INEQUALITY3 404

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inequality21118 capt 11/18

see pluto

billionaires

SEE FTC LINA KHAN MONOPOLY ANTI-TRUST

see financialization hedge fund/ pvt equity

new page, eventually distinct from ceo pay; this will be more about systems effects on macro level

The FTC history

IFrame Content

Amid abuses to consumers by big corporations, the Federal Trade Commission Act was passed in 1914. Antitrust enforcement by the Department of Justice dates back further, to 1903.

But the Justice Department is overseen by the attorney general, a presidential appointee. Attorneys general traditionally have had a high degree of independence, but Trump is said to be politicizing the Justice Department at a breakneck pace.

The FTC was created in part to be more independent. It’s governed by commissioners from both parties who are appointed to fixed terms that can be renewed.

Earlier this year, Trump tried to fire the two Democratic commissioners, but they say the move was illegal, and they’re fighting it in court. Antitrust advocates said Trump was doing that as a favor to his billionaire supporters such as Elon Musk.

The two Democratic commissioners, Alvaro Bedoya and Rebecca Slaughter, acted to block the Kroger-Albertson’s mega-merger, and they voted to sue Amazon, saying it is “illegally maintaining monopoly power.”

Under Jordan’s leadership, the Judiciary Committee in 2023 attacked the FTC on behalf of Musk. He’s the world’s richest man, whom Trump is allowing to make deep cuts to federal programs for the elderly, veterans, the poor, and agencies that promote science and health.

“THE WEAPONIZATION OF THE FEDERAL TRADE COMMISSION: AN AGENCY’S OVERREACH TO HARASS ELON MUSK’S TWITTER,” read the all-caps title of the Jordan-led committee’s report.

A year earlier, the FTC had charged Twitter with using deceptively gathered data from users to target ads at them. If true, it would be added to the fact that an unofficial, Musk-run entity is now collecting much more sensitive government data. It’s raised concerns among several federal judges who said such collections invite abuse and likely violate the law.

“One of Elon Musk’s Department of Government Efficiency lieutenants working in the Social Security Administration has been pushing dubious claims about noncitizens voting, apparently using access to data that court records suggest (the so-called Department of Government Efficiency) isn’t supposed to have,” NPR reported earlier this month.

The proposal from Jordan to gut the FTC could have halted major initiatives to regulate giant health conglomerates that own powerful pharmacy middlemen, said Bedoya, one of the commissioners Trump is trying to fire.

Jordan’s office didn’t respond to a request for comment on this story.

PBMs

Each of the three conglomerates — UnitedHealth Group, CVS Health and Cigna-Express Scripts — is among the 15 largest corporations in the United States. Each owns a top-ten health insurer and each owns a pharmacy middleman known as a pharmacy benefit manager, or PBM.

Combined, the PBMs control nearly 80% of the insured drug transactions in the United States. They decide which drugs are covered and use that power toextractrebates from drugmakers. They also determine varying reimbursements to pharmacies — including ones owned by their parent companies as well as the pharmacies with which they compete. Critics — including four-fifths of state attorneys general — say they have a conflict of interest under the arrangement, and that they abuse it.

Last October, the FTC sued the conglomerates, saying they used their dominance in multiple parts of the marketplace to illegally jack up the price of insulin — a drug millions of diabetics need to survive.

The lawsuit comes after the agency in 2022 undertook a major investigation of the health conglomerates. In January, it released an interim report accusing the PBMs of using their dominance to instigate wild price hikes and possibly steer business to affiliated pharmacies.

Politico recently reported that Jordan said his move to consolidate the FTC into the Justice Department was meant to “address the cost of over-regulation.”

“Part of our jurisdiction in Judiciary deals with regulatory concerns and so we are looking at … spending and costs associated with certain regulations. That’s why that language is written the way it was,” Politico reported him as saying.

Many businesses facing regulation — and their advocates in government — have long focused only on the costs. But government regulation can also protect health, safety, the environment, economic stability and competition. Some researchers have said regulation can always be smarter, but its benefits far outweigh the costs.

In a social media post last week, Bedoya, the FTC commissioner, said Jordan’s proposed changes to the agency served another agenda.

“This will gut the FTC,” Bedoya wrote. “FTC is trying to finish a study that already showed how pharmacy middlemen mark up cancer drugs by up to 4,000%. It’s also suing them for allegedly competing to raise insulin prices. If this passes I have no idea what’ll happen to that study and lawsuit.”

Bedoya added, “Take the lawsuit. The draft bill purports to transfer FTC lawyers and lawsuits to DOJ — but it doesn’t transfer the laws that FTC enforces, or authority to enforce those laws. Look (at) page 98 — employees, assets, funding — but no authorities.”

Bedoya also said that when it created the FTC, Congress meant to augment the government’s antitrust powers. Jordan’s changes would remove the government’s ability to police “unfair methods of competition,” Bedoya said, implying that Jordan was trying to slash the government’s power to police wealthy corporations in an era when the political influence of the mega-rich is exploding and the wealth gap is yawning.

“The purpose behind the FTC’s creation in 1914 was to supplement the existing enforcement mechanism (and enforcement gap created by) the Department of Justice,” Bedoya said on X. “When FTC was created in 1914, it alone was authorized to stop something called ‘unfair methods of competition.’ DOJ did not get this” under Jordan’s proposal.

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Ohio Capital Journal is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Ohio Capital Journal maintains editorial independence. Contact Editor David Dewitt for questions: info@ohiocapitaljournal.com.

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https://www.alternet.org/2020/05/how-americas-wealthiest-are-profiting-in-the-time-of-the-pandemic/

American Enterprise Institute’s (AEI) Michael Strain wrote an op-ed in the New York Times recently explaining how “The American Dream Is Alive and Well,” and that in his opinion this nation has, “bigger issues than inequality.” Strain’s piece is part of the paper’s new pandemic-era series called “The America We Need” and engages in a set of impressive mental gymnastics to conclude that it ought to be of no concern that the rich are getting richer and that it would be better to focus instead on, “the relatively slow rate of productivity growth,” or “the long-term decline in male employment.”

Michael Strain is incredulous over our fixation on the concentration of wealth at the top, asking, “Do Americans really care as much about inequality as the attention by media and liberal politicians suggest?” He adds, “Given that income inequality has been stagnant or declining over the most recent decade, the timing… is odd” for a conversation “about whether inequality suggests that capitalism itself is broken.” However, inequality continues to steadily rise—a fact it seems the pro-free-market American Enterprise Institute is hoping we ignore.

In his op-ed, Strain chants a mantra that he and other proponents of capitalism want to realize through sheer repetition: “Capitalism isn’t broken. The game isn’t rigged. Hard work does pay off.” Most insultingly, he maintains that: “American workers are resilient and are accustomed to facing—and overcoming—economic challenges.” In other words, because American workers are used to being screwed over by the economy and most have seemingly managed to survive it, they will continue to do so in the face of ever-increasing hardship.

Democratic Senator Sherrod Brown (D-Ohio) during a Senate hearing on May 19 questioned Treasury Secretary Steven Mnuchin, asking, “How many workers will die if we send people back to work without the protections they need, Mr. Secretary? How many workers should give their lives to increase our [gross domestic product] by half a percent?” Mnuchin responded, “I think your characterization is unfair,” but the Trump administration he attempted to defend has in fact forced people back to work, namely in the meatpacking industry. President Donald Trump invoked theDefense Production Act—not to direct the commercial production of much-needed medical and protective equipment, but rather to provide cover to the meat industry as it seeks to force workers back into a dangerous environment.

Thousands of workers have become infected in recent months. But if meatpacking workers contract the disease and die, it is their fault as per Health and Human Services Secretary Alex Azar, who recently claimed that it was the “home and social” conditions in the lives of meatpacking plant workers that were responsible for their COVID-19 diagnoses.He even went as far as suggesting more law enforcement surveillance of those communities where meatpacking workers live in order to police social distancing.

Making clear just how little Republicans in particular care about workers, Trump has opposed extending unemployment insurance for laid-off workers. His Labor Department has encouraged companies to snitch on workers so that their unemployment benefits are cut off if they are too fearful of returning to work. And, Senate Majority Leader Mitch McConnell wants to protect corporations from liability in coronavirus-related lawsuits by workers.

Republicans have also refused to take up any more stimulus bills even as more than 38 million Americans have lost jobs in just nine weeks. House Minority Leader Kevin McCarthy, showing just how blind he is to the pain of workers, said, “I don’t see the need right now.” Senator McConnell echoed this, saying, “I don’t think we have yet felt the urgency of acting immediately. That time could… [come], but I don’t think it has yet.” Time and again conservative politicians, in shilling for the rich, have indicated that American workers, rather than being essential, are simply expendable. This is their version of a class war.

The White House’s latest idea for helping workers is to cut corporate taxes in half as a way to incentivize overseas jobs to return to the U.S. Larry Kudlow, the White House’s top economic adviser, touted a payroll tax cut as a way to put more money into Americans’ pockets. He failed to mention that cutting payroll taxes meant a cut in payroll-tax-funded programs like Medicare and Social Security—programs many Americans rely on that the class warriors have wanted to cut for years.

Amazingly, the stock market appears to not care that there is record unemployment as week after week even with skyrocketing unemployment, the Dow Jones and Nasdaq indices remain buoyed. Indeed, the indicators that are announced with much fanfare every day on the popular radio program Marketplace have never had a real bearing on the well-being of American workers, no matter how much enthusiasm host Kai Ryssdal musters during his announcements. To his credit, he has admitted as much, explaining that the “wealthiest 10 percent of American households own 84 percent of all stocks.”

Before the pandemic, Trump bet his reelection on a low unemployment rate and the buoyancy of the stock market. Now, with official unemployment figures so incongruent with the stock market’s growth, he has a harder time making a claim of widespread economic prosperity. In fact, there was no prosperity even before the pandemic. The official unemployment rate was low, but that did not indicate how many people had quit looking for work or how poor quality those jobs were. The pandemic has exposed the fact that Trump’s claims of financial triumph were always more of a mirage than a miracle.

As the anguish of millions of American workers remains irrelevant to the corporate profiteers and their political benefactors, we are expected to rejoice in the fact that Jeff Bezos, founder and CEO of Amazon, could become the world’s first trillionaire in a few years. It would be convenient for Michael Strain and the American Enterprise Institute if we are convinced to ignore such obscenity and focus instead on workers remaining “resilient” as the rich wage their class war.

The only rational response to the absurd state of the U.S. economy is to insist that billionaires (and especially trillionaires) are simply not allowed to exist. After the first $100 million, there is no need to continue to amass any more wealth. Congress could easily enact laws to tax billionaires heavily enough that they remained more than comfortable for the rest of their lives while funding necessary services that huge numbers of Americans could benefit from: paid sick leave, Medicare for All, the Green New Deal, and so much more. There is no justification for individuals to hoard so much wealth compared to the rest of us. But they will never give up that wealth voluntarily. They will instead fight tooth and nail, lie and cheat, to preserve and expand their inconceivable riches. Against such a class war there is only one option.

Sonali Kolhatkaris the founder, host and executive producer of “Rising Up With Sonali,” a television and radio show that airs on Free Speech TV and Pacifica stations.

This article was produced by Economy for All, a project of the Independent Media Institute.

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aha omg: koch, mercer, kushner, trump all inherited money!

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520

aha:

lip service from rt, entrepreneur hero and all, but amazon bookseller no sales tax; corps get most covid bill $, must be tight w/ bank to get;

along w/ educ said to be the great way to move up/ meritocracy , but up against walmart, outsource factory, walmart is front end for china imports

no big corp loopholes subsidy like amazon warehouses new rich prime customers

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latinx/ aa 3-4x KIA? africa

almost 150 health and poverty activist campaigns, including Médecins Sans Frontières, have urged Gilead Sciences to waive patent and exclusivity rights for potential COVID-19 treatment remdesivir.

https://en.wikipedia.org/wiki/Remdesivir

https://en.wikipedia.org/wiki/Winner-Take-All_Politics

Winner-Take-All Politics: How Washington Made the Rich Richer—and Turned Its Back on the Middle Class is a book by political scientists Jacob S. Hacker and Paul Pierson. In it the authors argue that contrary to conventional wisdom, the dramatic increase in inequality of income in the United States since 1978—the richest 1% gaining 256% after inflation while the income of the lower earning 80% grew only 20%^[1]—is not the natural/inevitable result of increased competition from globalization, but of the work of political forces.^[2] Those at the very top of the economic ladder have developed and used political muscle to dramatically cut their taxes, deregulate the financial industry, keep corporate governance lax and labor unions hamstrung.^[3] Instead of a rising tide lifting all boats, the authors write, "yachts are rising, but dinghies are largely staying put" in America, and "there is reason to suspect that the dinghies are staying put in part because the yachts are rising."^[4]

1Themes
- 1.1Increase in inequality
- 1.2Debunking the "educational cause"
  - [1.2.1The top 0.1%](https://en.wikipedia.org/wiki/Winner-Take-All_Politics#The_top_0.1%)
- 1.3The "political cause" of inequality
- 1.4Politics as "organized combat"
- 1.5The two parties
- 1.6Ideas for a solution
2Reception
- 2.1Critical
- 2.2Awards
3See also
4References

Themes

The authors quote a number of luminaries on the dangers of concentrated wealth and its incompatibility with good government — Theodore Roosevelt (p. 80), Louis Brandeis (p. 81-2), Alexis de Tocqueville (p. 77), the 1st-century Greek historian Plutarch (p. 75) (An imbalance between rich and poor is the oldest and most fatal ailment of all republics), and even the father of the free market, Adam Smith (who warned of "great inequality" where "civil government" is "instituted for the defence of the rich against the poor") (p. 82).

Increase in inequality

Inflation adjusted percentage increase in after-tax household income for the top 1% and the four quintiles, between 1979 and 2005 (gains by top 1% are reflected by bottom bar; bottom quintile by top bar).[[5]](https://en.wikipedia.org/wiki/Winner-Take-All_Politics#cite_note-Aron-Dine_&_Sherman-5)

Household income levels and gains for different percentiles in 2003 dollars.[[6]](https://en.wikipedia.org/wiki/Winner-Take-All_Politics#cite_note-DeNavas,_C.,_Proctor,_B._D.,_Mills,_R._J._%28August_2004%29._Income,_Poverty,_Health_Insurance_Coverage_in_the_United_States:_2003-6)

Since the late 1970s, inequality of income in America has gotten worse across the board,^[7] but it's at the top where income has become most concentrated — concentrated at a level not seen since just before the Great Depression. Most of the gains of economic growth since the 1970s have gone to the top 1% of Americans, and most of that to the top 0.1%.^[8] While the share of America's income gains between 1979 and 2005 for the bottom middle- and lower-income 60% of the population was just 13.5% (and most of that gain came from working longer hours), the top 0.1% share was over 20%. In other words, the top 300,000 Americans gained half again as large a slice of income as the bottom 180 million.^[9] This after-tax distribution of income varies only slightly when factoring in non-cash compensation (such as health insurance and retirement pensions) distributed.^[10]

Debunking the "educational cause"

"Most economic experts" agree that the 30-year trend in America of greater inequality is a natural economic/historical trend of economic rewards for those with educational achievements and workplace skills. The authors do not. The income distribution hasn't followed a pattern of "the 29% of Americans with college degrees pulling away" from those who have less education. It's the top 1% that have pulled away from the top 20%, and most especially "the top 0.1% or even 0.01%" that has grown richer than the rest of the population.^[11]

Share of pre-tax household income received by the top 1%, top 0.1% and top 0.01%, between 1917 and 2005.[[12]](https://en.wikipedia.org/wiki/Winner-Take-All_Politics#cite_note-Piketty_&_Saez-12)^[13]

Nor has this rise in inequality taken place in many other developed economies. Western Europe and Japan, "haven't seen anything like the rise in inequality America has." Inequality in France and Switzerland has actually fallen; in Germany it's remained the same; and in Ericsson's Sweden and Sony's Japan it's moved up only slightly.^[11][14]

The relative lack of skill of American workers can't be blamed, as there isn't one. There is no gap between American workers and those of Europeans, Canadians, et al., measured in years of schooling.^[15] America's more extreme stratification has not come with any benefit of faster economic growth or more social mobility than its peer countries. Economic growth per capita was essentially the same in the US as that of the 15 core nations of Europe through 2006.^[16] America's self-image as the land of the American Dream and rags-to-riches success notwithstanding, the share of those brought up poor or middle class who succeeded in becoming rich (i.e. the social mobility), is now less than in almost all other developed countries.^[17]

Two areas related to income distribution where the US differs quite a bit from other developed countries are executive pay and unionization. Unions as a whole have been a force for raising pay and benefits for those with lower income. The percentage of workers belonging to unions has had a marked decline in the US not mirrored in other affluent countries such as America's neighbor Canada,^[18] despite a similarity in the "structural features" of the two countries economies and their workers' "propensities to join a union."^[19] Increase in the relative pay of CEOs in the US — from 24 times the earnings of the typical worker in 1965 to 300 times in 2007 — is much greater than in Europe. It takes a different form than those countries — deferred compensation, "guaranteed hours on corporate jets, chauffeurs, personal assistants, apartments, even lucrative consulting contracts". (This "camouflaged" compensation need not become public knowledge as American business law does not require its reporting.)^[20]

The top 0.1%

Besides corporate executives and managers, the other occupation/industry with large numbers of top earners are professionals in the finance industry. The two groups make up almost 60% of the top 0.1%.^[21] (In contrast, entertainment celebrities and sports superstars combined form only 3% of this elite one-household-in-a-thousand.)

While corporate management in America has benefited mightily from its capture from stockholders of boards of directors, whose nomination, pay and perks management has strong influence over.^[22] The financial industry's success has come from pushing government to deregulate that industry and making risky investments from which it has privatized the gains and socialized the losses with government bailouts.^[23]

The "political cause" of inequality

Hacker and Pierson describe the political action that has "abandoned the middle class" in the US in favor of making "the rich richer" in the last 30+ years as being the work of "modern, efficient organizations operating in a much less modern efficient political system."^[24] Those organizations strove successfully to cut taxes (estate and capital gains taxes) and tax rates for the wealthy, and to eliminate or prevent any countervailing power or oversight of corporate managers—including private litigation,^[25] efforts to empower boards of directors and shareholders,^[26] the regulation of the Securities and Exchange Commission (SEC)^[27] and labor unions.^[28]

The action in financial markets, corporate governance, industrial relations, and taxation,^[29] came from both changing policy and preventing it from being changed -- "drift". Policy changes include tax cuts and legislation such as the 1999 Gramm–Leach–Bliley Act that repealed the Depression-era Glass-Steagall Act and allowed the merger of consumer banks, investment banks, and insurance companies.

