This may be the most important article you read this year. The pandemic has exacerbated the huge inequality gaps that existed before the virus struck. Now we see millions of our fellow citizens out of work and sinking into poverty. Wealth inequality and income inequality are growing larger and more damaging by the day.
Venture capitalist Nick Hanauer and Seattle labor leader David Rolf demonstrate the vast transfer of wealth from the bottom 90% of our society to the top 1%. This is not good for our society. In fact, it’s horrible for our society because it creates widespread despair and hopelessness, as well as blighting the lives of our fellow citizens.
Here is a small part of the article. Open it and read it all.
They begin:
Like many of the virus’s hardest hit victims, the United States went into the COVID-19 pandemic wracked by preexisting conditions. A fraying public health infrastructure, inadequate medical supplies, an employer-based health insurance system perversely unsuited to the moment—these and other afflictions are surely contributing to the death toll. But in addressing the causes and consequences of this pandemic—and its cruelly uneven impact—the elephant in the room is extreme income inequality.
How big is this elephant? A staggering $50 trillion. That is how much the upward redistribution of income has cost American workers over the past several decades.
This is not some back-of-the-napkin approximation. According to a groundbreaking new working paper by Carter C. Price and Kathryn Edwards of the RAND Corporation, had the more equitable income distributions of the three decades following World War II (1945 through 1974) merely held steady, the aggregate annual income of Americans earning below the 90th percentile would have been $2.5 trillion higher in the year 2018 alone. That is an amount equal to nearly 12 percent of GDP—enough to more than double median income—enough to pay every single working American in the bottom nine deciles an additional $1,144 a month. Every month. Every single year.
Price and Edwards calculate that the cumulative tab for our four-decade-long experiment in radical inequality had grown to over $47 trillion from 1975 through 2018. At a recent pace of about $2.5 trillion a year, that number we estimate crossed the $50 trillion mark by early 2020. That’s $50 trillion that would have gone into the paychecks of working Americans had inequality held constant—$50 trillion that would have built a far larger and more prosperous economy—$50 trillion that would have enabled the vast majority of Americans to enter this pandemic far more healthy, resilient, and financially secure.
As the RAND report [whose research was funded by the Fair Work Center which co-author David Rolf is a board member of] demonstrates, a rising tide most definitely did not lift all boats. It didn’t even lift most of them, as nearly all of the benefits of growth these past 45 years were captured by those at the very top. And as the American economy grows radically unequal it is holding back economic growth itself.
Trump, as horrific as he is, is a symptom, not the disease.
The rich in the United States will keep pushing their toy until it breaks. Their toys have distracted them from the lessons of history.
Ack. I used that metaphor in two completely different ways. In the first sentence, the people are the toy that will break. This is inevitable. Joe Biden, are you listening? This is not sustainable. to change the metaphor, even now the peasants are gathering with their pitchforks and scythes.
The other toys of the rich–the astonishing entertainments that their wealth provides–are the distractions of the second sentence. The wealthy have always thought that the “Cēna Trīmalchiōnis” would be unending. “Unlimited” resources are a soporific.
So, lesson one for today: Don’t write as I did above. Mixed metaphors are fine–Shakespeare used them all the time–but they are not OK if they are confusing. Lesson two for today: Don’t write before having your morning coffee. Lesson three:
There’s only so much that the rich can take
until the peasants start to break.
When Adam delved and Eve span,
who was then the gentleman?
Historically, all that taking has led
to rich folks.losing their well-coifed heads.
No rich enclave is indestructible.
The Great Taking Back is ineluctable.
[delved: dug in the ground, tilled soil; span: simple past of to spin (thread)].
Perhaps teachers in the United States should take time away from training the Prole kids to apply themselves gritfully to standardized test prep exercises on the “standards” (lol) in the Gates/Coleman bullet list and put some ideas from history into their heads: https://www.bbc.co.uk/bitesize/guides/z2c2pv4/revision/1
And, when that toy, the United States, breaks, the rich will board their private jets and yachts and leave for more stable countries in the EU and Asia leaving a burning America behind.
One of the huge aggravating factors of income inequality is the systematic and and continual destruction of unions, the war on unions. From a union density of about 34% in the 1950s to the current 10.1%, in the private sector the unionization rate is less than 7%.
Well said, Brother Joe!
The destruction of unions was the goal of Koch brothers, ALEC, DeVos, Walton’s, etc. So easy to blame workers.
