Inequality Will Not Go Away On Its Own.

 The immediate crisis may have passed, but most Americans still haven’t recovered from the worst economic disaster since the Great Depression. Wealthy Americans, on the other hand, are doing better than ever. In the three years after the recession hit, economist Emmanuel Saez has calculated, the top 1 percent captured an incredible 91 percent of the nation’s income growth.

This latest surge in inequality has not gone unnoticed. In 2011, the Occupy movement’s “We Are the 99 Percent” rallying cry thrust our nation’s great divide onto the center stage of American politics. In 2014, an international best seller from a previously unknown French economist, Thomas Piketty’sCapital in the Twenty-First Century, sounded the alarm about the global plutocracy that will emerge if current trends continue. In 2015, Black Lives Matter activists connected the dots between police crackdowns and the local revenue shortfalls made inevitable by tax cuts for America’s wealthiest.

The climate-justice movement, meanwhile, has highlighted the fact that our dream of unfettered economic growth imperils the very future of humankind on this planet, and that global climate change is hitting the poor and people of color hardest. To save our earth in its current form, we’ll need to start thinking much more seriously about sustainability and equitable distribution.

All of these currents have contributed to inequality’s unprecedented visibility in the 2016 presidential race. Senator Bernie Sanders has made America’s toxic concentration of wealth the centerpiece of his campaign. Hillary Clinton has also acknowledged that inequality is a serious problem. And a solid majority of Americans agree: According to polls, 75 percent support raising the minimum wage, and 68 percent support increasing taxes on people earning more than $1 million. Even 76 percent of our billionaires, a Forbes survey found, regard income inequality as a “serious societal problem.”

Unfortunately, all this rising concern has not yet translated into significant results. To be sure, a number of states and localities have raised the minimum wage. The Obama administration has also granted home-care workers the right to wage protections and expanded the number of workers receiving paid sick leave and overtime pay. The Dodd-Frank financial reforms have taken some modest steps to rein in CEO pay and protect ordinary Americans from reckless Wall Street greed. And there is increasing bipartisan support for addressing the policies of mass incarceration that have widened the racial divide. But the overall trend toward inequality is actually accelerating.

In fact, inequality has kicked into hyperdrive. America’s 400 richest individuals, according to the new “Billionaire Bonanza” report from the Institute for Policy Studies, now have more wealth than the bottom 61 percent of the US population. Our nation’s 20 richest individuals — a group small enough to fit in a single Gulfstream jet—have more wealth than the bottom half of the entire US population.

These inequalities will not go away on their own. Hereditary wealth will soon dominate us, as Piketty has shown, unless we boldly intervene. But just how should we do it?

More: http://www.thenation.com/article/inequality-will-not-go-away-on-its-own-heres-how-to-close-the-gap/

Comments.

  1.  February 22, 2016 at 1:17 pm

    We already have a “stakeholder constituency.” The largest in the nation. They could rally around irrefutable facts concerning Federal tax policy. Every working American must pay Federal taxes, income and payroll, ostensibly to fund Federal agencies and programs. When told the truth about what actually happens to their tax dollars they would rally to change everything. The truth is that none of those tax dollars actually pays for government expenditures. These dollars are confiscated from us under the false premise that without them the Federal government would not be able to fund itself without incurring massive debt through ‘borrowing.’ That too is false. Taxation and borrowing have absolutely nothing to do with funding government spending. http://goo.gl/a5zMg6 Taxation is primarily about forcing us to accept the ‘dollar’ as a medium of exchange since it is not backed by gold, silver or wampum. It’s simply a piece of paper. Coercion, levying a penalty for NOT paying the tax, is the only way providers of goods and services to the government and each other would accept the government issued dollars as payment. http://goo.gl/Ak7Dfy Taxation also manages aggregate demand by draining dollars from the economy when inflation threatens. The failure of taxation to serve as a regulator of income distribution is the tracesty of the past 50 years. It’s supposed to provide a meachanism that keeps concentrations of wealth more evenly distributed but doesn’t because we use the wrong kind of tax. “Borrowing” by the Federal government never actually happens since it is the issuer of dollars it doesn’t need to borrow them from any entity. What it does is exchanges swaps assets to maintain the term structure of its interest rates. If the taxpayers of America ever understand the above there would be riots in the morning. If they knew that all the Federal government needs to complete the act of spending is an appropriation they would demand funding to serve public purposes. Then there’s the fear of deficits which would vanish once they understood that when the government deficit spends that spending is equal, to the penny, to net savings in the private sector. This means that our checking accounts receive these Federal funds as payment for our goods and services sold to the government and to each other. Taxpayers must be told that wherever there’s a deficit there’s a surplus. When the government reduces deficit spending it, by definition, reduces dollars flowing into our checking accounts. Deficit spending stops or slows when the economy approaches full employment defined here as U6 at 4% not the headline U3 of 5%. These indisputable facts of fiscal policy need to be presented to taxpayers as the foundation upon which programs such as free college education, Medicare for all, infrastructure rehabilation, massive investments in; renewable energy, medical and oceanagraphic research can be funded without real financial constraints. If most Americans knew that their Federal tax dollars pay for absolutely nothing, America would be free to eliminate poverty, income inequality and much, much more.