Drift, or preventing policy changes to keep "pace with changing economic conditions," included not updating labor laws in response to new corporate anti-union tactics, not enacting stock option regulations in response to changing executive pay packages, and not updating securities regulations in response to the growth of dangerously risky but profitable Wall Street speculation.^[29] One example is an attempt in 1993 by Financial Accounting Standards Board (FASB) to "moderate the explosion of CEO pay, not through burdensome interference but through the simple enforcement of honest, transparent accounting" by requiring the expensing of stock options by corporations. They were prevented by "legions of businesspeople" and intervention by congress, led by Senator Joe Lieberman.^[30] Another is the "carried-interest" loophole (costing tax payers about $4 billion/year) which allows hedge fund managers — some of the richest people in the US — to pay only 15% tax (the capital gains rate) on income they receive from investors, though the money is a paycheck received for services, not investment income.^[31][32]

Politics as "organized combat"

Though this process came as part of what the authors describe as a "transformation of American government", it has been overlooked by the public, the media, and recent political science studies. They focus on the more entertaining, fast-moving and easy-to-follow "electoral spectacle" of politicians and their campaigns for office, instead of "what the government actually does" — the more complex, and "frankly boring," organization-driven making of laws and policy.^[33] But that the latter is what is really important is reflected in how much more money is spent on lobbying (officially $3 billion a year, unofficially much more^[34]) than election campaigns",^[35] and the growth in corporate public affairs offices in the nation's capital (100 in 1968, 2500 in 1982).^[36]

These highly effective organizations include business groups like Chamber of Commerce, National Federation of Independent Business, (p. 120) anti-tax groups like Club for Growth and Americans for Tax Reform. (p. 208) Along with them came a new generation of think tanks, such as the Heritage Foundation and American Enterprise Institute. Officially non-partisan, they focused on "shifting public opinion and policy" in a conservative direction, rather than traditional `objective' policy advice.^[37]

The two parties

In the story of a winner-take-all America, the authors believe Republicans wear "black hats" and the Democrats "gray hats". The GOP stands strongly united in favor of policies favoring the wealthy, and becoming ever more extreme through the 1990s and 2000s. Their adherence to tax cuts for the wealthiest Americans exceeds all the other problems — deficit reduction, or tax cuts for the middle- or upper-middle-class — in cases such as the negotiation of the 1997 deficit reduction budget deal.^[38] This is not a position Republicans necessarily admit to, or are unaware of public resistance to. In 2001, internal memos told the Bush administration that "the public prefers spending on things like health care and education over cutting taxes", but the GOP went on with a major cut — one third of which went to the richest 1% of Americans.^[39] GOP leaders "appealed openly to bankers for financial support by touting their opposition to financial reform" following the 2008 financial crisis, while "leading GOP strategists" accused Democrats of bailing out Wall Street and "putting taxpayers on the hook," in "'populist' commercials and sound bites" for voters.^[40]

In the early 1990s, the minority party in the Senate (often the Republicans) made use of the filibuster to create "something approaching a de facto 'rule of sixty'", whereby 60 votes rather than a majority, were needed to pass laws. While only about 8% of major bills in the 1960s were filibustered, 70% were from 2000-2010.^[41] The minority Republican party could and did use the filibuster to make the reformist majority "look ineffectual" and fuel "popular disdain for politics."^[42]

Democratic "moderates", and Democrats the authors call "Republicans-for-a-day", aided the Republicans in establishing a winner-take-all system. Moderates, such as Senator John Breaux (who famously insisted that his vote could not be bought — but "it can be rented") and Max Baucus, supported pro-business initiatives such as the Bush tax cut of 2001. Unlike the Republicans — whose members seldom if ever vote with the Democrats, at least in part because the party agenda does not require challenging powerful local interests — it is not uncommon for Democrats to "defect" from their party "on specific economic issues in deference to powerful local interests." Sen. Chuck Schumer (D-NY), is a "strong liberal voice" ... on any issue except finance^[43] where he works hard for Wall Street interests that are a major part of the New York state economy; California Democrats Dianne Feinstein and Barbara Boxer (D-CA), vote with Republicans when it come to preventing stock option regulations that would impact Silicon Valley workers’ compensation.^[29] Sen. Blanche Lincoln (D-AR) includes among her constituents heirs to the Wal Mart fortune,^[44] and supported repeal of the estate tax.^[45]

Ideas for a solution

The authors emphasize the difficulty of undoing the winner-take-all transformation of America. Shrewd, charismatic leaders will not be enough,^[46] changing policy will be a "long, hard slog."^[47] The issues of stock options, financial deregulation, and tax law, and what to do about them, are "mind-numbingly complex".^[48] The rich are highly motivated, focused, and organized. The average voter is ignorant of many of the most basic facts of government, let alone "which policies to support or oppose, which politicians to vote in and out of office."^[47]

The 1890-1920 Progressive movement and New Deal serve as models of middle class reform.^[49] The way forward will require "continuing, organized capacity to mobilize middle-class voters and monitor government and politics on their behalf."^[50]

Reception

Critical

The book has won praise or compliments from Fareed Zakaria, Robert Solow,^[51] Bob Herbert (New York Times), Justin Fox (Harvard Business Review), Ed Kilgore, (Washington Monthly), Kevin Drum, (Mother Jones blog), James Fallows, (National Correspondent, The Atlantic Monthly), Elizabeth Warren (Harvard Law School), David Holahan (The Christian Science Monitor), E.J. Dionne, Jr., Robert Kuttner, Thomas B. Edsall.^[52]

###

https://www.alternet.org/2020/05/economist-thomas-piketty-coronavirus-pandemic-has-exposed-the-violence-of-social-inequality/

...AMY GOODMAN: Well, it is a great honor to have you with us. Can you talk now about how this pandemic is likely to trigger the sharpest recession in the United States since the Great Depression, perhaps a depression? Can you talk about the long-term effects of the crisis, and perhaps what can be done to ameliorate it?

:{:{}:

THOMAS PIKETTY: Right. So, you know, what I show in my new book, Capital and Ideology, is that this kind of crisis, very often in history, has a potential to change dominant views about what we should do about the economy, how we should organize our societies, the level of inequality.

So, you know, the first visible impact of the crisis is that we see the violence of social inequality. So, you know, people are not equal with respect to lockdowns. They are not equal with respect to joblessness, income loss. So, you know, you can see people who have a very small home or people who have no home, who are homeless, are in a very different situation than people who are locked down in their nice apartment or nice house.

And in terms of income support, you know, when you don’t have any wealth in saving and when you are in a very precarious labor market position, you lose your income resources very fast. And I should say that, you know, the unemployment benefit system in the U.S., in particular, is far too restrictive, and you have lots of workers who actually don’t have access to adequate income support. You have lots of people who don’t have access to housing.

And we’ve seen some of your reports, from just before, that it’s a service issue. You know, we should do more. And the U.S. government and governments around the world should do more about changing their view on what we do with housing, you know, getting urgent solutions for the people who don’t have proper housing, extending income support, making them over and beyond what we’ve been doing in the different countries.

And then we also need to start thinking about a different kind of recovery. We cannot just go business as usual with the same economic sectors again. I think it’s an opportunity to rethink about a different kind of recovery, you know, more green, more social and trying to reach a more equitable and more sustainable development model, because this is something we’ve been discussing for a long time, especially since the 2008 financial crisis. And I think, with the financing of this crisis, we are going to have to change our view about what’s a proper level of inequality in a society.

You know, we see today that all the ideologies against government action, in particular against public health systems and public investment in the hospitals, this discourse today, of course, looks very weak, given the reality of the situation. So, you know, I think this is likely to change. It has already been changed to some extent, but this needs to go much further than what we have done so far....

Income inequality is getting worse in US urban areas

https://www.alternet.org/2020/04/we-now-know-the-horrible-truth-about-trumps-so-called-stimulus/

no lnx

We now know the horrible truth about Trump’s so-called ‘stimulus’

Written by David Cay Johnston / DC Report, Raw Story April 15, 2020

A gold-plated tax giveaway infected the coronavirus relief bill that Donald Trump signed into law on March 27, Congressional Democrats complained loudly last month.

The Democrats got it wrong. The plating turns out to be pure platinum.

Almost 82% of the tax savings will go to the Trump-Kushner family and 43,000 of their fellow millionaire landlords. This rich and officially favored slice of American society consists of fewer than one in 3,550 taxpayers.

These millionaires will be excused from paying $70.3 billion in taxes out of the $86 billion the law forgives.

The savings go to real estate investors like the extended Trump-Kushner family. The provision removes limits on how much in tax benefits they can enjoy each year.

The figures were issued Tuesday by Congressional Joint Committee on Taxation. Two Democrats, Senator Sheldon Whitehouse of Rhode Island and Representative Lloyd Doggett of Texas, requested the analysis of who benefits based on income, known as a distribution table.

Using the official data, I calculate that on average each benefitting millionaire will be excused from paying $1.6 million of income taxes.

Think about how many years it takes you to earn enough to owe $1.6 million in taxes. Depending on your tax situation, you’d need an annual income of $4.3 million to $8 million. This is the level of income in need of the most pandemic relief, the actions of that Trump & Co. prove.

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https://www.alternet.org/2020/04/no-the-coronavirus-is-not-an-equalizer-black-people-are-being-infected-and-dying-at-higher-rates/

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https://www.alternet.org/2020/04/rewarding-vulture-capitalists-trump-white-house-accused-of-smash-and-grab-economics-for-weighing-tax-cut-for-rich-investors-as-workers-struggle/

no lnx

‘Rewarding vulture capitalists’: White House accused of ‘smash-and-grab economics’ for weighing tax cut for rich investors as workers struggle

President Donald J. Trump participates in a roundtable on the economy and tax reform Monday, April 15, 2019, at Nuss Truck & Equipment in Burnsville, Minn. (Official White House Photo by Shealah Craighead)

Written by Jake Johnson / Common Dreams April 6, 2020

As desperate workers, the unemployed, and small businesses struggle to obtain benefits authorized under the multi-trillion-dollar coronavirus stimulus package President Donald Trump signed into law late last month, the White House is reportedly considering an additional slate of aid measures that critics say would disproportionately favor the wealthy while providing little relief for those most in need.

The Washington Post, citing two anonymous officials familiar with White House discussions, reported late Sunday that the Trump administration is weighing “a payroll-tax cut, a capital-gains tax cut, creating 50-year Treasury bonds to lock in low interest rates, and a waiver that would clear businesses of liability from employees who contract the coronavirus on the job.”

Trump is also considering an infrastructure package, according to the Post, but the idea faces internal opposition from top advisers.

Slashing the capital gains tax, a move that would overwhelmingly reward rich investors, has long been an obsession of the Trump White House and congressional Republicans. Last year, as Common Dreams reported, Trump floated the idea of bypassing Congress to index capital gains to inflation, but never acted amid warnings that such a unilateral change would be illegal.

The Center on Budget and Policy Priorities estimated in a 2018 analysis that 86% of the benefits of indexing capital gains to inflation would flow to the top 1%.

Capital gains tax cut. No detail. But (see above) they seem to like recycling bad ideas.

So take their last bad cap gains tax idea as an e.g. of the shape of distribution you can expect from a tax cut geared to people with cap gains. I.e., regressive.https://t.co/VZfWf4t0Mv pic.twitter.com/hy6q9VVuEI

— Chye-Ching Huang (@dashching) April 5, 2020

“A capital gains tax cut would be smash-and-grab economics with no value to the economic and medical calamity facing us,” tweeted HuffPost senior reporter Zach Carter.

Critics also took aim at the other proposals under consideration inside the Trump White House, including the waiver relieving businesses of liability for workers who get sick on the job.

“Won’t somebody please think of the employers who want to coerce their employees into accepting life-threatening workplace conditions without facing legal liability,” New York magazine’s Eric Levitz tweeted sardonically.

Freelance journalist Jon Walker called the Trump administration’s reported proposals “the worst possible set of ideas for dealing with a pandemic.”

“We are beyond parody at this point,” Walker wrote. “Making it easier for people to get sick at work. Rewarding people for going into work. Rewarding vulture capitalists profiting off a crisis.”

White House deliberations over a fresh coronavirus aid package comes as the mammoth legislation Trump signed late last month is failing to get much-needed relief into the hands of people and small businesses, vindicating progressives’ warnings that the package amounted to little more than a massive bailout for big corporations replete with goodies for the well-off.

On Friday, the Trump administration launched the $350 billion small business relief program authorized under the $4.5 trillion stimulus package. But the rollout was disastrous as small businesses struggled to apply for loans and some of the biggest banks in the country sat out the process entirely as the Treasury Department failed to provide adequate guidance.

“The estimate is there are 30 million small businesses out there,” wrote David Dayen, executive editor of The American Prospect. “About 4.5% of all of them will have a chance to get relief. Half of small businesses haven’t paid rent in April, which if I’m doing the math correctly is more than 4.5%. And millions of them will have no federal help, no customers, and really no hope.”

Workers and the unemployed, meanwhile, have yet to receive the one-time $1,200 cash payments and expanded unemployment benefits to which they are now entitled under law.

As the Post reported late Sunday, “the law’s provision to boost unemployment benefits has become tangled in dated and overwhelmed state bureaucracies, as an unprecedented avalanche of jobless Americans seeks aid.”

“Millions of workers are filing for unemployment and businesses around the country are struggling to stay afloat,” said Sen. Ron Wyden (D-Ore.). “This crisis isn’t going away soon. The rise in jobless claims makes it clear Congress must continue working on the next relief bill to get Americans the help they need.”

Sen. Bernie Sanders (I-Vt.), a 2020 Democratic presidential candidate, said Friday that Congress—which is officially on recess until April 20—must move urgently to enact the “boldest legislation in history” to combat the coronavirus pandemic and the resulting economic collapse.

“We are in the midst of a COVID-19 pandemic that could lead to the death of hundreds of thousands of Americans and infect millions of others, and we are entering an economic downturn that could be worse than the Great Depression of the 1930s,” said Sanders.

The Vermont senator proposed a number of relief measures, including $2,000 in monthly payments to every person in the U.S. for the duration of the crisis and immediate suspension of all rent and mortgage payments.

“In this unprecedented moment in modern American history,” said Sanders, “it is imperative that we respond in an unprecedented way.”

---

https://www.alternet.org/2020/04/market-patriotism-returns-and-asks-workers-for-a-blood-sacrifice/

no lnx many

Market patriotism returns — and asks workers for a blood sacrifice

Written by Salon April 4, 2020

In the days after the September 11th attacks, President Bush, Mayor Giuliani and a variety of other politicians sought to soothe the ailing American psyche. They spoke publicly with a mixture of mourning and resolve. “Even grief recedes with time and grace,” Bush told the nation in his State of the Union speech.

Shortly thereafter, the nation’s leaders turned their efforts toward soothing the ailing American stock market. In a September 23, 2001 Washington Post column, former US Secretary of Labor Robert Reich noted the peculiarity of Vice President Dick Cheney’s plea for Americans to “stick their thumb in the eye of the terrorists and… not let what’s happened here in any way throw off their normal level of economic activity.” Reich dubbed this ideology “market patriotism”: the notion that “we demonstrate our resolve to the rest of the world by investing and consuming at least as much as we did before.” He noted the irony that during World War II, Americans had been asked to curb their consumption habits, but in 2001, “our patriotic duty seems to be to buy more and save less.”

Today, with the stock market once again devastated by a disaster, market patriotism is back. The social distancing rules prompted by the coronavirus pandemic have brought our economy to a standstill for two weeks now, and so the American consumer is once again being drafted into a rescue mission. President Trump briefly wanted the country “opened up and just raring to go by Easter,” despite the fact that lifting shelter-in-place and other social distancing measures would almost certainly contribute to hundreds of thousands of otherwise preventable deaths. Though Trump has more recently come to grips with the need to continue social distancing through April, it remains clear that the Right is still gearing up to send workers and consumers back into the fray before it is safe to do so.

Lloyd Blankfein, senior chairman of Goldman Sachs, tweeted that although efforts to flatten the curve are sensible “for a time,” “crushing the economy, jobs, and morale is also a health issue.” Texas Lieutenant Governor Dan Patrick said on FOX News that “as a senior citizen,” he was “willing to take a chance” on his own survival in exchange for getting Americans back to work and saving the economy for his children and grandchildren. And Glen Beck said that he “would rather die than kill the country.”

It is worth noting, of course, that Trump on his own cannot order anyone back to work—state governments, civil society, and business owners are the ones making most of these decisions. Nonetheless, if Trump and his ilk have their way, we’ll all go back to work — and back to shopping and spending and pumping dollars into an economy that badly needs the revenue, or at least, badly needs enough revenue to convince investors to pump up stock prices again. If that happens, millions of Americans will die, and the GOP appears increasingly to be okay with that.

The September 11th attacks killed 2,605 Americans. Since that day, we’ve been told again and again that avoiding another 9/11 justifies almost any expense. No military misadventure or domestic security scheme has been too extreme or too costly.One study from Brown University put the cost of our wars in Afghanistan, Iraq, Syria and Pakistan at over $6 trillion since 2001. All of this has been enacted in the name of 2,605 lives lost, and to resounding cries of “never again.”

As of April 1st, more Americans have already been lost to COVID-19 than died in the September 11th attacks. Yet many on the right Right have been cavalierly suggesting that the coronavirus has been overhyped because only two percent of those infected die from it. This was the claim made recently by Rush Limbaugh, though he did not acknowledge that such fatality rates would leave millions of Americans dead. After months of downplaying the threat posed by the virus, Trump himself is now saying that keeping the death toll below 100,000 would be “a very good job.” It seems unfathomable that the same country that so radically revamped its domestic security systems and that embarked on a doctrine of “preemptive war” around the world as a response to 2,605 American deaths could suddenly fail to care about the prospect of hundreds of thousands of American deaths (or more).

The simple answer is that our wars in Afghanistan, Iraq, and elsewhere were never about protecting Americans, as millions of protestors knew from the start. They were about oil. They were about a wounded sense of American innocence. They were about a kind of vengeance for America’s failure in Vietnam. They were about profiteering — disaster capitalism, as Naomi Klein has aptly diagnosed it. But they were not about protecting anyone.

The enormous stimulus bill, signed into law last week with the near-unanimous support of Republicans and Democrats in Congress, further illustrated these principles. Despite the fact that most reporting lists its price tag at a whopping $2 trillion, the real cost is likely to be closer to 6 trillion — the Federal Reserve is going to be able to lend an additional $4 trillion to major corporations, on top of the $500 billion or so in direct bailout funds that has been more widely reported on.

The effects of the bill will be devastating for workers, the middle class, and small businesses.According to critics like Matthew Stoller, this bill gives Wall Street the ability “to go shopping for businesses in trouble. We could see the mother of all roll-ups, as small and medium sized businesses desperately try to get whatever they can from deep-pocketed private equity investors and monopolists. If that happens, America could look like a very different country after this pandemic is over.”

And as David Dayen put it in The American Prospect, “this is a rubber-stamp on an unequal system that has brought terrible hardship to the majority of America. The people get a $1,200 means-tested payment and a little wage insurance for four months. Corporations get a transformative amount of play money to sustain their system and wipe out the competition.”

Market patriotism used to mean that average citizens were urged to keep spending during periods of uncertainty. Now it demands blood sacrifice. Our leaders want us back to work, getting sick, and if need be, dying to please the market. They want to throw us crumbs while further enabling the consolidation of the economy in the hands of an ever-smaller group of ever-larger corporations. Though the outsized influence of billionaires and big corporations was a source of heated discussion during the Democratic primaries, this bill is a triumph for the ultra-wealthy financiers who already control so much of American life.

In the end, Americans all know that we have suffered and sacrificed too much for the market already. It doesn’t have to be this way. Those who can continue to stay home must do so. But we must also stand in solidarity with those who don’t have a choice — we must refuse to order from Instacart and Amazon, whose workers are now on strike for better wages and working conditions, and support other labor actions in the future. We must do what we can to help each other, and to protect ourselves. Our leaders, and the market they serve, will certainly not protect us now. They never really have.

Timothy Recuber is an Assistant Professor of Sociology at Smith College, and the author of the book “Consuming Catastrophe: Mass Culture in America’s Decade of Disaster.” His work focuses on the mass media’s representation of death and disaster, and his research has been published in journals such as New Media & Society, the American Behavioral Scientist, Research Ethics, and Contexts. Find him on Twitter @timr100.

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covid acclerating, amplifying inequality?!

https://www.alternet.org/2020/03/how-little-trump-cares-for-workers-and-how-much-he-values-corporate-swamp-monsters-is-now-on-full-display/

How little Trump cares for workers — and how much he values corporate swamp monsters — is now on full display

Written by David Cay Johnson / DC Report, Raw Story March 17, 2020

This article was paid for by Raw Story subscribers. Not a subscriber? Try us and go ad-free for $1. Prefer to give a one-time tip? Click here.

The Trump pandemic response stimulus plan, shown first to Senate Republicans, proposes $100 billion for workers. The thin gruel Trump’s team proposes recalls famous 1980 Boston Globe headline mocking President Jimmy Carter: More Mush from the Wimp.

Donald Trump may have finally realized the coronavirus pandemic is real, but he hasn’t a clue about the price in lost wages, not to mention lost lives, that Americans workers will pay for his lethargic incompetence.

Workers would get maybe $100 billion, corporations $850 billion. Airlines would get $50 billion, half as much as workers, Treasury Secretary Steve Mnuchin told Senate Republicans.

While $100 billion sounds like a big number, its bupkis compared to the scope of the job loss problem.

American workers gross about $150 billion per week, IRS Table 1.4 shows.