“The iron rule of market economies is that we all do better when we all do better.” The working class is not doing better because the 1% can buy our representatives so they only represents the interests of the 1%. The super wealthy have rigged the economy against everyone else. We need to revise ethics rules and get the money out of politics. We need to break up the big corporations to restore some notion of real markets in the economy. We need to halt the privatization of our common good.
More like the top 0.1%. There are a lot of 1-percent earners who will go broke paying for college, will not be able to afford retirement, and are one job loss and one medical emergency away from financial ruin.
Yes. This is exactly right.
The top 1% can be defined several different ways.
For 2020, it means household income was greater than $475,000
Or that individual income was at least $328,000
Or, (for 2016) that net worth was over $10 million
https://dqydj.com/top-one-percent-united-states/
1% starts at $420,000/year. Anyone making that kind of money who hasn’t saved for college and retirement, let alone emergencies, is living obscenely beyond their means.
Thank you, Dienne. It’s useful to know the low end of the 1%. There are two ways of looking at inequality: income inequality and wealth inequality. I don’t know what Bill Gates income is, but his wealth is more than $100 billion. It fluctuates. The latest update is the Bloomberg Billionaires Index.
“Anyone making that kind of money who hasn’t saved for college and retirement, let alone emergencies, is living obscenely beyond their means….”
I never understand how Trump supporters always need to present things as so black and white that it is clear who is the devil (the dems) and who is not (Trump, all Republicans, and approved progressives until they are in danger of actually having power)
Anyone who makes $420,000/year – two full time working parents – and lives in a small city with a low cost of living who hasn’t saved for college and retirement, let alone emergencies, is living obscenely beyond their means. (We all understand that assumption is made by people who believe that childcare workers should only be paid a pittance instead of half the after tax income of those parents, which would be a fair salary plus benefits.)
Also, there is a vast difference between $420,000 made by one parent – where the 2nd stays home – and $420,000 made by a single mom or two parents who both work very long hours. But if you primarily see only white families with 2 parents and one stays home and other types of families don’t matter to you, then you would certainly pretend that any family with a HHI of $420,000 is equally “living obscenely beyond their means” if they haven’t saved at least $200,000/year for each of their children for college. Because people with incomes of $420,000/year don’t get financial aid.
But these simplifications ignore an important truth — the people who live in those low-cost cities rarely make $420,000/year and the ones who do are often right wing Republicans who believe they should pay no taxes because people who don’t make $420,000/year have only themselves to blame for not being able to survive on a minimum wage/no benefit job.
When people who live in a high cost area – which are in the part of the country where those people are willing to pay higher taxes and support progressive ideas – earn $420,000, they can often not even afford a home unless they commute hours a day.
People tell them it is their fault they live with 3 kids in a 1 1/2 bedroom apartment because they refuse to leave that high cost city. But if they left that high cost city, they would not be earning $420,000/year anymore! Although they could live much better in those “non-elite” low cost cities where they could also rail against the “poors” who take their taxes and rail against “the 1%” – those “elite” 2 working parent families who vote for Democrats who live in high cost cities and don’t save enough, when they could move to join them in supporting the “non-elite” Republicans who are “so much more in touch with REAL Americans”.
It fluctuates wildly — between $90 and 110 billion.
I don’t know how he deals with going between abject poverty (90 billion) and moderate wealth (110 billion) from year to year.
Must be difficult.
According to Forbes, Gates’ “real time” net worth is $116.1 billion and he made $446 million today, since 5 pm ET of the prior trading day. He woke up, didn’t go to work, pocketed nearly half a billion dollars, and went to bed. One. Day.
Pandemics sure are profitable for the friends of Jeffrey Epstein. But hey, at least with Jeffrey Epstein, Gates admitted he made mistakes. Can’t say the same about education.
The only mistake he made was meeting with Epstein several times (because Epstein knew a lot of rich people), at least three times at Epstein’s Manhattan residence.
Oh, and having his picture taken with Epstein.
That’s two misGates.
Oh, And bragging in an email to colleagues that while at Epstein’s Manhattan palace, a very attractive Swedish woman (Epstein’s former girlfriend) and her daughter showed up and he stayed quite late.
That’s three misGates.
Oh, and riding on Epstein’s plane.
Thats four misGates.
Remind me again, how many strikes do you get in baseball?
