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Monday, November 18, 2013

Boomtown: DC Fastest-Growing Region for 'One-Percenters'

by Tony Lee 18 Nov 2013, 5:14 PM PDT  
Source Breitbart
The expansion of the federal government and the complexity of federal regulations and laws have made Washington, D.C. the nation's foremost "Boomtown" with the most so-called "one-percenters." 

The Washington Post describes what Breitbart News Senior Editor-at-Large and Government Accountability Institute President described as a "new Versailles" that is built on "borrowed money." Schweizer made his remarks on a special directed by Breitbart News Executive Chairman Stephen K. Bannon that aired on Fox News's Hannity in January of 2013. The special was appropriately called, "Boomtown." In 2011, in a landmark speech in Indianola Iowa, former Alaska Gov. Sarah Palin assailed the "permanent political class" in Washington's Boomtown that valued crony capitalism over free markets. 

The Post notes that Washington's "spend, spend, spend" culture started after 9/11 when Republicans controlled all three branches of the federal government and, during the past decade, "the region added 21,000 households in the nation's top 1 percent. No other metro area came close." 

An analysis found that the "area's 1-percenters are most likely to be lawyers and executives, or those who work in management consulting or IT. Nearly 1 in 10 of those households is headed by a government worker."

During the last decade, service contracts boomed. In 2010, "companies based in Rep. James Moran's [D-VA] congressional district in Northern Virginia reaped $43 billion in federal contracts—roughly as much as the state of Texas." 

On top of that, "big companies realized that a few million spent shaping legislation could produce windfall profits. They nearly doubled the cash they poured into the capital."

Mark Muro, a policy director at the liberal Brookings Institution, echoed Schweizer's observation and said Washington "has been the beneficiary of a decade-long, taxpayer-funded stimulus package."

The Post profiled a government worker, Ulysese Jefferson, who had $5,000 in his savings account when he started a government contracting firm at the start of the boom in 2001 that he sold for $90 million ten years later in 2011. That worker also benefited from "a special program for minority-owned small businesses" that allowed him to "receive small contracts without going through the months-long competitive bidding process." 

During this time, the Post reported that "corporate America learned that lobbying was one of the most surefire ways of bolstering its bottom line" and profiles a company that spent $260,000 lobbying Congress in 2000 before pouring $2.6 million—a tenfold increase—by the end of the decade. 

Insiders said big corporations "became fully convinced that having a large-scale Washington presence was a good strategic decision." 

And as laws became more complex, Washington passed monstrous pieces of legislation nobody could understand, which meant "legal services also boomed... The number of lawyers in the D.C. metro area increased by a third from 2000 to 2012, nearly twice as fast as the growth rate nationwide."

As Schweizer noted in Extortion: How Politicians Extract Your Money, Buy Votes, and Line Their Own Pockets, after the Dodd-Frank financial regulation bill—2,000 pages of regulations to the Glass-Steagall Act's 35—passed, those who wrote the Dodd-Frank Act immediately made "hundreds of thousands of dollars interpreting" the nebulous rules they wrote for businesses and corporations.  

As the Post noted, the "culture of a once staid capital and created a new wave of well-heeled insiders" and the "new Washington are not just the former senators, party consiglieri and four-star generals who have always profited from their connections," but are the "former bureaucrats, accountants and staff officers for whom unimagined riches are suddenly possible."

"They are the entrepreneurs attracted to the capital by its aura of prosperity and its super-educated workforce," the Post writes. "They are the lawyers, lobbyists and executives who work for companies that barely had a presence in Washington before the boom."

The Tea Party movement formed in part against the big-government Republicans that helped turn Washington into the Boomtown financed by extracting wealth from taxpaying Americans.