Distribute $100 billion equally to the 168 million or so people who earn from $1 to more than $100 million in annual wages and it’s not enough to replace a week’s wages.

Restricting help to the bottom half of workers, who made just under $33,000 in 2018, wouldn’t be much better. Trump’s plan would not even replace two weeks of pay to the more than 83 million low-paid workers.

Trump said Monday that he expected the pandemic to continue into July and August. That would be 24 weeks, not two.

We’ve already seen the Federal Reserve jump in with help for Wall Street, where the large spoons with which bankers used to take in welfare have been replaced with giant buckets.

The Fed slashed bank borrowing rates to as little as zero while offering to trade as much as $700 billion in cash for other securities to ensure financial firms can cover their obligations. Heaven forbid the bankers set aside enough reserves to cover a rainy day or a pandemic.

Bankers first, American workers last is not a Trump era creation. But it is promoted with gusto. And it contradicts the core promise on which Trump beguiled almost 63 million people into casting ballots for him.

Trump was all about “the forgotten men and women” of America, both as a candidate and in his inaugural address.

In accepting the Republican nomination for president in July 2016 Trump declared, “The forgotten men and women of our country — people who work hard but no longer have a voice: I am your voice.”

That promise died as soon as he left the Capitol for the White House.

The man who tried to con us with his absurd claim that coronavirus was a hoax, a “foreign virus,” and that the initial first 15 coronavirus cases in America would soon be zero, and who insisted over the weekend that virus was “under tremendous control” doesn’t have a clue.

Many Americans will die because of his incompetence and denial of reality.

For the majority who survive, even with state jobless benefits, which most workers don’t qualify for, Trump’s economic stimulus is itself a hoax.

Its money aplenty for the swamp monsters Trump promised to slay and starvation wage replacement for their prey.

So maybe instead of “More Mush from the Wimp,” the smart headline would be: Trump Feeds Workers to the Swamp Monsters.

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How the T-Mobile-Sprint merger will increase inequality

Amitrajeet A. Batabyal, Rochester Institute of Technology

The T-Mobile-Sprint merger is the latest example of weakened enforcement of antitrust laws, which reduces competition and exacerbates already-record levels of inequality.

aHA: 1% extractive, makes $ on $, debt, rent-seekers, the rest of us pay off debt/rent (now literally since 1% buys houses and apts, leverage like 2008 bust?!]

https://www.alternet.org/2020/01/here-are-4-reasons-why-millennials-dont-have-any-money-robert-reich/

no lnx vid

Here are 4 reasons why millennials don’t have any money: Robert Reich

Written by Robert Reich / Robert Reich's Blog January 12, 2020

The same forces that are driving massive inequality between the top 1 percent and the rest of us are creating a vast generational wealth gap between baby boomers — my generation — and millennials.

Millennials aren’t teenagers anymore. They’re working hard, starting families and trying to build wealth. But as a generation, they’re way behind.

They’re deeper in debt, only half as likely to own a home, and more likely to live in poverty than their parents.

If we want to address their problems, we need to understand those problems.

Number one: Stagnant wages. Median wages grew by an average of 0.3% per year between 2007 and 2017, including the Great Recession – just as millennials were beginning their careers. Before that, between the mid-1980s and mid-1990s, wages grew at three times that rate.

Second: As wages have stagnated, the costs of essentials like housing and education have been going through the roof. Millennials own fewer homes, the most common way Americans have built wealth in the past. Education costs have soared. Adjusted for inflation, the average college education in 2018 cost nearly three times what it did in 1978.

Third: As a result of all of this, Debt.That expensive college education means that the average graduate carries a whopping $28,000 in student loan debt. As a generation, millennials are more than one trillion dollars in the red. In addition, the average young adult carries nearly $5,000 in credit card debt, and this number is growing.

Fourth: Millennials are finding it harder than previous generations to save for the future.Among Fortune 500 companies, only 81 sponsored a pension plan in 2017, that’s down from 288 twenty years ago. Employers are replacing pensions with essentially “do-it-yourself” savings plans.

All of this means that fewer millennials are entering the middle class than previous generations.Most have less than $1,000 in savings. Many young people today won’t be able to retire until 75, if at all.

If we don’t start trying to reduce this generational wealth gap — through policies like debt relief, accessible health insurance, paid family leave, affordable housing, and a more equitable tax code for renters — millions of young Americans will struggle to find financial security for the rest of their lives.

an 1/22/20

Inequality and development

Wealth gap widening for more than 70% of global population, researchers find

Policymakers urged to act on climate and bridge digital divide as study shows soaring inequality is affecting millions

Global development is supported by

About this content

Sam Phan

Wed 22 Jan 2020 07.46 EST

Social and economic disparities have soared even in countries such as Argentina, Brazil and Mexico, where inequality had been falling in recent decades, found the World Social Report.

If nothing is done to address the problem, the prosperity and development of millions of people could be damaged.

“If we don’t act now, the entrenched inequalities that are already there will worsen,” said Elliott Harris, chief economist and assistant secretary general for economic development in the UN Department of Economic and Social Affairs.

But he added: “What is changing now is that there is a greater awareness that this inequality is having consequences and [causing] social upheavals. It’s something we’ve known for some time, but it hasn’t gotten the recognition.”

The report said that while international inequality has declined in relative terms, the absolute gap between the average incomes of people living in high- and low-income countries has doubled since 1990.

Rising inequalities are benefiting the wealthiest. Top income tax rates have fallen in all countries, which have made tax systems less progressive. In wealthier countries, the top income-tax rates have dropped from 66% in 1981 to 43% in 2018.

The income gap has been exacerbated by the climate crisis. The report estimates that the gap between the richest and poorest 10% of the global population is 25% larger than it would be in a world without global warming.

The UN said better use of technology, tackling the climate crisis and improved management of migration and urbanisation could help reduce the inequalities, a target of the UN global goals.

Climate, inequality, hunger: which global problems would you fix first?

Almost 87% of people living in wealthy countries have internet access compared with 19% in the least developed countries, creating a digital divide that will increasingly marginalise low-skilled workers, said the report.

It added that the impact of the climate crisis threatened to reverse progress on reducing inequality, as the communities most affected by the impact of global heating will find it increasingly hard to escape poverty.

A transition towards greener economies could help combat inequality, said the researchers. Although millions of lower-skilled jobs in carbon-intensive industries will be lost, carefully designed adaptation strategies could create 24m new jobs, they predicted.

Meanwhile, better urban planning and city management could improve the lives of more than 1 billion people who currently live in slums, often with little access to decent sanitation, clean water or energy.

Better migration policies and lower transaction costs for family remittances would also allow millions of people to pursue better opportunities and improve their lives, added the report.

“It is difficult to address inequality, but it can be successfully reduced. We need to agree on the need and the policy, and then address it,” said Harris.

“This is not [our] destiny. If we act now through policy, we can deliver better outcomes.”

CEOs make more in first week of January than an average salary. Here’s the solution

Tobore Okah-Avae, The Conversation

Nobody else, apart from CEOs, has enjoyed a similar rise in their fortunes since the 1980s.

...

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https://www.alternet.org/2020/01/i-made-a-lot-of-bankers-look-very-good-trump-lets-the-mask-slip-as-wall-street-titans-get-32-billion-tax-windfall/

no lnx

‘I made a lot of bankers look very good’: Trump lets the mask slip as Wall Street titans get $32 billion tax windfall

Written by Jon Queally / Common Dreams January 17, 2020

“I made a lot of bankers look very good,” President Donald Trump boasted this week just before it was reported Thursday that the nation’s six largest banks alone have received an estimated $32 billion windfall thanks to Republican tax cuts.

The figures were generated by Bloomberg News after reviewing the 2019 profits earnings of JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs, and Morgan Stanley.

By looking at the banks’ earnings in relation to effective tax rates that dropped from 20% to 18% last year—and comparing that to the 30% average they paid prior to the tax cut bill passed by Republicans and signed by Trump at the end of 2017—the analysis showed just how well the Wall Street giants have fared even as they cut back their work forces approximately 1,200 people over the same time period.

“The tax savings have spurred the banks to record profit,” Bloomberg‘s Yalman Onaran reported. “The six firms posted $120 billion in net income for 2019, inching past 2018’s mark. They had never surpassed $100 billion before the tax cuts.”

Joe Weisenthal

@TheStalwart

EXCLUSIVE calculation from Bloomberg...

Trump's tax cuts have allowed the 6 biggest banks in America to save $32 billion. https://www.bloomberg.com/news/articles/2020-01-16/trump-tax-cut-hands-32-billion-windfall-to-america-s-top-banks?srnd=premium … via @Yalman_Onaran

Morris Pearl, chair of Patriotic Millionaires, which advocates for higher taxes on the wealthy and large corporations, said the latest figures only further prove what critics of the Republican tax giveaway knew and predicted since it was first proposed—that it was a gift to big banks and a scam perpetrated against Trump by regular people.

“The Trump administration touted that the average American was going to get $4,000 from their signature tax legislation,” Pearl told Common Dreams. “If you average six bank executives getting $32 billion while millions of people get $0, maybe that does average to $4000 per person. It’s still reprehensible and fiscally irresponsible that just six banks got a $32 billion windfall while ordinary Americans are struggling.”

On social media, his group broke the numbers down by bank:

Patriotic Millionaires

@PatrioticMills

Big banks savings from #GOPTaxScam

JPMorgan

2018: $3.7 billion

2019: $5 billion

Bank of America

2018: $3.4 bn

2019: $4 bn

Wells Fargo

2018: $3 bn

2019: $3.3 bn

Citi

2018: $1.7 bn

2019: $2.8 bn

Morgan Stanley

2018: $1 bn

2019: $1.4 bn

Goldman Sachs

2018: $1.2 bn

2019: $1 bn

“It looks like Trump just let the six largest banks ‘get away with murder’ something he promised he wouldn’t do as president,” said Warren Gunnels, senior advisor to Bernie Sanders, in response to the reporting. “We need to break up these big banks and tax Wall Street to cancel all student debt.”

Warren Gunnels@GunnelsWarren

It looks like Trump just let the 6 largest banks "get away with murder" something he promised he wouldn't do as president.

We need to break up these big banks & tax Wall Street to cancel all student debt.

That's exactly what #PresidentSanders will do. https://www.bloomberg.com/news/articles/2020-01-16/trump-tax-cut-hands-32-billion-windfall-to-america-s-top-banks …

Trump Tax Cut Hands $32 Billion Windfall to America’s Top Banks

Savings for the top six U.S. banks from President Donald Trump’s signature tax overhaul accelerated last year, now topping $32 billion as the lenders curbed new borrowing, pared jobs and ramped up...

bloomberg.com

Trump’s comments about his role in the bankers’ bonanza were made Wednesday when he gathered with top financial executives at the White House to celebrate a trade deal with China.

“They just announced earnings and they were incredible,” Trump said to Mary Erdoes, who heads asset and wealth management for nation’s largest bank, JPMorgan Chase. As American Banker reports, Trump then asked Erdoes “for reciprocation” in the form of a thank you from the bank.

“They were very substantial,” Trump said to Erdoes of the tax savings and profits. “Will you say, ‘Thank you, Mr. President,’ at least, huh?”

an 1/20

How colleges can help reverse regional inequality

Anne Kim / Washington Monthly

Most of us know by now that the richest Americans are getting even richer. What’s less well known is that America’s richest places are getting richer too. From 2005 to…

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rental housing becomes the next bubble gt recession CDS? blackstone

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https://www.reuters.com/article/us-global-housing-rights/global-investors-wreaking-havoc-on-low-income-renters-u-n-says-idUSKCN1R71L5

3/19

(Thomson Reuters Foundation) -Large investment firms are worsening global housing shortages by forcing vulnerable out of low-income homes and upgrading them for higher rents, said United Nations human rights experts, who appealed to countries to tighten up regulation.

These firms had become the world’s biggest landlords, and “converted homes into financial instruments and investments”, said Leilani Farha, U.N. Special Rapporteur on the right to adequate housing, in a statement released Tuesday.

“Landlords have become faceless corporations wreaking havoc with tenants’ right to security and contributing to the global housing crisis,” she said.

Farha and Surya Deva, chairman of the U.N. Working Group on business and human rights, wrote to Blackstone Group LP, the world’s largest private equity firm, and authorities in Denmark, Ireland, Spain, Sweden, the United States and Czech Republic.[have laws that req action; US not sign treaties/agreement int'l]

Preferential tax laws and weak tenant protections in these countries have left vulnerable communities at risk of eviction and homelessness, they said.

“We remind all States, that while gold is a commodity, housing is not, it’s a human right,” they said.

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https://www.alternet.org/2019/12/worlds-500-richest-people-gained-1-2-trillion-in-wealth-in-2019-analysis/

no lnx graf

World’s 500 richest people gained $1.2 trillion in wealth in 2019: Analysis

Written by Jake Johnson / Common Dreams December 27, 2019

The 500 richest people in the world, all of whom are billionaires, gained a combined $1.2 trillion in wealth in 2019, further exacerbating inequities that have not been seen since the late 1920s.

That’s according to a new Bloomberg analysis published Friday, which found that the planet’s 500 richest people saw their collective net worth soar by 25 percent to $5.9 trillion over the last year.

“In the U.S., the richest 0.1 percent control a bigger share of the pie than at any time since 1929,” Bloomberg noted. “The 172 American billionaires on the Bloomberg ranking added $500 billion, with Facebook Inc.’s Mark Zuckerberg up $27.3 billion and Microsoft Corp. co-founder Bill Gates [rising] $22.7 billion.”

According to the Bloomberg Billionaires Index, eight of the 10 richest people in the world are from the U.S.

Amazon CEO Jeff Bezos lost nearly $9 billion in wealth in 2019, according to Bloomberg, but he will still likely end the year as the richest man in the world with a total net worth of $116 billion.

The analysis comes as 2020 Democratic presidential candidates, particularly Sens. Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.), have made tackling inequality a key component of their policy platforms.

Warren has proposed an annual two percent tax on assets over $50 million and a three percent tax on assets above $1 billion.

Sanders, who has said he does not believe billionaires should exist, is calling for a wealth tax that would slash the fortunes of U.S. billionaires in half over 15 years, according to his campaign.

“A small handful of billionaires should not be able to accumulate more money than they could spend in 10 lifetimes,” Sanders said in September, “while millions of Americans are living in poverty and dying because they can’t afford healthcare.”

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tom d 1219

...Keep in mind the context for so much of this: it’s happening in a country that may be experiencing an unprecedented kind of inequality. It’s producing billionaires at a staggering clip with just three men already possessing wealth equivalent to that of half the rest of the population; this, mind you, at a moment when the globe’s 26 richest people reportedly are worth as much as half of everyone else, or 3.8 billion people. And this in a world in which, as the income of that poorest half of humanity continues to decline, the wealth of billionairesincreases by $2.5 billion a day and a new billionaire is minted every two days.

1219

https://www.alternet.org/2019/12/staggering-new-data-shows-income-of-top-1-percent-has-grown-100-times-faster-than-bottom-50-percent-since-1970/

Staggering’ new data shows income of top 1 percent has grown 100 times faster than bottom 50 percent since 1970

Julia Conley / Common Dreams

“The bulk of a generation of economic growth has been captured and concentrated in a few hands, and many people have barely seen any of it.”

no lnx grafs

‘Staggering’ new data shows income of top 1 percent has grown 100 times faster than bottom 50 percent since 1970

Written by Julia Conley / Common Dreams December 10, 2019

New data released Monday explains the numbers behind Sen. Bernie Sanders’ often-cited statistic that the three richest Americans hold more wealth than the 160 million people who make up the bottom 50% of the population.

Washington Post columnist Greg Sargent published what he called “stunning” findings from UC Berkeley economist Gabriel Zucman, showing how both an explosion in annual earnings by the rich and an increasingly regressive tax structure have combined to allow the top 1% of Americans’ wealth to triple over the past five decades.

:{:{}:

Meanwhile, working people are taking home just $8,000 more per year than they did in 1970.

In what Sargent called “the triumph of the rich, which is one of the defining stories of our time,” the richer a household is, the more its take-home wealth has grown in the past 50 years.

New data:

For top 1%, average income has risen by $800,000 since 1970.

For top 0.1%, it has risen by $4 million.

For top .01%, it has risen $20 million.

Bottom 50%? $8,000.

All this is *after taxes and transfers.*

Great work from @gabriel_zucman:https://t.co/iaxntlHdvl

— Greg Sargent (@ThePlumLineGS) December 9, 2019

The top 1% of earners make an average of more than $1 million per year after accounting for taxes they pay, a 50-year increase of more than $800,000—100 times the growth rate of the bottom 50%.

:{:{}:

The wealth of the top .1% is five times larger than it was in 1970, while that of the top .01% is seven times larger, at over $24 million in 2018.

Zucman and fellow economist Emmanuel Saez, his co-author of the new book “The Triumph of Injustice,” provided a chart showing how each group of earners’ take-home pay has changed since 1970. The wealthiest Americans’ assets skyrocketed by millions of dollars even in the first decade of the 21st century—when people in the bottom 50% saw their average take-home income decrease.

For middle-income earners since 1970, income-plus-effective tax rates have gone from $44,000 to about $75,000—a greater increase than those in the bottom 50% of earners, “but still their income growth rate has been very low,” Zucman told the Post.

Zucman, who with Saez advised Sen. Elizabeth Warren (D-Mass.) on her Ultra-Millionaires Tax, emphasized that both the explosion of yearly income at the top and the effective tax rates of people in all income brackets must be taken into account to understand the massive wealth gap.

“You have two trends reinforcing each other,” Zucman told the Post. “There has been the rise in market income inequality—the rise in pretax income inequality. At the same time, the tax system has become much less progressive at the top of the income distribution.”

“People have this idea that government redistribution has upset some of the rise in inequality, but essentially that’s not the case,” the economist added.

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Zucman’s findings were revealed two months after New York Times columnist David Leonhardt published a graphic showing how in 2018, for the first time in U.S. history, the 400 richest Americans paid less in taxes than any other income group.

The richest Americans have benefited from numerous changes to tax laws and enforcement in recent decades, Sargent wrote, “including domestic and international tax avoidance, the whittling away of the estate and corporate taxes, and the repeated downsizing of top marginal rates.”

Tony Annett of the Center for Sustainable Development at Columbia University wrote that Zucman’s research shows how “it is no longer meaningful to rely on GDP” as a measure of economic well-being, since the benefits of growth are no longer being shared among all earners as they were in previous eras.

With this kind of distribution, it is no longer meaningful to rely on GDP, not even accounting for its other deficiencies. GDP became a widely used measure of economic well-being at a time when the benefits of growth were shared widely. https://t.co/IIL5EYMMGy

— Tony Annett (@tonyannett) December 9, 2019

Seth D. Michaels of the Union of Concerned Scientists described Zucman’s findings as showing how many people of his generation have seen the bulk of economic growth “captured and concentrated in a few hands.”

even if you know that inequality is increasing, the scale is staggering to consider. the bulk of a *generation* of economic growth has been captured and concentrated in a few hands, and many people have barely seen any of it. https://t.co/XldPkUoIM9

— Seth D. Michaels (@sethdmichaels) December 9, 2019

“The tiny number of people raking in the overwhelming majority of the last 40 years of economic growth are distorting the economy and the political system like a black hole, everything falling toward their interests at high speed,” Michaels wrote.

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https://www.alternet.org/2019/11/radio-host-thom-hartmann-explains-how-we-could-slide-into-straight-fascism-in-the-next-year

c de v

...one one thing that causes me to think that we might not — and which is the subject of my new book “The Hidden History of the Supreme Court and the Betrayal of America” — is how the United States Supreme Court has basically betrayed our country. The definition of a democracy is where the people vote for what they want and then they get that through the government. That has not been the case since 1981.

Whether it’s the social safety net, protecting the environment, decreasing our military activity abroad, making policing more humane, recognizing civil rights, encouraging voter rights, strengthening the middle class and protecting Social Security and Medicare, none of those things have happened. In fact, the opposite has happened.

How is Trumpism a symptom and not the cause of much bigger social, political, economic and other cultural problems in America? Renewing the country’s democracy to prevent another fascist president is going to require deep systemic change, not just voting Donald Trump out of office.