  2. Nothing revolutionary here…. We need to recognize that economic justice is not possible if left to the invisible hand. Only government regulation and programs to redistribute opportunity and wealth came create a thriving middle and working class.

  3.  February 20, 2016 at 2:44 pm

    The paucity of times that i even hear discussion of remedies for income and wealth inequality, it usually sounds similar in tone to this article. Similar in that it enumerates ways to “close the gap”. That is perfectly fine, as far as it goes. (And i believe that there are some excellent suggestions raised both in the article and in some of the comments that follow it.) But, in my estimation, it doesn’t go far enough. Because, all of the suggestions depend upon outcomes that will presumably happen at some unspecified time IN THE FUTURE. So, i usually come away disappointed that there was not even any MENTION of what could — and SHOULD — be done IMMEDIATELY.

    “Our nation’s 20 richest individuals…have more wealth than the bottom half of the entire US population.”

    The average wage earner lives one’s life on less than $2 million: the CUMULATIVE fruit of an entire working lifetime of labor. Consequently, every time i read a declaration such as the one quoted above from someone’s research, i think: That means that if these (in this case, 20) people were dispossessed of all but an amount reasonable to live on, then (usually) “the bottom half” of the population of some massive expanse of Earth (if not its entirety) could see a DOUBLING in their standard of living RIGHT NOW. This fact needs to be repeated emphatically until there is not a single fast-food worker or retail cashier anywhere who hasn’t heard it. And it needs to be aggressively proposed (repeatedly, if necessary) until there is not a single official in government who hasn’t publicly declared a position on it, as well.

    Antagonists of this idea will invariably and ardently demand that you explain how one ‘could possibly justify’ such a dispossession. Just as ardently, you will answer with three facts: 1) Those 20 individuals DID NOT (and COULD not) EARN all of the wealth that they are permitted to control; 2) Those 20 individuals DO NOT NEED all of the wealth that they are permitted to control; and 3) Most of the wealth that those 20 individuals are permitted to control came from people who DID earn it and DO need it. You will then demand — ardently! — that the antagonist explain how, in light of these facts, one could possibly justify NOT performing such a dispossession.

    Even if one thinks that the chances of a successful dispossession are exiguous (– in fact, ESPECIALLY if one thinks that –), IT IS VERY IMPORTANT to begin to raise and persistently PRESS the issue of IMMEDIATE redistribution. Though there are those of us who may lack the fortitude to advance such an idea now, that is not to say that our progeny will eternally be as morally flaccid as we may be.

    Inequality will not go away on its own.