In baseball, it’s three strikes and you’re out. In Gatesball, you get to, as Gates said he likes to do, “swing for the fences” over and over again as many times as you like, never coming close to hitting the ball, as long as your name is William Gates III.
Take me out at the Gates game
Take me out to the crowd (huddled masses yearning to be free)
Pay me some peanuts to watch Gates hack
Gates don’t care if I ever get back
For it’s root, root, root for the inning to end
If it never does it’s a shame
For it’s one, two, three, four, five, six hundred strikes and Gates is still not out
At the GatesBall game
It’s a great article. The problem is that the only people who are able to read AND understand it are in the top half of the economic food chain. The message needs to reach the masses it most affects and Time articles written by economists isn’t the way to do it.
What do we as a society need in America? Repeat after me, which is what I have been saying on this blog for years and since 9/11:
REDISTRIBUTION OF WEALTH AND POWER.
REDISTRIBUTION OF WEALTH AND POWER.
REDISTRIBUTION OF WEALTH AND POWER.
REDISTRIBUTION OF WEALTH AND POWER.
REDISTRIBUTION OF WEALTH AND POWER.
REDISTRIBUTION OF WEALTH AND POWER.
REDISTRIBUTION OF WEALTH AND POWER.
REDISTRIBUTION OF WEALTH AND POWER.
REDISTRIBUTION OF WEALTH AND POWER.
REDISTRIBUTION OF WEALTH AND POWER.
Exactly.
Now, how do we get it?
We revive the union movement in the United States.
I Agee. Unions AND regulation. Unions alone are not enough.
And a much more progressive tax system, and more public goods, like health care and prenatal care and equally funded public schools!!!!
Exactly, A high wage means nothing if your health insurance premium is $4,000 a month and child care is $1200 per kid. Basic needs that are guaranteed in other countries are something we have to now fight for and be labeled as dangerous socialist Bolsheviks . . . Americans are getting so much more educated and wise about the ruling class, but there are still too many of them who are ____________.
Educate and agitate!
The billionaires are very good at convincing us to blame ourselves instead of blaming billionaires. Blame teachers, blame cops, blame unions, blame immigrants, blame the poor for being poor,.. It’s your fault, so pull yourself up by your bootstraps and America yourself onto Easy Street!
Pull yourself up by your Gates-traps
I’d rather take the boot straps and whip them hard on the heads of Gates and Bezos. Ka-Whoosh!
Unfortunately, we are all kept down by the Gates-traps, which snapped shut the day the Conman Core was set in the schools.
Like a fur trapper, Gates has been busily setting traps in schools for over a decade now.
And what fur?
It strikes me that the problem with looking to unions to solve the problem is that unions as a force were born before automation. What are we to do when our stuff is made by robots?
One of my students’ dads works at a local manufacturer. He allowed me to tour the shop floor. There robotic arms seized the electronic items they made, testing every item with rapid motion. Each machine cost about 30,000, a year salary for an employee. How do we build an economy on machines that make things?
Perhaps the answer is in the production of things that need human beings. Art. Sports. Music.
Get ready for “Rollerball,” with the billionaires and corporations owning the teams. I’m talking about the original 1975 version with James Caan. https://en.wikipedia.org/wiki/Rollerball_(1975_film)
When we figure out how to make computer engineers, the job will be complete.
These are the people who don’t seem to care one bit about the societal ramifications of their actions (whether it be putting people out of work with automation, spying on law abiding citizens, evaluating teachers with random number generators, wrongfully arresting innocent people with their flawed face recognition software, setting up the conditions for the hacking of our elections with evoting running over pedestrians with their self-driving cars, or visiting pedophile Jeffrey Epstein )
When they are replaced by bots, it will be richly deserved — and long overdue.
Great point, Roy.
Some activities can’t be automated or outsourced.
The great irony is that the jobs that can’t be automated or outsourced are ones like farmer, plumber, electrician, carpenter, HVAC technician, etc — which don’t require a college degree.
Another irony (although not a mere coincidence) is that the people who do these jobs are often better thinkers and problem solvers than many college grads.
There is often a huge chasm between theory and practice and trades people excel in the latter.
I know because I have worked extensively with both types (eg, engineers and scientists and construction workers).
The last time I looked at Bureau of Labor Statistics projections for next decade, most jobs of the future—like construction worker, home health aide, truck driver—did not require a college degree. Teachers and nurses do
Reblogged this on David R. Taylor-Thoughts on Education.