The thing that concerns me the most is that in the United States we now have corporations and billionaires who have taken over our political system completely. Social scientists have shown that what the bottom 90% of income earners want in America is literally random noise for America’s policymakers. By comparison, what the top 10% want is consistently enacted through legislation. This means no more democracy. And then on top of that power dynamic the courts have swung to the far right and are hard corporatist.....

https://www.alternet.org/2019/11/how-progressive-lawmakers-seek-to-take-on-the-egregious-scale-of-ceo-pay/

no lnx

How progressive lawmakers seek to take on the egregious scale of CEO pay

Written by David Atkins / Washington Monthly November 15, 2019

Tackling wealth inequality is admittedly hard. The rich have access to very good accountants, lawyers, and lobbyists. There are a lot of places for them to stash their wealth. Loopholes are easy to create. Not to mention, they can always move (although they don’t carry out the threat nearly as often as conservatives would have you believe) if they really don’t like or can’t escape the tax bill.

Solving the problem requires a variety of approaches from many different angles: wealth taxes, financial transaction taxes, estate taxes, corporate taxes, loophole elimination, campaign finance changes, tax haven penalties, etc. Any one of them may fail, or be easy for certain classes of individuals to escape. Collectively, however, they can both put a dent in the deficit allowing for greater expenditures on social services and climate change abatement. More importantly, they can reduce the corrosive wealth inequality that is eating away at our democracy. Reducing the amount of the money hoarded by the obscenely wealthy would be a good thing on its own merits, even if it were merely burned in a bonfire rather than added to the Treasury.

That’s why a new proposal from a bevy of progressive lawmakers comes as a welcome and innovative addition to the policy arsenal: increasing the corporate tax rate in accordance with the gap between CEO pay and median worker pay. Here’s the general idea:

Sen. Bernie Sanders (I-Vt.), Rep. Barbara Lee (D-Calif.) and Rep. Rashida Tlaib (D-Mich.) introduced the Tax Excessive CEO Pay Act, which rewrites the federal tax code to tackle the inequality crisis created by corporate America’s unrestrained greed.

The typical restaurant employee at McDonald’s would have to work for more than 2,000 years to earn what the company’s CEO Chris Kempczinski received last year. A retail worker at Gap Inc. would have to work for more than 3,000 years to receive the annual compensation of Gap’s former CEO Art Peck. Peck’s pay was increased by 33 percent in 2018, even after he presided over years of declines in sales and stock prices.

The Tax Excessive CEO Pay Act would pressure corporations to curb these outrageous pay gaps that are the norm today, by imposing graduated taxes for companies that pay their CEO more than 50 times the pay of the median worker. The tax penalties would begin at 0.5 percentage points and rise to 5 percentage points for firms compensating their chief executives at more than 500 times the rate of their workers. A recent report by the Institute for Policy Studies found that 80 percent of S&P 500 firms paid their CEOs more than 100 times the pay of their median worker.

Many of the firms lavishing multi-million-dollar compensation packages on their top executives rely on taxpayer support—through public housing, nutrition assistance, and Medicaid, for example—to assist full-time workers who struggle with poverty wages.

CEO pay around the world, and especially in the United States, has become outrageous. While the average worker has only seen their compensation grow by 12 percent since 1968, the pay of the average CEO has increased by a whopping 940 percent since 1978. It’s not just an outrageous injustice that so many workers are being laid off, off-shored, and made insecure while the top executives make a killing. It also offends our very sense of how the economy is supposed to work: after all, it’s not as if CEOs are now a thousand times more productive than they were 40 years ago.

In fact, the opposite is true: CEOs used to stick with a company for nearly a lifetime, their own reputation and financial well-being tied to the company’s. Now, they’re migrant mercenaries goosing quarterly profit in the short term while leaving the next guy holding the bag to deal with the consequences of the corners they cut. It breaks our understanding of the social and moral compact that underpins the political economy and the credibility of modern capitalism itself as an economic system. It would be great to pass the money being funneled to CEOs back to workers either in the form of wages or social program redistribution. But failing that, it would serve a valuable social good just to burn that money in a fire rather than continue to deliver it to the undeserving rich to buy another yacht.

Critics will call this a gimmick that doesn’t singlehandedly solve the problem, but ultimately, that isn’t the point.

First, it delivers a key political message: we understand that the economy is broken, that the social fabric is fraying, that the wrong people are being overcompensated for the wrong reasons, and that we intend to do something about that specifically.

Second, it attacks one of the aspects of wealth inequality in a direct, pre-distributive way. Rather than trying to claw back money from the obscenely wealthy after it has already been paid out, it incentivizes corporations not to give it to them in the first place. It puts coolant in the overheating engine that has been sending CEO pay skyrocketing to absurd levels in a chummy bidding war in the hands of a class of executives all too happy to distribute egregious sums to their friends and fellows.

Obviously, unless Democrats can both win the Senate and bypass the filibuster, this policy is dead on arrival against a wall of GOP obstruction. But it’s good to have in the back pocket in the meantime, and it would serve as excellent policy to campaign on as we approach the 2020 election, reminding the American people who is actually on the side of the average worker to build a fairer economy.

David Atkins is a writer, activist and research professional living in Santa Barbara. He is a contributor to the Washington Monthly’s Political Animal and president of The Pollux Group, a qualitative research firm.

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https://www.alternet.org/2019/11/the-plutocrats-most-effective-secret-weapon-is-the-u-s-tax-code/

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The plutocrats’ most effective secret weapon is the U.S. tax code

Written by Jim Hightower / Creators Syndicate November 12, 2019

I should start this homily on inequality by distinguishing income from wealth. Income is your annual wages or salary, as well as your earnings from a business, pension or government benefits such as Social Security, etc.

As the average U.S. worker’s real wages have stagnated for more than a decade, income disparity has become enormous. The bottom 90% of us average $30,000 a year, while the top 0.01% and 0.001% (about 1,400 taxpayers) rake in average annual incomes of $35.1 million and $152 million, respectively.

Meanwhile, even mediocre CEOs pocket many millions a year, and the greediest Wall Street hucksters annually amass more than $1 billion in booty. Until relatively recently, the ethical standard was for workers to gain a proportionate share of the income growth we generate. But in the last dozen years, the rich have been gobbling more and more of the total income pie, so the bottom half of Americans now get only 14%.

As gross as income inequality is, though, it’s dwarfed by the lesser-known wealth disparity that has engulfed our land, mocking our egalitarian pretensions.

Wealth is your net worth, the total financial value of every asset you own: your home(s), business, stocks, cash, real estate, cars, yachts, jewels, gold, art, toys and … well, everything, minus debts.

Startling statistic: 1 in 5 Americans have zero net worth — or less. Many of us owe more than we own and, living paycheck to paycheck, can’t get ahead to build a nest egg.

More startling statistic: U.S. wealth disparity is the greatest of any advanced economy in the world, with the richest 1% holding more of our nation’s wealth than the bottom 90% of us.

Even more startling: Just three Americans — Jeff Bezos (Amazon), Bill Gates (Microsoft) and Warren Buffett (Berkshire Hathaway) — possess more personal wealth ($248 billion) than the entire bottom half. Yes, more than 165 million of us combined.

The rapidly widening divide between the rich and the rest of us is neither natural nor accidental. During the past half-century, myriad corporate and governmental decisions — from labor law to campaign finance regulations — have methodically slanted America’s economic and political systems so that money and power flow from the many to the few. The plutocrats’ most effective and least reported-on tool is America’s tax structure.

For most of us — workers, professionals, farmers, small-business folks, etc. — income taxes are generally straightforward. The rich are different. Multimillionaires and billionaires don’t usually draw the bulk of their fabulous incomes from paychecks but from their enormous financial assets, i.e., their wealth. This inherited or accumulated wealth generates “capital income” — and further wealth — with little or no work by the asset holder.

As the Center for American Progress’ excellent report “Ending Special Tax Treatment for the Very Wealthy” details, the moral basis of U.S. tax policy has been perverted since the 1980s by legislative and regulatory twists that tax work but let these massive accretions of wealth skate by virtually untouched. Thus, the ultrarich, who benefit the most from our country’s economy and public infrastructure, pay the smallest proportion of their incomes to sustain it.

Today’s tax laws offer a carnival of loop-the-loops, whirligigs and other tax-free joyrides for those who’ve stockpiled capital income. For example, while you might pay the top tax rate of 37% on ordinary income, someone selling a capital asset like stock pays only 20% tax on income from that sale.

Nearly 70% of such capital gains are made by America’s richest 1%,who reap trillions of dollars a year in savings through such special tax treatments. This windfall allows them to amass and concentrate even more of America’s wealth in their sheltered accounts and buy the political clout to push through laws that the great majority oppose — such as 2017’s Trump-McConnell trillion-dollar tax giveaway to the rich. (Facing overwhelming public opposition, the GOP wrote the bill behind closed doors, allowed no public hearings and rammed it into law on a partisan vote.)

And round and round it goes … unless and until we stop it.

Read the Center for American Progress’ report.

Center for American Progress’ report.

Populist author, public speaker and radio commentator Jim Hightower writes “The Hightower Lowdown,” a monthly newsletter chronicling the ongoing fights by America’s ordinary people against rule by plutocratic elites. Sign up at HightowerLowdown.org. COPYRIGHT 2019 CREATORS.COM

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https://www.alternet.org/2019/11/the-plutocrats-most-effective-secret-weapon-is-the-u-s-tax-code/

no lnx

The plutocrats’ most effective secret weapon is the U.S. tax code

Written by Jim Hightower / Creators Syndicate November 12, 2019

As gross as income inequality is, though, it’s dwarfed by the lesser-known wealth disparity that has engulfed our land, mocking our egalitarian pretensions.

Startling statistic: 1 in 5 Americans have zero net worth — or less. Many of us owe more than we own and, living paycheck to paycheck, can’t get ahead to build a nest egg.

More startling statistic: U.S. wealth disparity is the greatest of any advanced economy in the world, with the richest 1% holding more of our nation’s wealth than the bottom 90% of us.

And round and round it goes … unless and until we stop it.

Read the Center for American Progress’ report.

Center for American Progress’ report.

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AHA: VOODOO 2017 TAX CUT AND CDS HOUSING --> RENT-SEEKING/ EXTRACTION BIGGEST UPWARD TRANSFER OF WEALTH IN HISTORY?

1119

invert yield curve; homewreckers book 8 mil foreclosures; big % llc shell corps; // CDO; R wolff says banks can't deal with hit 1/2 of Gt Recession , get loans to cover loans; mnuchin etc wilbur recalled gov't baillout after S&L; mnu sez put 1.x billion but pain nothing for indybank and then got subsidies to foreclose?! // get car for free, put some bucks in then pocket total profit 11/8/19

new

steve mnu piad 0 for indy bank, and gov't guar lose no money, sold to buddy in same blg (bunch of pluto-crats ) soros, paulsen, wilbur

extensive interview: https://kpfa.org/episode/letters-and-politics-october-23-2019/

https://kpfa.org/episode/upfront-october-21-2019/

aaron glantz homewreckers

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https://www.alternet.org/2019/11/robert-reich-the-real-divide-in-the-united-states-is-not-between-the-left-and-right

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no lnx

Robert Reich: The real divide in the United States is not between the left and right

Written by Robert Reich / Robert Reich's Blog November 4, 2019

https://www.alternet.org/2019/10/house-dems-take-aim-at-trust-fund-babies-with-estate-tax-designed-to-combat-obscene-wealth-inequality/

https://www.alternet.org/2019/10/enough-is-enough-study-reveals-the-mind-boggling-wealth-of-global-millionaires/

...according to Credit Suisse, the U.S. added 675,000 new millionaires over the past year, bringing the country’s total to 18.6 million.

Japan and China both added over 150,000 millionaires, while the U.K., France, Australia, and Italy were among the nations that saw a decline in millionaires.

Overall, the report shows the world’s millionaires now own a combined $158.3 trillion, or 43.9 percent of all global wealth

... new figures detailing vast inequities in wealth distribution globally and within individual nations come as two of the leading contenders for the Democratic presidential nomination in the U.S., Sens. Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.), have released proposals designed to combat wealth inequality through taxation.

Warren’s “Ultra-Millionaire Tax” plan, unveiled in January, would impose a two percent tax on assets over $50 million and a three percent tax on assets over $1 billion.

Last month, Sanders released his “Tax on Extreme Wealth” proposal, which would would create a one percent tax on wealth between $32 and $50 million. The tax would progressively increase for richer Americans—those with over $10 billion in wealth would face an eight percent tax.

...

https://www.alternet.org/2019/10/what-the-democrats-arent-talking-about-fighting-the-new-gilded-age-with-genuine-populism

Fighting the new Gilded Age with genuine populism

Written by Chauncey DeVega / Salon October 20, 2019

America is in a second Gilded Age. The facts are clear.

c de v

Fighting the new Gilded Age with genuine populism

Written by Chauncey DeVega / Salon October 20, 2019

America is in a second Gilded Age. The facts are clear.

The richest 1 percent of American families own approximately 40 percent of the country’s wealth. The richest one-tenth of 1 percent of American families control about as much wealth as the bottom 90 percent. The richest Americans also engage in opportunity hoarding (most acute among the top 20 percent of families) which helps to conserve their power and influence while denying it to others.

This applies to the physical landscape as well. The top 10 percent of American households own approximately 80 percent of the country’s land. [and try to plunder public land]Because unions have been systematically destroyed under neoliberalism wages for the average American have been stagnant for at least four decades.

Kleptocrats use “democracy” to legislate themselves (even more) billions and trillions of dollars by siphoning money upward from America’s middle and working classes as well as the poor. One of many examples: Donald Trump and other Republicans make changes to the tax code and other laws to further enrich themselves. This is legal theft and one of the many ways that America’s second Gilded Age is built upon a rotten foundation of moral hazard.

In perhaps one of the most hideous and odious examples of how the very rich have gamed America’s tax code to their benefit, new research from UC Berkeley economists Emmanuel Saez and Gabriel Zucman shows that America’s billionaires pay less in taxes than the bottom 50 percent of income-earners.

Helped along by Republican “tax reform,” many of America’s richest corporations pay no taxes.

Corporations have almost unlimited power both in the United States and the world to control the life chances of billions of people. America’s public resources and other parts of the commons — which nominally belong to all the country’s citizens — are being sold off to the highest corporate bidder.

Extreme wealth and income inequality has shortened life spans and caused an increase in other negative health outcomes for the American people. In the Rust Belt and other parts of the United States, life spans are actually decreasing at levels not seen since the AIDS crisis of the 1980s. Intergenerational class mobility has stagnated.

Automation, the rise of “artificial intelligence” and other new technologies will only accelerate the wealth and income inequality crisis in America as many different types of jobs — skilled, semi-skilled, and unskilled — are replaced. America’s professional class will see their incomes and economic security imperiled and then diminished.

During last Tuesday night’s Democratic debate, a dozen presidential candidates engaged in a spirited and intelligent discussion about wealth and income inequality in America and potential solutions, including a guaranteed minimum income, changes to the country’s broken health care system, strengthening unions and raising the minimum wage.

Despite their differences on how best to solve America’s wealth and income crisis, as well as other questions of public policy, almost all of the prospective Democratic presidential nominees showed themselves to be better stewards of American democracy than Donald Trump and the Republican Party.

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However, the candidates missed two key opportunities in their discussion of America’s wealth and income crisis. First, they should have connected America’s wealth and income inequality crisis to questions of racial justice and human dignity for all people.

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Second, in making that connection the Democratic candidates could have then explained how racism is a national security threat for all Americans, because the extreme racial wealth and income gap poses a threat to the country’s economy and democracy.

The McKinsey & Company’s new report, “The Economic Impact of Closing the Racial Wealth Gap,” details this threat: The wealth gap between white and black families could potentially cost the United States economy up to $1.5 trillion by 2028:

Other than its obvious negative impact on human development for black individuals and communities, the racial wealth gap also constrains the US economy as a whole. It is estimated that its dampening effect on consumption and investment will cost the US economy between $1 trillion and $1.5 trillion between 2019 and 2028 — 4 to 6 percent of the projected GDP in 2028.

The McKinsey report offers this data about the scale of the black-white wealth gap:

Despite income stagnation outside the circle of high earners, median family wealth grew from $83,000 in 1992 to $97,000 in 2016 (in 2016 dollars).

Beyond the overall growth in top-line numbers, however, the growth in household wealth … has not been inclusive. In wealth, black individuals, families, and communities tend to lag behind their white counterparts. Indeed, the median white family had more than ten times the wealth of the median black family in 2016.

In fact, the racial wealth gap between black and white families grew from about $100,000 in 1992 to $154,000 in 2016, in part because white families gained significantly more wealth (with the median increasing by $54,000), while median wealth for black families did not grow at all in real terms over that period. … Such a gap contributes to intergenerational economic precariousness: almost 70 percent of middle-class black children are likely to fall out of the middle class as adults.

This report is another in a series of findings warning that black Americans may actually have zero or negative net wealth by the year 2053. As the United States becomes a “majority-minority” country, such economic disparities will have an outsized negative impact on all of American society.

How should the Democrats best communicate that America’s racial wealth and income gap is a threat to the country’s economy — as well as democracy and overall stability — in a way likely to mobilize their base while also winning over independents, undecideds and other voters?

The Democrats’ talking points and overall narrative should tell a story that extreme wealth and income inequality is a betrayal of America’s ideal norms of hard work, opportunity and the value of family. Such extremes of wealth and income inequality across the color line are also a betrayal of American patriotism because of what it suggests about the “American dream.”

As new research from sociologists Matthew Feinberg and Robb Willer demonstrates, Democrats can expand support for progressive forward-thinking public policy among moderates, and even some conservatives, by framing their appeals in ways that appeal to “traditional” American values.

Democrats should also take some lessons from UC Berkeley scholar Ian Haney López, author of the new book “Merge Left: Fusing Race and Class, Winning Elections, and Saving America.” As Salon’s Paul Rosenberg recently explored in a two-part interview with López, his research on a winning race-class strategy for the Democrats suggests a solution:

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A message urging joining together across racial groups to demand that government promote racial and economic justice consistently proved more convincing — to whites as well as to people of color — than the Right’s racial fear story. The race-class message also proved stronger than the main progressive alternatives, either staying silent about race to focus on class, or leading with racial justice. Bottom line: the race-class research suggests that merging race and class builds energy and excitement between core constituencies indispensable to a resurgent Left but typically seen as mutually hostile — the white working class and Barack Obama’s coalition of nonwhite voters.

Tuesday’s debate lacked any substantive discussion of racism, racial inequality or the Republican assault on the civil and human rights of nonwhite people. Instead of running away from those fundamental questions of American democracy out of a fear of alienating “working class” white defectors — an avoidance that only demobilizes Democrats by ignoring the concerns of their most enthusiastic voters — the Democrats should fuse questions of class and race together in a compelling story about how the nation is much stronger when all Americans do better economically.

America’s second Gilded Age is a betrayal of Americans on both sides of the color line. That is a winning message in 2020 and beyond.

The question becomes, will the Democrats speak that truth and ride a wave of genuine American populism to victory? Or will the Democrats instead choose a losing strategy of uninspired, tedious neoliberalism-lite that risks giving the Donald Trump’s authoritarian regime a second term, or perhaps an indefinite hold on political power?

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https://www.alternet.org/2019/10/heres-the-dark-side-of-billionaire-philanthropy-and-the-threat-to-american-democracy/

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Here’s the dark side of billionaire philanthropy — and the threat to American democracy

Anthony Quintano https://creativecommons.org/licenses/by/2.0/

Written by Independent Media Institute October 15, 2019

by Tom Conway

Facebook CEO Mark Zuckerberg, America’s fourth-richest person, finally admitted that no one deserves to accumulate as much wealth as he has.

But hey, he says, at least he plans to give a lot of his $69.6 billion net worth to charity.

That’s nice. But it’s not enough considering the threat of concentrated wealth to the American ideal.

America’s very democracy is dying because billionaires like Zuckerberg amass ever more wealth—and thus ever more political power—while everyone else struggles with less—less money, but, just as importantly, less clout in government.

