MICHEL MARTIN, HOST:
Elon Musk is worth $435 billion. If he meets certain targets in a pay package from his company, Tesla, he's on track to become the world's first trillionaire. Tesla's shareholders are set to vote on the proposal in November. Our cohost Leila Fadel asked Brookings Institution senior fellow Darrell West about this possible landmark just over a century after John D. Rockefeller became the first billionaire.
DARRELL WEST: What it says is that income inequality is completely out of control. The United States actually has its worst inequality in the last century. And it really distorts both capitalism and democracy.
LEILA FADEL, BYLINE: In what way? The U.S. has an income disparity that's more pronounced than most other developed nations.
WEST: It creates a problem for capitalism just because it leads to the possibility of excessive market dominance. In the case of Musk, SpaceX has more than 90% of the U.S. space launches. Starlink is being used around the world for internet connectivity, and some of the rivals already are complaining about anticompetitive behavior. It creates problems for democracy just because great wealth often leads to undue influence.
FADEL: So Musk's money bought him that influence?
WEST: Musk's money definitely put him in a position where he has had extraordinary influence. He's had an up and down relationship with President Trump, but he's had an amazing impact on the U.S. federal budget. We've seen several federal agencies that were outright eliminated, others that have been sharply cut back. There have been tens of thousands of federal employees who've lost their job. We basically have government by billionaires.
FADEL: Then is the U.S. still a democracy or is it an oligarchy?
WEST: We are moving from being a democracy to becoming an oligarchy just because we have a bunch of billionaires who already have gone into government. We have very wealthy people outside of government who have extraordinary access to the top of government. It's affecting tax policy, education policy and health care policy. So the risk is that America may end up being in a system that promotes the interests of a few and ignores the interests of everybody else.
FADEL: What does that mean for the regular person? I mean, people who make low six figures are living paycheck to paycheck to raise their kids, to pay for school, to pay for health care, to pay for child care.
WEST: Extreme wealth often is not good for the average person just because it's harder and harder for them to get ahead. Everything is more expensive. Education is the means by which people have advantaged themselves in the United States. That's harder for people of average means to pay for, a college education. It's harder to start a business. We have these large firms that are dominating many of the various sectors of the American economy.
FADEL: You talked about the market dominance, the influence in politics. When you say let's come up with policy and strategy here, what does that look like?
WEST: There are questions about tax policy. Like, do we want to tax great wealth at 20%, at 30%, at 40% or 50%? Right now, it is very easy for people with very high wealth levels to avoid taxes or to minimize their taxes. We need to close some of those loopholes. We have tech companies that pay tax rates in the single digits while many Americans of more modest means are paying 20% to 25% in income taxes.
FADEL: The U.S. is built on this idea of the American dream. You can come here and you can build things. And actually, Jeff Bezos and Musk, aren't they examples of the aspirational American dream?
WEST: The American dream used to be alive for many people. But if you look at young people today, it's a lot harder for them at every level. Education is more expensive. Health care is more expensive. Housing is much more expensive. It is hard for them to get ahead. They often come out of school with high debt levels. And it just puts them behind. It makes it very difficult for young people to achieve the American dream.
FADEL: Yeah. And it's interesting because Musk has gotten involved in the U.S. I mean, we saw his super PAC pay people to register to vote. He was heavily involved in the campaign. But he's also gotten involved in political campaigns in other countries, including Germany, around the far right. So his influence goes beyond the borders.
WEST: Yeah, Musk's political influence has been extraordinary.
FADEL: Yeah.
WEST: He contributed a large amount of money that helped Donald Trump become president. He has paid people to become registered to vote. So there are a lot of issues there. And at the same time, he's actually not doing very much philanthropy. Like, there are other billionaires, such as Bill Gates, who has given away a lot of his money.
FADEL: That's Darrell West. He's a senior fellow at the Brookings Institution. Thank you for your time and your insights.
WEST: Thank you very much.
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