What happens to working class when billionaires are in charge

By Ana Swanson

The Washington Post

President-elect Donald Trump was propelled into office largely due to a campaign message that promised to lift up working-class people and restore America to its former greatness. Yet, since the election, he has begun assembling the wealthiest Cabinet in modern American history, featuring corporate chief executives, millionaires and billionaires, and heirs and heiresses.

Trump and his supporters don’t necessarily see a contradiction. The logic to many of the Cabinet picks appears to be similar to that of Trump’s own campaign pitch: that he and his appointees are proven dealmakers and business leaders with the ability to clean up Washington’s “rigged system” for the benefit of average Americans.

But research into how people’s political opinions are formed suggests that the Cabinet’s incredible wealth could matter for the results that voters see. Researchers have found evidence of a natural gulf between the policy positions of the wealthy and the working class in the United States — and they’ve found that the preferences of the wealthy have been far more likely to translate into action.

“We certainly have broad evidence that people who are in positions of power tend to reflect their demographic, occupational, economic profiles in policy opinions and policy goals,” said Matt Grossmann, a political scientist at Michigan State University. “Anytime you have an overrepresented group … that is reflected.”

Researchers describe this as an issue that extends far beyond Trump’s Cabinet: Wealthy Americans have long been overrepresented in all branches of the federal government, and in both political parties. The differences in political opinion by social class are not as big as differences between Republicans and Democrats, says Nicholas Carnes, a researcher at Duke University who studies the topic. However, policy preferences do vary substantially by economic class, likely because they stem from people’s life experiences.

The most influential research on the topic comes from Martin Gilens of Princeton University and Benjamin Page of Northwestern University, who compare the policy preferences of the affluent — defined as the top 10 percent — with those who are roughly in the middle of the income distribution.

The opinions of the two groups are broadly similar in some areas — with regard to much of foreign policy, for example. But in other policy areas, the preferences of the wealthy tend to diverge sharply from those in the middle. That’s especially true when it comes to bread-and-butter economic issues like taxes, the minimum wage and social safety nets.

“Things like tax progressivity, deregulation and trade were all consistently different between middle income and affluent Americans. Where we do have some data on the truly wealthy, they are even more free-market oriented and in favor of tax cuts on the well-to-do than the merely affluent,” Gilens said.

Another study carried out by Page and other researchers of people in or near the top 1 percent of wealth holders showed that extremely wealthy Americans were more likely than the population as a whole to support cutting Social Security, food stamps and health care, as well as somewhat more likely to support cutting homeland security, environmental protection and job programs. They were less likely to support labor unions, increasing the Earned Income Tax Credit and providing unemployment benefits.

The survey revealed that only 40 percent of ultra-wealthy respondents said minimum wage should be high enough so that no family with a full-time worker can fall below the poverty line, compared with 78 percent of the general public.

“People who spend their lives among the well-to-do are naturally more familiar with the outlooks, the interests, the ways of understanding the world, than are typical among the working class,” Gilens said.

In many ways, Trump and his supporters don’t neatly fit into these groups. Though Trump is a billionaire, he has been highly critical of global free trade, a policy many wealthy people support. And though many of Trump’s supporters are working class, they were more likely to support policies like deregulation.

But, in general, there is less support for social welfare policies among the wealthy than lower- or middle-class people.

“This is not to say that business people are bad, or rich people are bad, but it’s important to recognize that everyone’s perspective and policy and government is shaped by the kind of life you’ve lived,” Carnes said. “If you’ve been rich for a long time, it’s easy to forget about the perspectives of those who don’t have so much.”

According to research by Gilens and Page, the opinions of lower- and middle-class Americans rarely become policy. The two researchers looked at 1,779 policy issues from 1981 to 2002. They found that the opinions more common among economic elites and the groups that represented businesses were more likely to become policy over the next four years. However, they found that average citizens and the groups that represent them had almost no influence over how the government ultimately acted.

“Government doesn’t respond perfectly to the preferences of the well-to-do, but it does respond. It seems to respond virtually not at all to the preferences of ordinary and middle-income Americans,” Gilens said. “When you have an administration, or for that matter a Congress, composed predominantly of people whose backgrounds and current social environments are narrowly reflective of the very affluent, then it’s not surprising that we find government policy reflecting those worldviews and advancing those interests.”

There are exceptions. During the two decades of Gilens and Page’s study, Congress passed various laws aimed at boosting working-class and middle-class Americans: increasing the minimum wage, expanding the Earned Income Tax Credit, guaranteeing unpaid medical leave for most workers, and establishing Empowerment Zones to encourage private investment in low-income neighborhoods, for example.

Trump is not by any means the first American leader to include wealthy people in his Cabinet. President Obama’s current Cabinet features Penny Pritzker, a member of one of wealthiest families in America, whose net worth Forbes estimates at $29 billion. Several multimillionaires have served in his Cabinet, as well, including Homeland Security Secretary Jeh Johnson and secretaries of state Hillary Clinton and John Kerry. George W. Bush appointed to his inaugural Cabinet Paul O’Neill, Donald Rumsfeld and Colin Powell, all of whom were multimillionaires.

But Trump’s advisers include more millionaires and billionaires than past Cabinets.

Betsy DeVos, the Michigan billionaire nominated to be Trump’s education secretary, is the daughter-in-law of the co-founder of Amway Corporation, whose family has a net worth of $5.1 billion, according to Forbes. Industrialist Wilbur Ross, Trump’s nominee for commerce secretary, has a fortune of $2.5 billion. Linda McMahon, whom Trump has chosen to run the Small Business Administration, amassed a fortune as she built a wrestling business empire with her husband, Vincent McMahon, whose net worth Forbes estimates at $1.12 billion.

Figures for other potential Cabinet members are harder to come by, though their job titles and asset holdings hint at great wealth. Steven Mnuchin, the proposed head of the Treasury Department, is a former Goldman Sachs executive, while Elaine Chao, the transportation secretary, is the daughter of a shipping magnate. Ross’s deputy at the Commerce Department, Todd Ricketts, is the son of a billionaire and the co-owner of the Chicago Cubs.

Andrew Puzder, the nominee for labor secretary, owned roughly $25.6 million in shares of CKE Restaurants, the parent company of Carl’s Jr. and Hardee’s, in 2010, according to documents filed with the SEC. And secretary of state pick Rex Tillerson, the chief executive of Exxon, owned about $218 million in Exxon stock and had a pension plan worth $69.5 million as of last December, according to SEC documents.

“My impression so far is that this is going to be a much wealthier Cabinet than the one that preceded it, and that doesn’t bode well in terms of the representation of the views and needs of middle and working class Americans,” Carnes said.