Philanthropy is fine. But to preserve a functioning democracy, everyone, including billionaires, must pay a fair share of taxes so that America has the money it desperately needs to address shared priorities, reinvigorate the middle class and repair the social fabric torn by income inequality. And we need real limits on campaign contributions to stop the nation’s slide from democracy, where many have a voice, to oligarchy, where only the rich are heard.

The rich don’t pay anything like their proportionate share of taxes right now. Not even close.

In fact, a new study shows that the super-rich pay a lower rate than working Americans thanks to the Republicans’ 2017 tax giveaway.

Last year, the nation’s 400 richest families paid an average effective tax rate of 23 percent, compared to the 24.2 percent paid by the bottom half of U.S. households. It turns out hotel queen Leona Helmsley was right all those years ago when she said only the little people pay taxes.

In 1960, the tax rate for America’s 400 richest families was 56 percent. By 1980, it had dropped to 47 percent. As the tax rate for those families fell between 1960 and last year, the middle class shrank, income inequality rose to a 50-year high and the rich consolidated political power through unchecked political contributions.

It’s a vicious cycle. Rich people use their money to hijack the political process and pass laws, such as the 2017 tax windfall for the rich, that give them still more money to push their agenda at the expense of middle-class priorities like stronger Social Security and Medicare.

The few are ruling the many. Make no mistake, American democracy is under attack from within.

During a company town hall meeting, a Facebook employee asked Zuckerberg about the morality of being a billionaire. Zuckerberg said no one “deserves” to accumulate the vast wealth that he has, but he quickly pointed out that he gives much of it away.

Better that rich people donate some of their money than blow it all on waterfront mansions, mega-yachts and sports cars for themselves. And philanthropy can fund important research and social service projects.

But it’s dangerous for a small group of rich people to decide which issues get attention and buckets of cash. This just enhances their status and power.

In a functioning democracy, everyone gets a voice in these kinds of decisions through proper representation and taxation. Taxes are an obligation for the common welfare. Everyone contributes a fair share so that the pool is big enough for the people—through their duly elected representatives—to address shared priorities, from national defense to public schools.

For example, with funds from equitable taxation of all people—rich and not rich—Americans might decide to overhaul their roads, bridges, tunnels, locks and dams. Their condition right now is a national disgrace. A major tax investment in infrastructure would generate family-sustaining jobs—something that would pump up the decimated middle class—and keep commerce flowing.

Some of the additional tax money also could be spent on programs to help Americans struggling to pay for college and health care. Or it might be used to provide food stamps for the poor.

Right now, to save $4.5 billion, the Trump administration wants to kick nearly 8,000 households off of food stamps and reduce benefits to thousands more. Yes, Trump intends to short-change the poorest of the poor after helping the super-rich dodge their tax obligations. But that’s what happens when the rich control the political process.

America’s political system, ideally, is based on a one person, one vote principle. That means each voter possesses the same political clout as every other.

But Americans don’t have an equal voice. And they will never get a just tax policy as long as the rich can buy whatever political policy they want with unchecked campaign contributions and loads of lobbyists. The U.S. Supreme Court gave the rich this gift—the power to spend unlimited amounts on campaign ads and use corporations to inject unlimited dark money into politics. The rich have used piles of money to muffle individuals, even large groups of individuals.

The relationship is transactional. The rich give Republican politicians the money they need to win elections. And then Republicans pass laws benefiting their benefactors and block laws for the 99 percent.

Just look at Senate Majority Leader Mitch McConnell’s opposition to a hike in the minimum wage.

The House this past summer passed a bill to increase the minimum wage to $15 an hour, up from the current poverty-level wage of $7.25 an hour. It would be the first increase since 2009. It’s urgently needed to help counter decades of general wage stagnation for American workers.

Kentucky, McConnell’s home state, had the nation’s sixth-highest poverty rate—16.9 percent—last year, and lots of Kentuckians would benefit from a minimum wage bump. But McConnell won’t bring the bill to the floor. Wealthy employers told him they don’t want it.

Similarly, the power of the 1 percent is the reason that far fewer workers will receive overtime pay than deserve it.The Obama administration proposed extending overtime eligibility to all workers making $47,476 a year or less. The cut-off had been $23,660. But wealthy business groups protested the Obama number, won a court decision that the Republican Trump administration declined to appeal, and now Trump’s Labor Department has reduced the overtime number to $35,568. That means 8 million fewer workers will benefit. Great for wealthy business owners who don’t have to pay. Not so great for those who do the work.

Zuckerberg knows lack of equal representation is a problem. Last year, he gave $200 million in Facebook stock to the Silicon Valley Community Foundation, which asserts: “A healthy democracy is dependent on all community members influencing public policy decisions that affect their lives and neighborhoods.”

Zuckerberg’s charity isn’t going to make that true nationwide, however. Americans must change the system corrupted by big money.

Tom Conway is the international president of the United Steelworkers Union (USW).

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https://www.alternet.org/2019/10/these-7-charts-show-how-legalized-political-corruption-is-so-much-bigger-than-trump

no lnx grafs

These 7 charts show how legalized political corruption is so much bigger than Trump

Written by Common Dreams October 16, 2019

by Kenneth R. Peres

Corruption. It’s a word we hear a lot these days.

The press primarily focuses on the type of corruption characterized by individual government officials who use their political power to reward themselves and/or their allies. Recent examples/allegations include President Donald Trump’s attempt to strong arm the president of Ukraine to benefit Trump’s reelection campaign; the many instances of official U.S. business being steered to Trump properties; and the misuse of government funds by Trump appointees including the current secretaries of commerce, education, and HUD; the former secretaries of the interior and health and human services; and the former administrator of the EPA. A number of organizations have been tracking the growing list of conflicts of interest under the Trump administration, one of which keeps a running tally of articles and another that has cited more than 2,000 specific instances. Of course, these types of corruption are serious but not unique to this administration—it just seems that there is a lot more of it and/or it is being exposed more often.

However, there is another type of corruption that receives much less attention even though it is significantly more vast and insidious than individual instances of self-enrichment and conflicts of interest. This type of corruption is institutional: a system in which corporate and wealthy donors can legally “buy” politicians and their favored policies. We are told that our democracy is based on the principle of one person–one vote as exercised in popular elections. However, in practice, the fulcrum of our political process is based on the reality of one dollar–one vote as exercised in campaign contributions, lobbying the legislative and the executive branches of government, and influencing the appointment of justices.

The one dollar–one vote principle is implemented in four simple steps. First, corporations and wealthy donors legally invest billions of dollars in campaign contributions for their favored candidates. Second, the corporations and donors spend many billions of dollars more on lobbying the same politicians in Congress and the executive branch. Third, the politicians then pass the policies and approve the judicial and executive nominees favored by the corporations and wealthy donors—and also prevent the passage of popular policies that are not supported by the donors. Fourth, these policies lead to the transfer of trillions of dollars in wealth and income from working- and middle-class families to these corporations and wealthy individuals. The entire process is institutionalized in laws passed by Congress, implemented by the executive, and upheld by the courts—all geared to favor big business. The separation of governmental powers into three branches has become a fiction nullified by a veritable corporate coup d’état.

The following analysis will use a series of charts to illustrate and quantify how this corrupt political system is rigged for the rich and powerful and against the mass of working- and middle-income families.*

Popular Policies Languish While Unpopular Special Interest Policies Become Law

Many popular policies are not passed—and often not even brought to a vote in Congress—while many unpopular policies are passed. For example, according to a number of polls, the 2017 tax cut that overwhelmingly benefited big corporations and the wealthy was passed and signed into law though it was opposed by 55 percent of those surveyed. Conversely, increasing taxes on those earning more than $1 million is supported by 62 percent but does not even get a vote in Congress. Similarly, the Wall Street bailout of 2008 passed Congress even though it was opposed by more than 60 percent of those surveyed.

How is it possible that such wildly popular programs are rarely passed while unpopular programs become law? A study by Princeton University’s Martin Gilens and Benjamin I. Pagthat examined 20 years worth of data (1981-2002) provides an answer. “The central point that emerges from our research,” wrote Gilens and Pagthat, “is that economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while mass-based interest groups and average citizens have little or no independent influence.” The following charts will illustrate why “economic elites”—i.e., big business and wealthy donors—have “substantial” impacts on our political process and you don’t.

Big Business Invested $69.8 Billion to Capture the Political System

The easiest way to illustrate the overwhelming power of big corporations and the wealthy in our political economy is to compare the campaign and lobbying expenditures by big business to the expenditures by labor and environmental groups. Labor and environment represent the largest and most organized groups that attempt to counter the power of corporations and the wealthy in our society.** Big business spent $69.8 billion on campaign contributions and lobbying expenses from the 1990–2020 campaign cycles compared with $3.1 billion combined for labor and environment. Thus, big business spent $22.31 for every $1 spent by labor and environmental groups on campaign and lobbying expenditures. Specifically in relation to campaign contributions, big business invested $17.84 billion compared with $1.52 billion by labor and $362 million by environmental groups from 1990–2019. In terms of lobbying, big business invested $51.93 billion compared with $935 million by labor and $306 million by environmental groups from 1998–2019.

It is true that labor and a number of environmental groups rely more on the grassroots efforts of their membership than they rely on money. However, it is obvious that the money power of big business has overwhelmed the grassroots efforts of labor and environmental groups given the failure of Congress to pass any significant pro-labor and pro-environmental laws over a number of decades while passing many laws supported by big business.

There is also an extreme imbalance in relation to the number of lobbyists employed by big business in comparison with labor and environmental groups. There were 22 business lobbyists for each combined labor and environmental lobbyist in 2019. Business lobbyists often help a member of Congress raise campaign money from wealthy donors; write bills; and offer or intimate a future well paying job. Sixty percent of the business lobbyists have revolved between the public and private sectors—specifically using their experience in government to obtain lucrative lobbying positions to support the policies of their corporate employers.

The distribution of campaign expenditures by big business is also unbalanced. Big business directed $8.64 billion or 58 percent of its campaign contributions from 1990-2019 to Republicans. Conversely, labor and environmental groups gave more than 90 percent of their $1.01 billion campaign contributions to Democrats. Obviously, these figures help explain why Republican candidates are fully supportive of the interests of big business. However, big business also has considerable influence within the Democratic Party. Indeed, big business invested significantly more in campaign contributions to Democrats than labor and environmental groups combined. Big business gave Democrats $6.37 billion in campaign contributions while labor gave just $952 million and environmental groups gave just $55 million from 1990-2019. Big business gave Democratic candidates $6.32 for every $1 provided by labor and environmental groups. It should not be surprising that many Democrats are beholden to big business.

Return on Investment: Business Friendly Courts

It is very important to understand that for big business, campaign and lobbying expenditures are investments. Big business expects—and receives—a very good return on these investments. One important return is stacking the court system with pro-business justices who will likely uphold the big business policies passed by Congress and signed by the president. Since big business is closely tied to the Republican Party and has a number of corporate Democratic friends, it plays a critical roll in the choice and appointment of federal court judges. For example, the current Supreme Court is famously divided along party and ideological lines with five justices nominated by Republican and four by Democratic presidents. Many cases are decided along ideological lines—however, this is not the norm for cases involving big business interests. Tellingly, the Chamber of Commerce endorsed eight of the nine current justices. Thus, it should not come as a surprise that Supreme Court justices often put aside their ideological differences to unite in favor of big business interests. For example, the U.S. Chamber of Commerce (the largest big business lobby) filed 14 briefs during the 2017 term and won 11 while losing three. During the 2018 term, the Chamber filed 10 briefs and won nine of them—six of the nine Chamber wins were decided by margins of 9-0 and 7-2. The following chart illustrates how the Supreme Court has increasingly tilted in favor of big business.

One of the biggest wins by big business over the last decade was the Citizens United v. Federal Election Commission case decided in 2010 by an ideologically divided court. In this case the Supreme Court majority not only re-enforced the counterintuitive theory that corporations are people but also further institutionalized the contention that corporations have many of the same rights as actual human citizens. For example, in Citizens United, the Supreme Court majority reinforced and strengthened previous decisions (based on the 1976 Buckley v. Valeo decision) contending that spending money on political campaigns is a form of free speech protected by the First Amendment. The Citizens United decision specifically prohibited the government from restricting independent expenditures for political communications by corporations, nonprofit corporations, labor unions, and other associations. Basically, the Supreme Court ruled that money spent on politics is an expression of free speech and cannot be limited by Congress. Since big business and the wealthy spend much more money on politics, they have much more free speech than the rest of us.

Return on Investment: Massive Transfer of Income and Wealth

The big business investment of $69.6 billion in the political process from 1990-2019 has been very lucrative. Big business has pushed Congress to pass and the courts to uphold what I call the Corporate Agenda—a set of policies that includes tax cuts, selective deregulation/regulation, privatization of government services, cuts to social programs, and limitations on civil and workers rights. I have outlined the central place that this Corporate Agenda plays in the economic policies of the current (and former administrations) in a previous series of articles. The Corporate Agenda policies enacted over the past 40 years have helped to create vast increases in the share and overall level of wealth and income concentrated in the wealthiest income groups. For example, the tax cuts instituted by Presidents Bush and Trump have resulted in a nearly $2 trillion gain flowing to the top 5 percent of taxpayers including more than $1 trillion to the top 1 percent.

These power dynamics are illustrated in the following chart that compares the share of union workers with the share of income concentrated in the top 1 percent over a more than 100-year period. The conclusion: the share of income obtained by the 1 percent was reduced when union representation increased and significantly increased as union representation was reduced. The share of income obtained by the richest 1 percent has now reached levels not seen since the heyday of the roaring ’20s.

Specific policies that aided these trends include the 2001 and 2017 tax cuts favoring corporations and the wealthy, a 1993 law creating more incentives for corporations to grant stock options to corporate executives, the deregulation of Wall Street starting under President Ronald Reagan but reaching a peak under President Bill Clinton, and the deregulation of many other sectors starting with President Jimmy Carter. Of special note are policies that have specifically weakened organized labor including trade deals that eliminated millions of union represented manufacturing jobs by providing incentives to corporations to move offshore, unfavorable rulings by the Supreme Court and the National Labor Relations Board, the lack of enforcement of workers’ rights, and allowing corporations almost free reign to run anti-union campaigns. All of these policies tamped down increases in wages and benefits for workers while adding more profits to corporations, more income and wealth to the “elite,” and a stock market boom aided by expectations of even more profits.

The economic elite have also benefited from a massive increase in their share of the nation’s net worth. Net worth is the difference between what is owned (assets) and what is owed (liabilities). From 1990–2018, the top 1 percent experienced a $20.8 trillion increase in their net worth as adjusted for inflation. The bottom 50 percent actually experienced an $852 billion decrease in their net worth.

According to the Federal Reserve, the top 10 percent now own 71.6 percent of all financial assets including 86.5 percent of corporate equity and mutual funds, 80.9 percent of corporate and foreign bonds, and 80.2 percent of U.S. government and municipal securities. Meanwhile, the bottom 90 percent own 76.6 percent of all liabilities including 73 percent of home mortgages and 89.7 percent of consumer debt. While the rich get more wealth and income, the middle gets more debt.

What to Do

The unequal distribution of wealth and income also reflects the distribution of power in our society—the hegemony of a corporate and wealthy elite has become so obvious that even former President Carter stated that the U.S. is run by “an oligarchy with unlimited political bribery.” This entire dynamic explains the issue posed at the beginning of this article: Why do popular policies that serve the “general welfare” languish while unpopular policies that serve special interests flourish? The answer, as we have seen, is to follow the money.

The primary way to fix corruption as a systemic problem is toform amass movementto replace corporate politicians with activists who are committed to openly and directly challenging the current power structure and instituting a truly effective democratic political process.

A corporate and wealthy elite has invested billions of dollars to create a corrupt political system that not only rigs the rules in their favor but also institutionalizes their hegemony at every step of the political process. In return for this investment, they have captured Congress, the presidency, and the judiciary. This entire process is not inevitable: it is the result of specific power relations and policy decisions—and therefore can be addressed and fixed.

There are many current proposals for reforming this system including those offered by Sen. Elizabeth Warren (D-Mass.); House Democrats who passed HR 1 earlier this year; the Roosevelt Institute; the Brennan Center; the American Anti-Corruption Act; as well as various proposals to overturn the Citizens United decision.

The conundrum is that proposed reforms to fix this institutionalized problem of legalized corruption have to be passed by elected officials and supported by court judges who benefit from and are products of this same tainted system. It is doubtful that these politicians can be trusted to pass a set of reforms that would effectively limit the power of corporations and the wealthy while expanding the power of working families. Consequently, the primary way to fix corruption as a systemic problem is to form a mass movement to replace corporate politicians with activists who are committed to openly and directly challenging the current power structure and instituting a truly effective democratic political process.

Unless this is done, each major policy issue such as climate change, the threat of nuclear war, health care, education, civil and voting rights, workers rights and much more will be circumscribed or defeated by the money power of corporations.Building such a movement will not be an easy task but our history is replete with such movements that have successfully challenged the power structure: the American revolutionaries, the Abolitionist, Suffragette, Progressive, Union, Civil Rights, Environment, Consumer, and LGBTQ movements. It is now time for a small “d” democracy movement that directly attacks systemic corruption by depending not on specific leaders but on a grassroots movement that both produces leaders and holds them accountable. It is up to us, not them.

*Please note that all data concerning campaign contributions, lobbying expenses, and the number of lobbyists were calculated using information collected by the Center for Responsive Politics as provided on their OpenSecrets.org website. Campaign expenses have been collected for the campaign cycles beginning in 1990 to the current unfinished cycle of 2020. Lobbying expenses have been collected from 1998 to 2019.

**In aggregating data from the OpenSecrets.org database to determine expenditures by Big Business, I used the totals for the following sectors: Financial-Insurance-Real Estate; Health; Energy & Natural Resources; Miscellaneous Business; Transportation; Communications & Electronics; Agribusiness; Construction; and Business Associations. For Labor, I aggregated data for Unions and the AFL-CIO.

Kenneth R. Peres retired as chief economist of the Communications Workers of America. Formerly, he served as economist for the Northern Cheyenne Tribe, the Montana House Select Committee on Economic Development, and the Montana Alliance for Progressive Policy. Ken has held teaching positions at the University of Montana, St. John’s University, Chief Dull Knife College, and the City University of New York. He obtained a PhD in economics from the New School in New York City.

https://www.ecowatch.com/disaster-aid-federal-buyouts-2640914729.html

aha-let inequality leads to polarization and instability

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https://www.alternet.org/2019/09/autocrats-do-not-need-a-majority-to-destroy-democracy-a-divided-opposition-helps-them/

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Autocrats do not need a majority to destroy democracy. A divided opposition helps them

Written by Claudia Koonz / History News Network September 16, 2019...

https://www.alternet.org/2019/09/how-american-inequality-follows-us-to-the-grave/

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How American inequality follows us to the grave

Written by Independent Media Institute September 13, 2019

by Tom Conway

Regular exercise and an apple a day may help to keep the doctor away. But to live a long, healthy life, it helps to be rich.

Income inequality is a pox on America. The rich keep getting richer and the poor keep getting poorer. CEO pay keeps rising while workers’ paychecks have been all but flat for decades. As a result, income inequality now rivals that of the robber baron days of the early 1900s, when labor unions were virtually outlawed while corporate monopolies thrived.

It gets worse. It turns out that low income is an actual pox, killing people before their time. The nonpartisan Government Accountability Office found in a study released on September 9 that poor people live shorter lives than rich people.

This is appalling. And preventable.

Researchers at the GAO discovered that poor people are doomed to an early death. They tracked a group of people who were in their 50s in 1992—and found that that the wealthier members of the group were much more likely than the poorer ones to be alive in 2014.

Money may not be able to buy happiness, but it can buy longevity.

The early death effect of poverty plays out in whole neighborhoods and towns. Take the coal community of McDowell County, West Virginia, where the poverty rate is nearly 32 percent. As of 2016, a man’s life expectancy there was 63.9 years, the lowest among U.S. counties.

By organizing themselves into unions, workers can buy themselves more time on earth. That’s because median weekly earnings of union workers are about 22 percent higher than those of nonunion workers—$1,051 compared to $860, according to the U.S. Bureau of Labor Statistics.