  4.  February 19, 2016 at 12:58 pm

    Time to dust off the We’re Not Broke documentary again and familiarize ourselves, again, with the hows, ways, and means that the system is rigged in favor of the wealthiest individuals and multinational corporations. They have purchased, through money and lobbyists, through job security for soon-to-be-former Congressional members and CEO/CFOs, through complicated tax code shell games which move their money digitally from offshore tax haven to offshore tax haven (wreaking havoc in the wake – take Ireland, for example – and destabilizing infrastructures abroad as well as here at home) our democracy on the cheap. Our only recourse is to FIGHT back together. TOGETHER. To continually write and post, show up, speak up, and VOTE the business-as-usual cheats out of office. http://youtu.be/TPHlhzRSEnw

  5. As Khrushchev said, “We do not have to invade the United States, we will destroy you from within.”

  6.  February 18, 2016 at 7:49 pm

    Where is closing the tax shelters and jailing corporate fraudsters? Trillions are hidden and it’s not even mentioned? Enough. No more Swiss Banks, Channel Islands, Cayman Islands, Lichtenstein, Panama, Bahamas and I’m sure I’m missing others. This is a massive problem but no one seems to want to mention it. Why?

  7.  February 18, 2016 at 5:56 pmAs long as the present dark money and other sources exist the system will not change. Our legislators pay only enough lip service to get elected, then do the will of those with money. In my opinion, we are doomed to become a two class society, the Ultra rich and powerful 1%, and the not-rich and not-powerful 99%. I despair.

  8. The rise of the middle class has been staunched by more than one policy, but of them two stand out. The rise of unions helped to ensure that workers were paid far better than the slave wages of the past. These better paid workers had money to spend, which in the U.S. is the engine of the economy. More jobs brought about upward pressure on wages. For at least the past two decades unions have been on the decline due to political oppression and trade agreements. As unions declined so did the fortunes of the middle class they created. A second source of huge inequality has been the change in the tax structure. The wealth of the Gilded Age tycoons began to be mitigated by top marginal tax brackets of over 90%. Over the past 3-4 decades the tax climate has been very favorable to the wealthy from lower taxes on unearned income (how crazy is that?), far lower top marginal income tax brackets and a host of ways to shield income from taxation. If we are serious about reversing this disastrous inequality which is destroying both the economy and the fabric of our society, we need to stop destructive trade agreements that benefit only corporations, support higher wages through minimum wage increases and union-friendly policies, and adopt a tax structure that was in place when Eisenhower was President.

  9.  February 18, 2016 at 11:19 am

    We always have this conversation as if there isn’t a war (on terror) going on, which has contributed almost $1.7 trillion to our $18 trillion debt. Taxpayers are paying $502.28 billion for Department of Defense FY2015 spending alone — a whopping figure that does not include the cost of war. We must be honest with ourselves: our use of tax dollars to kill an enemy we keep mindlessly reproducing (and to line the pockets of war profiteers), instead of on infrastructure, free and universal pre-school, health care and other needs pretty much secures economic inequality for generations to come. And given the ways this war has been racialized, I would argue that it also further entrenches racial inequality. The war on terror, after all, rationalizes an ethic that construes the Other-than-white as deserving not only of economic and physical violence, but also of political repression (one only need examine the white nationalist politics of the Trump campaign to see how this thinking is becoming the expression of mainstream politics). Additionally, through our war we are also exporting economic inequality abroad. Drone strikes and other acts of Democratic terror not only kill people; they also destroy infrastructure, foment civil conflict, interrupt commerce, create refugees, and generally cause instability that impoverishes families and communities. An agenda that will “reverse runaway inequality,” then, must also be anti-war (where is our anti-war movement, by the way?). And it should go without saying that such an agenda must be anti-war not only because our war on terror contributes significantly to economic and racial inequality, but also because it is ultimately wrong and unjust.

11. IMHO the main problem is human mind or, IOW, our genetic heritage. Until we will not rise above ourselves, the distribution of material and intellectual goods created by humans, will proceed as we experience it now. It will proceed until collapse. We are not able to rise above ourselves – this means completely new education without religions and superstition, completely new ethics and values, completely new culture. And even more: We need to solve the global problems we have created – climate change, population growth, resource depletion. We are not able to this, we are not prepared for this. I.V. 

 

About basicrulesoflife

Year 1935. Interests: Contemporary society problems, quality of life, happiness, understanding and changing ourselves - everything based on scientific evidence. Artificial Intelligence Foundation Latvia, http://www.artificialintelligence.lv Editor.
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