You don't pay anything for your pension, and it's a good pension, so you should pay 5%.
Half of what the overall contribution is, which is about 5.8%.
Okay, compared to other places that I see. Okay. He said you should pay more for your health care.
We're asking for a health care premium contribution of just about 12.5%.
We had a good deal of health care. Okay.
We removed health care and pension contributions from collective bargaining.
They said, wait a minute. No, we don't want any more collective bargaining. We don't. I mean, wait a minute. Stop. You can't do that.
Walker's legislation was a surprise attack on the political power of public sector unions and their ability to negotiate on behalf of workers.
Take away collective bargaining. And what does the person that's making, let's say, $7 to $9 an hour at University of Wisconsin Hospital serving lunch? What voice will they have in the workplace?
Within days, the largest unions announced that they were willing to make sacrifices that would help save the state money, but they wouldn't give up their collective bargaining rights.
The unions and the Democrats have said they're willing to take the concessions on wage and health benefits. They're willing to take about an 8% pay cut, but they simply don't want you to take away their collective bargaining rights.
What we're asking for, realistically, is something that nearly every other person in this state and every other person across this country is paying a whole lot more for when it comes to retirement and health care.
They already said they're ready to give that up. The governor, they already said they're willing to give up on the pensions on health care.
They already said that. They've already made those concessions.
But you can say anything in the midst of the debate.
Then we really knew it was not about fixing a budget at all. It was about breaking unions and breaking the political power that unions have.
Governor Walker's agenda is a national agenda, and it's seeded and it's well funded by the Koch brothers.
For more than a year, Wisconsin became a battleground. Pro-union protesters occupied the state house for more than two weeks.
They gathered over a million signatures to force a recall election to get Walker removed. The union spent millions fighting for their survival, but wealthy interests outside the state spent far more.
The biggest single source of money was Americans for Prosperity, which has spent over $10 million to support Scott Walker.
Today we have more activists in our Wisconsin AFP chapter than there are members of the Wisconsin Teachers Union. We have a very strong, vibrant operation there.
Walker has painted teachers and other public union employees as the haves and the private sector as the have nots.
What they're trying to do is really squash you so that they can have that much more power and you can have that much less voice.
It's teachers whose pay has been reduced against the Koch brothers. It's not a really fair fight.
Hi, it's Scott Walker. Scott, David Koch. Hey, David. I'm good, yourself. I'm very well.
A little disheartened by the situation there, but what's the latest?
Well, announced Thursday it will probably get 5,000 to 6,000 state workers will get at risk notices for layoffs.
Beautiful, beautiful. Got to crush that union.
And just kind of pass the message on to these guys. If they think I'm cave in, they've been asleep for the last eight years because we don't budge.
Goddamn right. But what we were thinking about the crowds was planting some troublemakers.
You know, we thought about that. My only gut reaction to that would be let them protest all they want.
Sooner or later, the media stops finding them interesting.
The next question, I talk to Kasek every day. You know, John's got to stand firm in Ohio.
I think we do the same thing with Rick Scott, Florida. I think Snyder, if he got a little more support, probably could do that in Michigan.
We start going on the list. There's a lot of us new governors who got elected to do something big.
You're the first domino.
Yep. This is our moment. This is our time to change the course of history.
In places like Wisconsin, the doors of opportunity for those in the lower rungs of society are closing quickly.
We are in very real danger that the American dream is slipping from the grasp of the next generation.
This charity event is a moment for wealthy New Yorkers to give some of their fortunes to the poor.
Over the last decade, Stephen Schwartzman has given over $7 million to New York's Inner City Scholarship Fund.
I worry that the social fabric of America is being ripped purposefully by people who are taking advantage of individuals who are suffering.
Mr. Schwartzman appears to be sympathetic to those who are living in poverty.
But oddly, for one of America's greatest capitalists, he doesn't seem to understand that unlike monopoly, real capitalism is a game that's played for keeps.
For every big winner, there are lots of losers.
Wealth is created, but so is poverty.
Without popular democracy, all the gains of our economy will go to the top.
I'm from Michigan. This is where our money is.
People lost their homes in the banking and mortgage crisis, and it went here.
There's nothing wrong with being rich. God wants all His children to be rich.
But don't be rich and out of place where you ain't thinking about anybody else.
They feel they need not $10 billion but $20 billion of wealth.
They get that extra wealth by twisting politics, buying politicians.
America became a place where money buys everything.
The rich are often held up as shining examples of what's possible in America.
The proof that anyone can make it.
But is there still a bridge to economic opportunity in our country?
When we look at the river that separates the two park avenues, do we see a channel to prosperity for everyone?
Or a barrier that prevents the poor from crossing?
As long as our political leaders depend on the rich to win elections and stay in office,
they will write laws to protect the castles of wealth and power on the other side of this river.
A river that has become a deep and forbidding moat.