Organized labor also fights to get workers better health insurance and retirement benefits. Unions work to make workplaces safer and to hold companies responsible for unsafe conditions so workers don’t die on the job.

Unions lift people out of poverty and narrow income inequality. They help to close racial- and gender-based pay gaps. People with decent incomes and benefits are better able to access health care, afford healthy food and enjoy comfortable retirements.

The opposite also is true. The lower rate of unionism in recent years has allowed income inequality to grow, and that has led, as the GAO study shows, to disparities in life expectancy. Even the Grim Reaper favors the rich.

Because unions help build the middle class, government used to support them, especially under President Franklin Delano Roosevelt in the 1930s and 40s. But not now.

Now, organized labor is under attack. President Trump’s National Labor Relations Board has made a series of anti-worker decisions that includes denying unions access to an employer’s public spaces, such as hospital cafeterias; denying SuperShuttle drivers the right to organize; and allowing employers to withdraw recognition of unions before negotiations for a new contract begin.

GOP-controlled legislatures in states ranging from Wisconsin to West Virginia have passed so-called right-to-work laws that allow workers to benefit from union contracts without joining the union and paying dues and without even paying smaller fees charged to non-members to cover the cost of union services such as negotiations and grievance cases.

And last year, the U.S. Supreme Court, packed with Republican appointees, issued the Janus decision that made the entire country right-to-work for public-sector workers. In all 50 states now, public-sector workers who don’t join unions can pay nothing but still enjoy the higher wages and other benefits that dues-paying members get.

As right-wingers legislated away union rights over the past four decades, the power of unions declined, and the middle class became stuck. U.S. Census Bureau data released on September 10 show that middle-class wages are roughly the same now as 20 years ago.

That’s two decades of stagnation. For workers, not CEOs. Since 1978, CEO pay packages have risen nearly 940 percent.

Eight executives at Philadelphia Energy Solutions illustrate how the rich look out for themselves while stiffing everyone else. Together, those executives received almost $4.6 million in retention bonuses on the heels of the June 21 explosion and fire that shut down the refinery, pushed the company into bankruptcy and put about 1,000 employees—many of them members of United Steelworkers Local 10-1—on the street without pay or health insurance.

The employees were the ones who risked their lives the day of the disaster by taking quick action to prevent the release of lethal hydrofluoric acid, saving untold lives inside the plant and across Philadelphia.

The executives who operated the plant—and were ultimately responsible for the fire and explosion—got a big payoff. The workers got pink slips.

This kind of rapacity is so pervasive that it might actually be hurting the economy. Money is being concentrated in the hands of super-rich people who are more likely to invest it than spend it, and that can affect growth.

At the other end of the spectrum are people like those in the GAO study who died younger than they deserved.

Many of them relied on Social Security to scrape by in retirement. The poorest people in the group didn’t own homes or even cars. They had only what social insurance programs provided.

Like labor unions, these programs are under attack.

The Trump administration has so weakened Obamacare that the portion of Americans without health insurance increased last year.

And after Congress gave rich people and corporations that huge tax cut in 2017, Republican leaders talked about cutting Social Security and Medicare to pay for it. They didn’t do it yet, but the fight isn’t over.

Sen. Joni Ernst, a Republican from Iowa, recently suggested that Congress meet behind closed doors to discuss “changes” in Social Security. She said she feared public backlash from having the conversation in public. More specifically, she said she didn’t want to look like she was pushing “granny over a cliff.”

Sen. Ernst’s flippancy speaks volumes. It shows how little she and other Republicans think of the grannies and grandpas, dads and moms, and working men and women who have broken their backs to pay taxes and provide for their families.

Some will struggle all of their working lives, still be unable to save anything for retirement and die early deaths. Sen. Ernst needs to wake up. The Republicans’ pro-wealth, anti-labor and anti-social welfare campaigns are pushing people over a cliff before they live long enough to become grannies.

Tom Conway is the international president of the United Steelworkers Union (USW).

This article was produced by the Independent Media Institute.

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an 1019

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Ralph Nader: Here are 19 ways the 1 percent rules — and the 99 percent lets them

Written by Ralph Nader / Common Dreams October 6, 2019

There has never been more access to food—domestic and imported—yet hunger is an ongoing problem everywhere. In the U.S. alone, 16.5 million children go to bed hungry and 20% of community college students are experiencing “food insecurity.”

Never have there been more communications technologies, yet it is harder to get through to people personally than fifty years ago.

Never have people been able to use their right to free speech so unencumbered, yet a torrent of lies are now spread so freely and are often unchallenged.

Never have there been higher corporate profits, yet staggering amounts of poverty and near poverty remain along with stagnant wages.

Never have there been more medicines to alleviate pain, yet far too many of these pain killers have caused massive fatalities and addictions.

Never has there been more liquid corporate capital piled up, yet corporate investment is proportionately lower than before. Instead, CEO’s have burned over 7 trillion dollars in unproductive stock buybacks in the past decade.

Never have there been more exercise outlets, exercise machines and apps, yet obesity is still rampant.

Never have there been more tax breaks for big businesses, yet big businesses use so little of the windfalls for productive investments, good jobs and shoring up pensions.

Never has there been more free access to information, yet so little retained knowledge.

Never have there been more impressive muckraking film documentaries and books that expose corporate and government crimes, yet this media attention produces less impact and reform.

Never have there been more ongoing impeachable offenses and statutory violations by a president, yet the opposing Party in Congress have been reluctant to move on the many articles of impeachment. Remember how fast the unified House of Republicans moved to impeach Bill Clinton in 1998 for perjury and obstruction of justice?

Never have there been more trainers, sports physicians, protective equipment and guards for professional athletes, yet there are far more injuries and days lost by players than was the case sixty years ago. Now there are helmets, gloves, pads, cushioned walls, better shoes etc. Why?

Never has there been more to read, yet there are so few readers reading. Historically, we have gone from illiteracy to literacy to aliteracy!

Never before has technology made it so easy for heads of government to meet, yet fewer international treaties are made. (Eg. Cyber, water, environment, consumer, labor etc.)

Never has there been such an outrageous corporate crime wave, yet law enforcement budgets have decreased! The more big CEO’s are paid, the worse is their management. (Eg. The big banks twelve years ago, General Electric for years.)

Never before have there been so many wrongful injuries, yet the court budgets are becoming tighter and the law of torts is being restricted. Without the defense of and use of our civil justice system, wrongful injury cases cannot go to court with a trial by jury.

Never before has there been more corporate fraud, yet agencies tasked with bringing this fraud to justice have smaller budgets and more limitations.The budget of the Federal Trade Commission (FTC) is a third of one day’s worth of health care billing fraud, which is estimated this year to be $350 billion, according to Harvard’s national expert on the subject, Professor Malcolm Sparrow. The Consumer Financial Protection Bureau (CFPB) has been straitjacketed by the evil corporate crime abettor Mick Mulvaney, the acting White House Chief of Staff for corrupt Donald.

Never has the drug industry accumulated more profits and government subsidies, yet so many patients cannot begin to afford lifesaving medicines.

Never have the under-taxed super-rich been so rich, yet on average give a smaller proportion of their money to “good works.” Actually, middle and lower income people give more proportionally than do the ultra-wealthy.

I could go on and on. Pick up the pace, readers. Senator Elizabeth Warren has correctly called for “big structural changes.”

https://www.alternet.org/2019/09/billionaires-prepping-for-an-apocalyptic-event-but-what-happens-to-everyone-else

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Billionaires prepping for an apocalyptic ‘event’ — but what happens to everyone else?

Written by Chauncey DeVega / Salon September 3, 2019

The Earth is in the midst of an environmental disaster. Humankind may not survive the Anthropocene.

Climatologists and other scientists are warning that if the Earth’s temperature rises more than 2 degrees Celsius that the human race may have reached a point of no return in terms of stopping global warming and the catastrophes it will cause.

Global warming is causing rising sea levels which threaten at least one billion people. Global warming is also generating a weather feedback loop which is causing hurricanes, blizzards, firestorms, and droughts to become more extreme. There is also a shortage of arable land and fresh water. Entire ecosystems are collapsing all over the planet.

The world’s militaries are preparing to fight “resource wars.” These conflicts will likely kill many thousands (if not millions of people). Resource wars will also create a global refugee crisis as entire populations are displaced. As global warming melts glaciers in Antarctica, Siberia, Greenland and elsewhere there will also be a mad scramble by the United States, Russia, China, and other nations to secure rare earth metals and other resources.

As the Earth’s climate and weather continues to worsen who will live and who will die?

The answer: the rich will find a way to survive while everyone else will experience gradations of misery and death depending on their socioeconomic status.

This is the logical and predictable result of extreme inequality where 1 percent own half the planet’s wealth. This inequality is also a function of neocolonialism where the West continues to enrich itself by siphoning a huge amount of resources and other wealth away from the Global South and the “Third World” every year. Rich countries also benefit disproportionately from destroying the world’s environment.

Neoliberal policymakers and other elites in the West and elsewhere have developed a language and ideology to justify doing everything and anything possible to survive environmental collapse and the global chaos it will cause.

Such a system of extreme self-interest is encouraged by how, at its core, neoliberalism is an example of Social Darwinism and Malthusian thinking: survival of the fittest is the guiding principle. All other people are expendable and viewed as being “surplus” under this form of human livestock management. The rich and powerful justify and naturalize such an outcome through a disproved theory known as “lifeboat ethics”.

How is “apocalyptic greed” fueling environmental disaster? What will human society look like in the aftermath of a global environmental disaster? How can we create a more humane and just society to both prevent such a dystopic outcome and/or to survive once it occurs? In what ways are human history and memory being turned into a commodity owned and controlled by the few as society becomes more digital and less analog? How are plutocrats and elites across the political spectrum working from the same playbook as they prepare for “the Event”.

In an effort answer these questions I recently spoke with Rob Sheridan. He is a futurist and former graphic designer for the band Nine Inch Nails. He is also the writer of the new science fiction graphic novel series “High Level” from DC Comics.

This conversation has been edited for clarity and length.

You are now writing a comic book. You were the web designer and artist for the bands Nine Inch Nails and How to Destroy Angels. Does the novelty and surprise of what you do for a living ever go away?

In the past I’ve worked mostly with other artists. “High Level” is my first foray into doing something that is entirely my own creatively. That has been a big career change for me. There are moments when I say to myself, “Oh my God, this is just me now.”

It is exhilarating and terrifying. There is the excitement of being able to guide a project in my own way. But there is also the terror of “now it is up to me”. You make something, you put it out into the world and you hope people like it.

Right now I’m riding on the high of feeling a sense of relief that readers have been responding so positively to the graphic novel series. I think it is really important for a creator to acknowledge that almost every artist and other creative people as well feels a certain sense of impostor syndrome. But in the end it is really satisfying to know that readers are enjoying the book.

How did you overcome the anxiety and decide to follow through on being an artist, a writer, and doing that creative work as your profession?

I don’t think I ever got over it. And I don’t think the vast majority of creative people ever truly get over that feeling. When I got asked by Nine Inch Nails if they wanted to work with me when I was a 19-year-old kid who’d only just done websites on my own in high school, there was this feeling of, “What are you talking about? I can’t do this.” But when you’re asked to take on a project, a big challenge, you can either step up and say, “Well, they asked me so there must be some value in what I’m doing and I should pursue it” or you can shrink away. I had similar feelings when DC Vertigo came to me and they said, “We like your work that you’ve done in the past. Do you have a pitch idea for a comic?”

When you are in that impostor syndrome headspace, you think immediately, I’m not a comic book writer, or I’m not this, or I’m not that, your immediate instinct is to say, “No, no, no, no, no.” But you have to overcome that voice. You have to step up to the challenge — or not. It’s very rewarding to find out that stepping up and conquering that impostor syndrome voice often works. And I think every creative person should remember that all of their heroes, all of the biggest artists, all the biggest musicians, no matter what they’ve achieved feel that way in one way or another.

What is the creative DNA of “High Level”? There is clearly some “A Boy and His Dog” in the story.

The first story arc is very much “A Boy and His Dog.” But it’s not the ultimate destination. But it is important to begin “High Level” that way for a number of what are mostly character-driven reasons. I love classic adventures where people are forced into a task they didn’t want to take on and then have to go from their small place in the world out into a much bigger and much more dangerous environment that they never wanted anything to do with. “Lone Wolf and Cub” is another example of the type of storytelling that inspires my work.

It is also my first comic book as a writer. I want to tell the type of story that I want to read. I want to tell the type of story that has inspired me since I was a kid. I’m not afraid to wear my influences on my sleeves. “High Level” is heading to a place that few readers are going to expect. I just want them to come along for the journey.

What are some of the other influences?

I’m a huge fan of 1980s retro futurism. And by that I mean specifically the way that science fiction in the 1980s and the 1970s shows how the future would be. I am specifically very interested in the predictions of the future made at the time which have now been shown to be incorrect.

For example a film such as “Blade Runner” has flying cars. But there are these tiny little boxy old televisions in the “Blade Runner” movies and that world still does not have the internet. They are still using pay phones, disks and analog hardwired technology. “Total Recall” is another film that I love which envisioned the future from an analogy perspective. The story I wanted to tell and the commentary I wanted to offer begins where we are right now in 2019.

Where are we heading as a global society? There is climate change that is going to completely disrupt society if we don’t do anything about it. Climate change impacts the power grid, infrastructure, and just about every aspect of human society. In this future I am imagining in “High Level” digital devices that rely on the cloud or other types of network connectivity are gone. They don’t exist anymore.

If human society is thrust into several generations where survival is all that matters then our technological comforts will fall by the wayside. This means that the beginning of “High Level” shows a society that is scavenger based. They’re rebuilding their own technology from old things they find from the past. This allows me to introduce a very tactile analog element to the world of “High Level.”

Because of digital technology we are going to know a lot more about the far past — paper and books will survive — than we will about the recent past. If there is a global disaster much of the digital information will be gone — or at the very least the means of accessing it will be.

That is exactly what “High Level” is grappling with. In the first issue the opening monologue is about the main character discovering a book that we, the readers, know is the Bible. But in the world of “High Level” they do not have any cultural context for what the Bible is or means. So to that character, it is just a book of gibberish.

How far are we really from that future right now? “High Level” is also about the erasure of history. All they have left are books. What if 50 years into our future there is a moment when our infrastructure and all of our digital technologies are disrupted in one way or another. As we increasingly put all of our media, all of our history, all of our thoughts, all of our memories onto the internet — we call it the cloud, but it doesn’t exist in the air. It exists on physical servers on the ground, and if the servers are destroyed we lose all of our history. Books will survive. And then maybe the only real true recorded history of what brought the world to that moment exists only for the people who had the money to preserve it. That is where “High Level’s” story is going.

Imagine how much control the very rich, the elites have over knowledge and information. If they wanted to delete all of our collective memories and history there are only so many people who really have the keys to all of that digital technology right now. And of course they are the very rich and powerful. When it comes down to who survives as Earth’s environment collapses, what are these plutocrats and other very rich and very powerful people going do? Are they going help us all or are they going to help themselves? That dichotomy about how the 1% survives versus how the 99% survives is really the core of the idea behind “High Level.”

The average person is just trying to survive under a regime of cruelty as well as distraction that is neoliberalism. Most people are not thinking about the future in a big picture way. Their lives are very much about the immediate present and getting dopamine hits to their brains from social media, smart phones, and other technology to combat their deep feelings of loneliness and social atomization. By contrast, the 1 percent and the other global plutocrats and oligarchs are planning for the future and what they see to be an inevitable calamity.

The differences between the “alt-right” conspiracy theorist types online and billionaires who are viewed as being liberal in some way or another are really not that great.

They both have a mutual priority which is survival. They want to preserve their way of life. The “alt-right” ideologically driven racial “ethno state” vision is not really that different than that of the private billionaire. They are going to keep all of their stuff and everyone else can go off and die. This is true even of those billionaires who are self-proclaimed philanthropists and who say that they’re liberal. At the end of the day when push comes to shove they are all going to preserve their way of life above anything else.

The secret billionaires— the ones who have huge sums of wealth and who keep a low profile — are now asking futurists, “What’s the best way for us to survive the Event?” They do not exactly know what the Event specifically is, as it could be global ecological disaster, mass migration, a class uprising, but the billionaires are planning for it. They feel like it’s coming. And they know that the cross-hairs are on them.

These questions include, “How do we build a super bunker? How do we hire militias to protect us and make sure that they won’t turn on us? Do we trust AI?”

If things do not change core questions of survival are going to dominate the future of humanity. That future will be very different for those who are allowed to hoard the wealth as opposed to the rest of humankind. The world is facing an apocalypse of greed, the intersection of income inequality and climate change.

What happens when there is no more arable land and readily accessible fresh water? What happens when the middle class, the lower working class and the poor can no longer access cheap consumer goods? The replacement of huge swaths of the American and European (and global) middle and professional classes with robots and AI? When global warming floods the world? These are the questions that we as a species will be forced to grapple with sooner rather than later.

Right now there is an American populace which has been convinced that they’re being betrayed somehow by immigrants or by having to pay taxes to maintain a minimum social safety net for “those people.” At the same time, these very same people are the ones who want to run out to Walmart every weekend and catch the cheapest deals on giant TVs.

So many Americans do not understand that the reason they can have all this cheap stuff is because it’s made on the backs of laborers from other countries. And if they got those precious American jobs that they want back, then those TVs at Walmart would cost three times as much — at least. Too many people in America have been conditioned to not think logically about these issues. When these huge system shocks hit it is going to be really ugly unless we can somehow turn the tide of American culture at present.

There is the Event, the global disaster. But then there is what happens after, that moment which some futurists, science fiction writers, social scientists and others have described as the “post-post-apocalypse”? How do we reestablish normalcy? What does that look like in your graphic novel series “High Level”?

For me, it is not so much about establishing normalcy as it is revolution.

“High Level” is a science fiction fantasy. But I want to draw a really strong parallel to where we as a country and species are right now. We need to take a critical look at certain aspects of our society that are working as well as the other ones which are tearing us down. There are so many people who have bought into an incorrect narrative about their own personal progress, the meaning of their lives, and ultimately what a “high level” is for them.

In “High Level” I wanted to show a world where there are people developing a community after the post-post-apocalypse. They are making things work. They are trying to solve problems and live in a communal way. They work with each other. The people in this new world are guided by communal values. The ultimate revolution is realizing that the real power is in us and it is not elsewhere in the hands of elites or some other higher system of control.

American Airlines booted allergic black man from plane so dog could fly first class: lawsuit

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Elizabeth Warren has a plan to reform "Heirs' Property," which allows wealthy white property developers to steal Black family homes

Heirs' property is a relic of post-Reconstruction law, which allows white developers to exploit the diffuse ownership of Black family homes to steal them and kick out the people who live there. Read the rest

aha, a driver: see pseudo-pop // authoritarian, ~ inequality (recall occupy and TP opposite reaction to same crisis/ inequality)

‘This is obscene’: New study shows CEO pay has grown more than 1,000% since 1978

Julia Conley / Common Dreams

===

no lnx

Trump’s big farmer grift: He’s giving millions to the rich while starving the poor

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https://www.alternet.org/2019/08/trumps-big-farmer-grift-hes-giving-millions-to-the-rich-while-starving-the-poor

Written by Jim Hightower / Creators Syndicate August 15, 2019

Donald Trump loooooves farmers. We know this because he says so. “Farmers, I LOVE YOU!” he declared in December. And we’ve learned that whenever The Donald says something, it’s true — even when it’s not.

These days, he’s loving farmers to death. Trump has ignored the obvious need to get monopolistic price-fixing bankers, suppliers and commodity buyers off their backs. And he’s ineptly playing tariff games with China and other buyers of U.S. farm products, causing exports and farm prices to tumble. The result is that our ag economy is tumbling into a deep ditch, slamming farm families and rural America with a rising tsunami of bankruptcies.

Adding crude insult to economic injury, Trump’s doofus of an ag secretary, Sonny Perdue, laughed at farmers, branding them “whiners” for opposing his majesty’s disastrous policies.

So, needing a political “I love you” gesture, Trump has been sending big bouquets of money to some of his beloved farmers. Our money. Lots of it — $28 billion so far, in what he cynically (and comically) calls the Market Facilitation Program, otherwise known as a taxpayer bailout.

But TrumpLove turns out to be highly selective, with more than half of the government payments going to the biggest farm owners. The Department of Agriculture initially announced a $125,000 limit on the amount any one farm could get, but every Trump deal seems to have a gimmick in it to give a special break to the slickest operators. The slickum in this deal is that assorted members of a family can claim to be owners of the same farm and be eligible for bailout money, even if they do no actual farming and live in New York City! Thus, one Missouri farm family got $2.8 million worth of subsidy love from Trump, and more than 80 families topped half a million in payments.

Meanwhile, the great majority of farmers — 80% of eligible grain farmers — got zilch from Donald the Dealmaker. The smaller producers who are most endangered by his export collapse got less than $5,000. So Trump’s “Market Facilitation” is squeezing the many who are most in need while helping a few of the largest get even bigger.

While the Trumpistas are presently trying to plow a multibillion-dollar subsidy into big grain farms, they’re shockingly stingy when it comes to our society’s moral responsibility to make sure the least-wealthy among us get an adequate level of food. Their latest effort in the practice of mass minginess is to try literally taking food off poor children’s plates. Using a tangle of federal red tape, Trump ideologues and bureaucratic minions are intervening to prevent states from providing food stamp assistance to millions of their people.

According to federal rules, to qualify for food aid, a family of three should have an income under $27,000 a year. But with rents, utilities, health care and even food prices constantly rising, millions of Americans can’t make ends meet on such a low income. Thus, 40 states have stepped in to loosen that income restriction so families at least get the minimum nutrition humans need. Far from being welfare moochers (as far-right-wing extremists screech), these recipients overwhelmingly are working families, children, the elderly and Americans with disabilities. The benefit is hardly lavish; it averages only $127 a month, but even this modest outlay has proven enormously successful in mitigating poverty.

Congress actually authorized states to make such pragmatic income adjustments in a 1996 revamp of the law. But look out! Here comes Sonny Perdue again, rising up on his hind legs to proclaim that naughty state officials are using that authority as a “loophole” to circumvent Trump’s federal authority. So Sonny and Donnie are demanding that a whole new bureaucracy of food stamp “eligibility police” be set up to monitor the assets of hard-hit people who’re just trying to get adequate food on their tables. This nonsense will cost tens of millions of our dollars to harass the poor in an autocratic hope of nabbing a couple of hungry families who have a dime more in assets than miserly Trumpistas claim they should have.

What we have here is government by plutocratic authoritarians who’ll gleefully dole out millions to a wealthy family and then just as gleefully go out of their way to deny food to millions of poor families.

819

https://www.alternet.org/2019/08/analysis-of-25-worlds-wealthiest-families-a-reminder-of-inequalitys-economic-drain/

no lnx

Analysis of 25 world’s wealthiest families a reminder of inequality’s economic drain

Written by Common Dreams August 11, 2019

If the world needed yet another example of just how unequal the global economy has become, a new analysis of the top 25 wealthiest family dynasties published Saturday revealed that while one out of ten people in the world live on less than $2.00 per day, these super rich families now control a total of $1.4 trillion in assets and are making as much as$4 million every single hour.

According to Bloomberg, the numbers are “mind-boggling” and include a look at—just to name a few—the fabulous riches of the Walton family, which controls the Walmart fortune, the Mars family, descendants of the candy empire, the Saudi Royal family, and the infamous Koch brothers, the right-wing libertarians who inherited their father’s oil, gas, and other holdings.

Notable in the new analysis is not just the size of the massive wealth these families now have, but just how exponentially it has grown, especially compared to others in the economy—both in the last several decades and over the last 12 months.

As Bloomberg points out:

Even in this era of extreme wealth and brutal inequality, the contrast is jarring. The heirs of Sam Walton, Walmart’s notoriously frugal founder, are amassing wealth on a near-unprecedented scale—and they’re hardly alone.

The Walton fortune has swelled by $39 billion, to $191 billion, since topping the June 2018 ranking of the world’s richest families.

Other American dynasties are close behind in terms of the assets they’ve accrued. The Mars family, of candy fame, added $37 billion, bringing its fortune to $127 billion. The Kochs, the industrialists-cum-political-power-players, tacked on $26 billion, to $125 billion.

So it goes around the globe. America’s richest 0.1% today control more wealth than at any time since 1929, but their counterparts in Asia and Europe are gaining too. Worldwide, the 25 richest families now control almost $1.4 trillion in wealth, up 24% from last year.

In 2014, the United Nations issued a scathing report which warned that escalating income and wealth disparities across the world was creating economic and political instability. The report, put forth by theU.N. Development Program (UNDP), cautioned leaders that if unaddressed the trend of inequality would “undermine the very foundations of development and social and domestic peace.”

Earlier this year, Oxfam International also warned that global wealth inequality was “out of control” and urged immediate far-reaching action. “Our economy is broken,” the group said at the time. “Hundreds of millions of people living in extreme poverty while huge rewards go to those at the very top. There are more billionaires than ever before, and their fortunes have grown to record levels. Meanwhile, the world’s poorest got even poorer.”

So while the Trump administration in the United States and other right-wing forces advocating on behalf of the global oligarchy continue to tell workers and struggling families around the world that the threat to them is “immigrants taking their jobs” or “socialists trying to provide better wages and more universal protections”—others pointed to the new Bloomberg analysis as an alternative explanation for why there seems to be less and less for some people in the economy while the ultra-rich continue to amass fortunes at breakneck speed.

As Common Dreams reported earlier this week, an analysis by Dallas Morning News finance columnist Scott Burns found that if current trends continue, the wealthiest Americans “will truly ‘have it all’ just 33 years from now”as they gobble up a larger and larger share of the overall economic pie.

“However you slice it, the rich have been getting richer. Lots richer,” Burns wrote.

https://www.alternet.org/2019/07/economist-james-k-boyce-explains-how-to-fight-climate-change-and-rising-income-inequality-in-one-shot/

no lnx

Economist James K. Boyce explains how to fight climate change and rising income inequality in one shot

Written by Lynn Parramore July 31, 2019

Every day it becomes clearer that we have to break our addiction to extracting dirty stuff from the ground to burn for energy. But how to pull it off without triggering political and economic chaos? Economist James K. Boyce, a senior fellow at the Political Economy Research Institute of the University of Massachusetts Amherst, is the author of a new book exploring that question, The Case for Carbon Dividends. In a conversation with the Institute for New Economic Thinking, he outlines a plan that could not only reduce carbon emissions, but help bridge the gap between the rich and the rest. And it might even survive the political system.

Lynn Parramore: You take it as a given that the key to reducing fossil fuel use is to put a price on carbon emissions. But some say that it won’t really impact climate change or that it will hurt the economy in various ways. How do you respond?

James K. Boyce: A price on carbon emissions is one key piece of the solution. But it can’t be just any price: it has to be anchored to an emissions-reduction trajectory that is consistent with climate objectives, such as the Paris target of limiting the increase in average global temperatures to 1.5-2 °C.

There are a several options for doing that. One is putting a cap on the total amount of fossil fuels allowed to enter the economy, a cap that would get lower over time. Then, we could auction allowances (also called permits) up to the limit set by the cap. Another option is a tax that is indexed to emission targets, so that the rate adjusts automatically as needed, sort of like an adjustable-rate mortgage. Or we could have a combination of the two, in which the tax is the floor price for permit auctions.

Arbitrarily setting a price and hoping it will do the job is a recipe for uncertainty at best and failure at worst. It’s true that most carbon prices across the world today are too low to have had a substantial impact on emissions. But that’s an argument for a more robust price, not for a price of zero. Just because you’ve tasted weak coffee doesn’t mean you should never drink coffee again.

Would a carbon price that is robust enough to do the job “hurt the economy”? Quite the contrary. What will really hurt the economy is failure to stabilize the Earth’s climate. A carbon price firmly anchored to emissions-reduction goals will reorient the economy towards greater energy efficiency and cleaner energy. The resulting innovation and investment will grow the economy, but grow it in a new direction, leaving behind the fossil-fueled era.

LP: What exactly are carbon dividends?

JB: Carbon dividends are equal payments to every resident funded with the revenue from putting a price on carbon.

LP: So that means once these revenues start rolling in, everybody gets checks in the mail?

JB: That’s the idea. Dividends can be disbursed monthly, quarterly, or annually. It’s not rocket science to do this. Alaska already pays dividends to all state residents with revenue from oil extraction. One could even front-load the payments, so that the first dividend arrives as soon as fuel prices go up.

The economic principle behind carbon dividends is called a “feebate”: individuals pay fees according to their use of a shared resource, and receive rebates by virtue of their common ownership of the resource. The idea can be illustrated by an analogy.

Suppose that 1,000 people work in an office building whose parking lot has only a few hundred spaces. If everyone could park free of charge, there would be chronic excess demand. To avert the resulting congestion, a fee is charged to limit demand for parking spaces to the lot’s capacity. Every month the money that is collected in parking fees is paid out as equal rebates to everyone who works in the building. Those who bicycle to work or take public transport come out ahead: they pay nothing to park and still get their share of the revenue. Those who carpool more or less break even. Those who commute every day in a single-occupancy vehicle pay more in fees than they get back.

Carbon dividends apply this idea to parking emissions in the atmosphere.

LP: How does your proposal fit into the idea of a Green New Deal?

JB: The centerpiece of the Green New Deal is investment and innovation in a clean energy economy that works for everyone, not just for the richest one percent. Carbon dividends fit perfectly with this idea.

Placing a strict limit on how much fossil fuel we burn – which increases their price – strengthens the incentives for individuals, firms, and governments to invest in the clean energy economy of the future. And dividends are paid to everyone, so the revenue from higher fuel prices, the carbon price, is not pocketed by the wealthy and powerful few. Carbon dividends are based on the principle that we all own the atmospheric parking lot in common and equal measure.

The net impact of the price-and-dividend policy on any household’s income depends on the size of its carbon footprint. Most low-income households come out ahead, since they consume less-than-average amounts of just about everything, including fossil fuels. Most middle-class households break even or come out a bit ahead. Upper-income households generally pay more in higher fuel prices than they get back in dividends, because of their higher consumption of just about everything, including fossil fuels.

LP: So that keeps carbon taxes or prices from hurting people who can least afford it, like truck drivers or ordinary commuters.

JB: Right. In industrialized countries like the U.S., fuels are more of a necessity than a luxury. As a percentage of their incomes – although not in terms of absolute dollars – the poor spend more on fossil fuel than the middle class, and the middle class spends more than the rich. In the absence of dividends, in other words, carbon prices are tantamount to a regressive tax.

One possible alternative use for carbon revenue is to fund public investment, including investments in a Green New Deal. It would be possible to use some revenue for this purpose and some for dividends. Back in 2009, for example, Senators Maria Cantwell (D-WA) and Susan Collins (R-ME) introduced a bill that would have capped emissions, auctioned permits, returned 75% of the revenue to the people as dividends, and devoted the remaining 25% to public investment. But it would be an irony – and a serious political liability – if the Green New Deal were funded mainly by a regressive tax.

LP: How would the carbon dividends plan be implemented?

JB: It’s pretty straightforward. We know how to auction carbon permits. The northeastern states, for example, have been doing it four times a year for the past decade in the Regional Greenhouse Gas Initiative for curbing power plant emissions. We know how to pay dividends. The Alaska Permanent Fund has been doing it for more than 30 years.

The easiest way to disburse dividends is via electronic payments. Just like Social Security and veterans’ benefits. Those who prefer them can get checks in the mail. A compelling advantage of disbursing dividends as stand-alone payments, rather than in the form of income tax credits or by some other indirect route, is to ensure that they are completely visible to the public. This visibility is crucial for the political durability of carbon pricing. People will see fuel prices rising at the pump. At the same time, they need to see the revenue coming back to them in a fair and transparent manner.

To protect energy-intensive, trade-exposed industries, most carbon pricing proposals include border adjustments like carbon tariffs on imports and rebates to exporters. That way, companies can maintain their competitiveness vis-à-vis producers in locations without a comparable carbon price.

The price-and-dividend plan could be implemented by individual states, too. One way to tackle the competitiveness issue at the state level is to set aside a share of the total carbon revenue equal to what is paid by businesses, and to rebate this to firms in equal amounts per employee. A side-benefit of this would be to strengthen incentives for job creation. The same can be done for local governments. This has been proposed in Massachusetts.

LP: How does this idea win support across the political spectrum?

JB: I use the term “libertarian socialism” to describe the underlying philosophy behind carbon dividends. The concept is libertarian in its respect for the individual, and socialist in its commitment to equality. Today the labels “libertarian” and “socialist” are usually affixed to opposite ends of the political spectrum. But there is a strong connection between the egalitarian distribution of power and the egalitarian distribution of wealth, central tenets of liberty and socialism, respectively. Carbon dividends are consistent with both.

In the U.S., carbon dividends have gained support on both sides of the political aisle. The Cantwell-Collins bill was the last bipartisan climate legislation proposed in the Senate. A new House bill called the Energy Dividend and Carbon Dividend Act is co-sponsored by a Democrat and a Republican. Democratic Senator Chris Van Hollen of Maryland, who championed carbon dividends as a Congressman, has proposed a new bill in the Senate. Republican elder statesmen George Shultz and James Baker are among the co-authors of “The Conservative Case for Carbon Dividends,” a proposal advanced two years ago by the Climate Leadership Council (CLC). The Citizens’ Climate Lobby, a non-partisan advocacy group, has been working to build grassroots support for carbon dividends around the country.

In my view, bipartisan support is essential if climate policy is to be politically durable. An effective climate policy cannot be a one-off victory: it must endure long enough to see the clean energy transition to its conclusion. A policy that is vulnerable to being scrapped when there is a change of power in Washington won’t cut it.

The Yellow Vest movement that broke out in France last November was sparked by the Macron government’s announcement of a fairly modest increase in fuel taxes. The reaction is a loud and clear warning of the dangers in any policy that combats climate change at the expense of working people. Political leaders and clean energy advocates around the world have taken notice. German Green Party co-leader Annalena Baerbock recently said, “the lesson from France is that we cannot save the climate at the expense of social justice.” I think that is absolutely right. Carbon dividends are a way to combine the two.

LP: How do we overcome the big-money influence of those invested in the fossil-fuel economy? Who is currently supporting carbon dividends and who is opposed?

JB: Good question. For starters, it’s important to distinguish between capital and labor. Fossil capital faces losses in the form of stranded assets: plant and equipment, and reserves in the ground, whose market value will fall in some cases to zero in the clean energy transition. I don’t feel overly sorry about this. It’s what happens to firms in a market economy when they make bad investment decisions. I hope that betting on continued use of dirty energy will turn out to be a really, really bad decision.

In the meantime, these firms had a pretty good run for their money.

Labor – and here I mean not only workers in the fossil-fuel sector but also communities that depend on them – is a different matter. The workers and communities that provided our energy in the past performed a great service. They need and deserve assistance as we shift to the clean energy economy. A just transition is a key component of the Green New Deal.

Fossil capital is likely to oppose any policies that would sweep its assets into the dustbin of history. The only way to overcome this opposition is to build a broad and deep alliance among everyone who puts the long-term well-being of our children, our grandchildren, and humankind ahead of the short-term greed of those who profit in the fossil-fuel status quo.

But it’s been interesting to see that some energy firms, including ExxonMobil, Shell, and BP, came out in support of the Climate Leadership Council’s (CLC) “conservative case” for carbon dividends.

LP: Is that kind of support a sign that there’s something wrong with the idea of carbon dividends?

JB: It’s important to distinguish the baby from the bathwater. I think there are two specific features of the CLC plan that made it palatable to some oil-and-gas firms. The first is the initial carbon price: $40 per ton of carbon dioxide. This would be enough to spur the shutdown of coal-burning power plants in favor of natural gas-fired plants, expanding the market for gas producers, while not being high enough to make a serious dent in demand for transportation fuels. The plan was vague on how the price would increase over time, but for Big Oil $40 may be just about the sweet spot.

The second inducement was a curious line of legalese inserted in the CLC plan saying that carbon taxes “would make possible an end to federal and state tort liability for emitters.” There is no intrinsic connection whatsoever between a liability waiver and carbon dividends. I can only surmise that this was put in as a carrot for the corporations. If so, and if this was enough to get them to sign on, it reveals just how deep the anxiety runs in boardrooms about the prospect of being held to account for the colossal harm that fossil fuel corporations have inflicted on people and the planet. The precedents of Big Tobacco, the demise of Union Carbide after the Bhopal chemical disaster, and the bankruptcy of Johns-Manville Corporation due to asbestos liability are instructive here. I regard corporate liability as a valuable bargaining tool that should not be relinquished lightly.

In speaking to diverse audiences about carbon dividends, I’ve often been asked, “This seems like a great idea – why haven’t I heard of it before?” I explain that it’s because no one stands to get rich from carbon dividends. No big-money interests are paying anyone to publicize the idea. The only way we will get carbon dividends – and the only way we will see effective solutions to the climate crisis – is for the people to join together and demand them. That is the bottom-line message of the book.

aha: matthew effect, dark money lobby corruption and financialization funnels money to the top; thus low and Middle class ppl go into debt; everything is more expensive relatively if you're poor /working class (eg no bank acct means cash check at walmart they take a cut or payday loan that takes a big one); worse are predatory capitalist who prey/extract (pay phones on street but esp in prison).

7/23/19

see Liz warren on howdebt (personal and banksters) creates systemic risk and instability.

related to inequality. linkage too to AGW EJ

thom h on nader Radio

http://classonline.org.uk/pubs/item/why-inequality-matters

2012

Does inequality matter? For a generation, inequality has been increasingly dismissed as an irrelevance: all that mattered was that the living standards of all were improving. It has certainly been a long time since that has happened: four years before the economic crisis began, the real income of the bottom half began to flat-line; for the bottom third, it actually declined.

This booklet has been produced by members of My Fair London in response to requests from politicians, trade unionists, and members of the public and draws on the bestselling book 'The Spirit Level' by Professors Richard Wilkinsonand Kate Pickettwhich shows that most social problems are worse in more unequal societies and that inequality lies at their root.

i dl 719 : http://classonline.org.uk/docs/Why_Inequality_Matters.pdf 32 pp

But why should this be the case?Well tested and independent evidence shows that: · Beyond a certain point, increased national income does not improve the quality of life in a society, but greater equality does. Inequality within a country is what matters, not differences in average income between countries.

Inequality harms us all in many ways. Early studies showed how itaffected health,but there is now much evidence showing the negative effects on all sorts of issues. Although the poorest fare worst, a massive gulf between those at the bottom and those at the top harms everyone, whether they are rich or poor.

In rich countries, a smaller gap between rich and poor means a happier, healthier and more successful population. The most unequal countries, the US, the UK, Portugal and Singapore have much worse social problems than the most equal countries of Japan, Sweden and Norway.

If the UK were more equal, we’d all be better off as a population. For example, the experience ofmore equal countries shows that, if we halved inequality here, murder rates and obesity would halve too; mental illness would reduce by a third; imprisonment rates and births to teenage mothers would decrease to a fifth: and social mobility and levels of trust would greatly improve. ...

There is widespread public support for the idea that too much inequality matters:· Two recent surveys show that most Britons want the Government to reduce inequality, even though they assume the UK is more equal than it is. 60% agree that working people do not get their fair share of the nation’s wealth, up from 53% in 2004. Only 19% thought it not the responsibility of the Government5 .

In the United States, Republican voters shown how wealth is spread in the US and in Sweden, but not told which set of figures described which country, thought the Swedish distribution better. US voters overall chose as ideal a wealth distribution that was more equal than Sweden’s. (In Sweden, the top 20% of earners get four times the lowest earning 20%; in the US the difference is eight times.)

· Alan Greenspan, former Chairman of the US Federal Reserve, says that increasing inequality is bad for business 6 . Our current Prime Minister and 75% income tax 11 leaders of the other main parties have supported the idea of greater equality. The right wing press has also attacked increasing inequality, particularly the gap between the well to do and the extremely rich. Inequality is rightly seen to have bad effects on everybody, not just the poor.

· The International Monetary Fund has published evidence that inequality led to the huge debts behind the 2008 bank crisis and that more equal incomes can be a better solution than bank bailouts 7 .

· Banking insiders have criticised the current system, whereby the greatest rewards go to those in finance, often for unproductive money shuffling, and at the expense of production of real goods and services 8 . For poorer countries, increasing the national income is crucial so that its citizens have basic necessities. But for developed countries, where living standards are much higher, having more and more of everything makes less and less difference to well being and quality of life. What is much more important is how wealth is shared. However, if growth is the aim, more equal societies are well placed to achieve it.

...

https://yyy.theguardian.com/inequality/2018/sep/18/kate-pickett-richard-wilkinson-mental-wellbeing-inequality-the-spirit-level

Interview

Kate Pickett and Richard Wilkinson: ‘Inequality strikes at our health and happiness’

Dawn Foster

Social injustice has a profound psychological impact – and it’s tearing our society apart, say the authors of The Spirit Level

Dawn Foster @dawnhfoster Email

Tue 18 Sep 2018 13.00 BST Last modified on Wed 19Sep 2018 15.32 BST

New analysis this week showing that 14 million people live in poverty highlights just how unequal a society the UK has become. Poverty is particularly prevalent among disabled people, single parents, unemployed people or those working irregular or zero-hours jobs.

It follows recent research by the OECD showing that social mobility has stagnated, with a child from a poor family in the UK taking five generations on average to earn the average wage, compared to two generations in Denmark, and three in Finland, Norway and Sweden.

It’s hardly surprising, according to Kate Pickett and Richard Wilkinson. The married academics’ 2009 book, The Spirit Level, on the effects of inequality on societies across the world, sold over 150,000 copies in English alone, and was lauded across the political spectrum.

Nine years on, things have not improved. The Inner Level, their long-awaited follow up published earlier this year, looks at the more personal, individual effects of inequality: how the social effects of the gap between rich and poor impact on people. “We’re talking about how inequality affects our intimate lives, our inner lives; our mental wellbeing, our relationships with friends and family,” Pickett says.

The Inner Level examines a society that has dealt with 10 years of austerity, and seen almost every family impacted by stagnant wages, increased job insecurity, swingeing cuts and changes to the benefits system and public services nationally and locally, as well as a surge in problems with mental health across society. “It takes a whole argument and evidence about the effects of inequality to a deeper and more intimate level. In The Spirit Level we were dealing with things about society ‘out there’ – the size of the prison population, homicide rates, obesity rates and so on. But this takes it into the sphere of our social fears and anxieties,” Wilkinson says. “Worries about self worth: all the things that make social contact sometimes seem rather awkward and stressful. Your fears about self presentation and so on are all exacerbated by inequality.”

The problems scrutinised in the book – self doubt, social anxiety, stress, and fear of how we are seen by others – have an impact on day-to-day emotions for individuals, but also a wider impact on relationships, our ability to build functioning communities, and the health and wellbeing of entire populations. These issues are massively exacerbated by inequality, and a belief in meritocracy means that any failure is deemed a personal failure, the book argues. “The reality is that inequality causes real suffering, regardless of how we choose to label such distress. Greater inequality heightens social threat and status anxiety, evoking feelings of shame which feed into our instincts for withdrawal, submission and subordination: when the social pyramid gets higher and steeper and status insecurity increases, there are widespread psychological costs.”

The stress of poverty also influences the cognitive development of babies and children. Measuring the levels of the stress hormone cortisol in infants found that poverty, and the amount of time spent in poverty, can hamper the mental development of children. Pickett and Wilkinson find that “family income is a more powerful determinant of cognitive development than being brought up by single parents, or maternal depression”, and that if children are enrolled in support services like Sure Start and their equivalents in other countries, some of the effects of poverty are offset, and children’s educational and psychological performance improves.

[New study finds 4.5 million UK children living in poverty

Inequality: The Enemy Between Us? Why Inequality Matters

By Richard Wilkinson and Kate Pickett

Published in Spring | Summer 2010

Why do the poor suffer more from almost every health and social problem? Death rates are higher from cardiovascular disease, infections and many cancers among the least well-off; so too are violence, drug abuse, obesity, teenage births and school failure. Some people might think this is caused by the most vulnerable and least healthy people moving down the social hierarchy. Others suggest that these problems are caused by lower material standards of living—poor housing, poor diets, etc. Some think that intelligence or genetic factors are the explanation.But increasingly, people doing research on inequalities in health have suggested that it is low social status itself that is the problem. Whatever the reasons for the common link with poverty and deprivation, all of these problems tend to be treated separately. Different academic researchers study health and crime; different governmental departments deal with education and justice. Given that maps of any one of these problems across local areas in Britain would look the same, it’s surprising that the common roots in relative deprivation receive so little attention.

After many years of research, we have discovered another feature that is shared by all these health and social problems. They are all more common in more unequal countries. By more unequal, we mean bigger differences between rich and poor. Among the rich market economies of the world, there are stark differences in income inequality. Among the more equal societies are the Nordic countries and Japan, where the incomes of the top 20% are 3-4 times as big as the incomes of the poorest 20%. Among the more unequal societies are countries like the US, Portugal and the UK, where the richest 20% are 8 or 9 times as rich as the poorest 20%. It looks then as if the problems associated with deprivation within a country all become more frequent as material differences increase.

What is surprising is how big the differences are. Mental illness is three times more common in more unequal countries than in the most equal, obesity rates are twice as high, rates of imprisonment eight times higher, and teenage births increase ten-fold.

Another surprising finding is that there is no relationship at all between average levels of income, such as Gross National Income per capita, and health or child well-being.A country can be twice as well off as another and still not have better life expectancy, infant mortality or standards of child well-being. Everyone getting richer appears to make no difference to the levels of health and social problems in a society. Yet, within each country, all these problems are closely related to any measure of income, education, social class, etc. So differences in living standards within countries seem to matter, but differences in living standards between countries don’t. How can we explain this paradox?

If health and social problems are concentrated among the poor because the vulnerable and unhealthy drift down the social scale, this doesn’t explain why they are so much more frequent in more unequal countries. Similarly, it can’t be explained in terms of any fixed factor, such as genetics, because levels of these problems change over time—think of the current obesity epidemic or the rise in imprisonment. If they were the result of low material living standards, they would surely diminish with economic growth. What seems to matter is not absolute standards of living but the differences between us.

In our book, The Spirit Level: Why More Equal Societies Almost Always Do Better, we test these patterns in two separate test-beds, not only among the rich, developed countries, but also in comparisons of the 50 US states. The picture that emerges is almost identical in both settings. Our findings confirm the widely-held intuition that inequality is socially corrosive.

Although it has been said that there are “lies, damned lies and statistics,” statistical methods provide us with a sort of social microscope, they show us important patterns that we fail to see unaided. For example, civil servants working in government oﬃces were completely unaware that age-adjusted death rates were 3 times as high among staff low down in the oﬃce hierarchy than among those in more senior positions.

The picture that emerges from the statistics is that inequality damages social relationships.Measures of trust and social cohesion are higher and violence is lower in more equal societies. And similarly, studies show the reason that rates of imprisonment have increased in more unequal countries and US states owes much more to harsher sentencing than to rising crime rates. Even small differences in inequality seem to make a huge difference to our quality of life. We’re not examining the effects of some imaginary egalitarian utopia. We’re analysing the effects of existing differences in the amount of inequality among advanced market economies.

It might be thought that more unequal societies do worse because they have more poor people, but this is only a small part of the explanation. Just as health inequalities are not simply differences between the health of the poor and everybody else, but instead go all the way up the social ladder, with even those close to the top doing a bit worse than those above them, nor is the impact of inequality confined to the poor. Indeed, you cannot explain such big differences in rates of health and social problems between more equal and more unequal societies by what is happening among the poor. The differences are big because everybody is affected. Greater inequality seems to harm almost everyone.

What seems to matter is not absolute standards of living but the differences between us.

Where the data allow us to compare people at each level of income or education or social class between one country and another, it is clear that even the comfortable middle class does better in more equal countries. Even well educated people with good incomes will be likely to live longer and enjoy better health, and their children will do better in school, will be less likely to take drugs and less likely to become teenage parents. Everyone will enjoy the benefits of living in a more trusting, less violent society. Although the benefits of greater equality are much larger lower down the social scale, they are still apparent even among the well-off.

The reason why almost everyone benefits from greater equality is that more equal societies are more collaborative, with less status competition. With bigger material inequalities, people become more worried about how they are seen and judged, more vulnerable to status anxieties. So much so that more unequal societies become more consumerist—people work longer hours, save less of their income and are more likely to get into debt. Greater sensitivity to how we are valued or respected explains why violence is more common in more unequal societies. Disrespect, humiliation and loss of face are common triggers to violence. Perhaps the reason why rates of mental illness are so much higher in more unequal countries is because the quality of social relationships and feeling valued have always been crucial to human well-being.

Some Facts About Inequality in the United States – by David DeGraw

The US has the highest inequality rate in the industrialized world.
The top 1% now owns over 70% of all financial assets.
From 1980 to 2006 the richest 1% of Americans tripled their after-tax income while the bottom 90% lost 20%.
CEOs in 1970 earned $25 to 1 for the average worker. Today it is $500 to 1.
While the average person lost 25% of their 401k during the 2008 financial crisis, the richest 400 gained $30 billion.
If our income had kept pace with compensation distribution rates established in the early 1970s, we would all be making at least three times as much as we are currently making. How different would your life be if you were making $120,000 a year, instead of $40,000?

Other human beings have the capacity to be our most feared rivals or our greatest support, cooperation and security. We have evolved to be very sensitive to the quality of social relationships. Status matters, but so does friendship among equals. Material inequalities play a crucial role in putting barriers between us. When these differences are larger, the balance shifts from us trusting other people and viewing them as friends to mistrust and competition for status.

More equal societies don’t just function better internally; this seems to carry over into their external relations. More equal countries give more in foreign aid and score better on the Global Peace Index. They recycle a higher proportion of their waste and think it more important to abide by international environmental agreements.

Injustices of wealth and poverty have always been central to the Christian message. In our book, we include a cartoon that shows a rich business man instructing his secretary to buy up the rights to the Bible and “get that part changed about the rich man and the eye of the needle.” It is, of course, one thing to explore these issues from an academic standpoint, but quite another to change the society we live in. As well as outlining the evidence in our book, we have also helped to set up The Equality Trust (www.equalitytrust.org.uk) with the help of a grant from the Joseph Rowntree Charitable Trust to campaign for a fairer society, to benefit us all.

Note. This article was originally published in the Church Times, London. ©Richard Wilkinson

https://www.theatlantic.com/business/archive/**2015/**06/what-matters-inequality-or-opportuniy/393272/

no lnx

Lately, one argument that’s been making the rounds is that people should worry less about inequality and more about opportunity. Arthur Brooks, head of the conservative American Enterprise Institute, said, “I don’t care about income inequality per se; I care about opportunity inequality.” Senator and presidential candidate Marco Rubio believes that inequality is but a symptom of immobility and constrained opportunity. Tyler Cowen argued in the New York Times that what matters is not the fact that the top 1 percent is capturing a much larger share of total income growth than they used to, but that the poor are stuck in poverty.

These individuals have identified a worthy goal. Unequal access to opportunity offends deeply held American values, and poverty is not only a matter of near-term material deprivation—too often, it also robs low-income children of the chance to realize their intellectual and economic potential.

But it’s not possible to effectively address either poverty or inadequate opportunity if America hives off its opportunity concerns from the broader problem of inequality (nor, as Senator Rubio intimates, can America reduce inequality by focusing solely on increasing mobility). Boosting mobility will require reductions in wage, income, and wealth inequalities.

For many in the opportunity-not-inequality camp, the relationship between the two concepts is an inconvenient truth. Concerns about inequality smack of “class warfare,” of “going after” the top 1 percent and Wall Street.Cowen is revealing in this regard: “The inequality focus tends to draw us to redistribution, whereas a mobility focus is more conducive to ideas for wealth creation.”

Many politicians and analysts would rather not address the power imbalances that have channeled so much of our economic growth to the highest-income families. They are much more comfortable focusing on the benign-sounding theme of “wealth creation” or insisting that economic growth alone can improve mobility without any redistribution of resources or political power, as if “a rising tide can lift all boats” matters when a few people are in yachts and many are stuck in dinghies.

But a growing body of research shows strong links among inequality, poverty, and opportunity. For example, new research by Elise Gould of the Economic Policy Institute reveals that of the factors most commonly cited as driving poverty in America—education, family structure, race and more (see chart below)—the number-one factor by far is the growth in inequality, which added seven percentage points to the poverty rate since the late 1970s.

So why is that? How is it that inequality reduces mobility and deepens poverty?

* * *

The relationship between childhood family income and life outcomes is well-established. Socioeconomic status is unfortunately the strongest predictor of a child’s academic achievement, as decades of social science research have found. A child’s income rank—her family’s income relative to the household income of other families—makes a difference for that child’s future adult-income rank as well. Research by Raj Chetty of Harvard and his colleagues links every 10-percentile-point gain in childhood income rank with a 3.4-percentile-point gain in income rank as an adult. Since inequality by definition means that less income will reach poor and middle class Americans for any given rate of economic growth, these facts alone highlight inequality’s relevance to mobility discussions.

In addition, a large and growing body of evidence, recently reviewed by Katharine Bradbury and Robert Triest of the Federal Reserve Bank of Boston, directly connects inequality of outcomes to inequality of opportunity. As shown in the figure below, Bradbury and Triest find a significant, negative relationship between living in an area with greater income inequality and children’s expected upward mobility.

The Relationship Between Inequality and Mobility

[no grafs]

Commuting zones with greater inequality have reduced expected upward mobility for low-income children (Center on Budget and Policy Priorities)]

It’s critical to understand the fundamental difference between these findings and the Cowen, Rubio, et al. view that America can address poverty without addressing inequality. As just noted,rising inequality implies that the income and wealth generated by GDP and productivity growth increasingly flow to those at the very top of the scale. As a result, relatively fewer resources reach everyone else. One thus would expect to see low-income families less able (relative to the wealthy ones) to invest in children’s futures, more indebted if they tried to go to college, more likely to be stuck in neighborhoods that lack opportunity, and more likely to experience the stressors that do permanent damage to children’s later educational and earnings outcomes.

And that’s exactly what happens.

Research indicates at least three causal pathways via which inequality constrains opportunity for those at the lower end of the economic spectrum.

First, inequality is driving increasing residential segregation by income. The shares of families in neighborhoods of concentrated poverty and neighborhoods of concentrated wealth both more than doubled between 1970 and 2009, while the share of families in middle-income neighborhoods declined from 65 percent to 42 percent. Those high-poverty neighborhoods—where more and more families are living—create lasting disadvantages for many who grow up there: If a family with young children (less than age 13) relocates from a high- to a low-poverty neighborhood, the kids achieve better academic and economic outcomes later in life, as new work by Chetty et al. indicates.

Second, inequality leads to unequal access to quality educational experiences throughout a child’s lifetime. Over the period of growing inequality, these disparities have increased. In 1995, for example, families with education debt in the bottom half of the net worth distribution (a broader definition of income, including assets minus liabilities) had a mean debt-to-income ratio of around 0.26, meaning that for every dollar of their income, they owed 26 cents in college debt. For families in the top 5 percent, that ratio was eight cents on the dollar. But by 2013, the debt-to-income ratio had more than doubled to 0.58 for the bottom half (some of whom are poor but many of whom are middle class) while remaining unchanged for those at the top.

Third, and most importantly, inequality directly undermines equality of opportunity, likely through a variety of mechanisms.As the gap between the rich and poor widens, lower-income families have less ability relative to their rich counterparts to invest in enrichment goods for their children. Children from families with less income have relatively less extensive and privileged social networks and, compared to their rich peers, are more likely to experience the type of "toxic" stress that can hamper brain development and long term academic, health, and economic outcomes.

In short, inequality entrenches immobility not just by enabling increasingly unequal transfers of wealth from one generation to the next, but also through a number of more subtle pathways that affect opportunity on a daily basis. It may not yet be possible to explain all of these subtle pathways with great certainty, but the fact that “rich and poor children score very differently on school readiness tests before they enter kindergarten” should be viewed as an unsurprising consequence of the high levels of inequality American society currently tolerates.

Members of the “don’t-mess-with-the-rich-to-help-the-poor” crowd also ignore the political dimension of inequality. While Rubio, Paul Ryan, and others are professing their concern for the poor, they’re busy trying to repeal the estate tax (at a cost of $270 billion over 10 years) and writing budgets that gut the safety net. These policies restrict mobility at both the bottom and top by exacerbating the burdens of being poor, increasing the privilege of being born into riches, and eliminating revenue sources for investments that might begin to reverse the inequality of opportunity. Why do politicians pursue such policies? Because they are nudged along by the interests of wealthy donors. Inequality begets greater inequality.

In other words, disadvantages faced by children in low- and middle-income families and advantages held by their wealthy peers are two sides of the same coin. The lack of opportunity for those in poverty is not some separate problem from the unequal distribution of wealth and income across society.

* * *

Boosting mobility therefore requires directly addressing residential segregation, educational access, and other barriers described above. Here are some ideas that hold promise:

One conclusion that stems from the Chetty et al. findings regarding the benefits of moving from high- to low-poverty areas is to improve the Department of Housing and Urban Development’s Housing Choice Vouchers (HCV) program. Housing analysts Barbara Sard and Doug Rice recently detailed a number of specific, straightforward changes that could eliminate barriers for voucher recipients to move into low-poverty areas, including tying voucher subsidies to rent in specific zip codes instead of entire metropolitan areas. Importantly, such a change could be implemented without significant funding or even congressional action, and HUD has just announced that it is considering doing so.

To balance the educational playing field beginning at the starting gate, America needs a robust, publicly funded pre-K program. A 2013 proposal from the Center for American Progress that would make pre-school free for kids in low-income families and partially fund tuition for higher-income kids would be a good start, though at $10 billion a year, it’s not cheap. Still, research summarized by the Council of Economic Advisers suggests that the economic gains, higher tax revenues, and lower public costs from the children who would benefit from this investment would offset part of these costs in the long run.

America also needs more equitable funding for K-12 education at both the federal and state levels. That means both funding increases—real overall state and local per pupil funding has declined in 35 states since 2007—and changes in the distribution of funding, which is inequitable in part because of the reliance on local property tax revenue, and because of the political power that affluent communities have.

Evidence also shows that college enrollment and completion can be boosted by providing students with relief from the rapidly-escalating costs of tuition and other school-related expenses. It is thus important to at the very least protect recent improvements in Pell grant awards and eligibility (which are under attack by Republican budgets), and to potentially consider more ambitious ideas for free college along the lines of what Bernie Sanders has proposed.

While the above recommendations are important, growing up with less income significantly inhibits mobility even after taking educational access into account. As research by the Pew Economic Mobility Project indicates, children born into the bottom quintile who obtain a college degree are 2.5 times less likely to end up in the top quintile of the income distribution as adults than children who grew up in wealthy families but did not graduate college. In addition, changes to HUD’s voucher program, while extremely valuable for the roughly 250,000 children who could benefit in the near-term, do not get at the root causes of neighborhoods of concentrated disadvantage. Policies that directly address inequality and poverty by boosting the incomes of poor and middle-class families are essential for maximizing mobility.

One proven way to do so is through safety-net programs like the Earned Income Tax Credit (EITC), Supplemental Nutrition Assistance Program (food stamps), and Medicaid. These are redistributive programs (just as Cowen feared) and the added income they provide do not simply reduce poverty now: An important new line of quasi-experimental research on these programs also shows that they function as longer-term investments over children’s lifecycles. As summarized by Marr et al., research has suggested, for example, that “a $3,000 increase in family income (in 2005 dollars) between a child’s prenatal year and fifth birthday is associated with an average 17 percent increase in annual earnings and an additional 135 hours of work when the children become adults, compared to similar children whose families did not receive the added income.”

That evidence and similar evidence for food stamps and Medicaid reinforces the importance of maintaining and in many cases strengthening safety-net programs.In terms of the EITC, both President Obama and Representative Paul Ryan have recommended expanding the benefits for childless workers, who currently receive very little of the credit. Key provisions of the EITC and the Child Tax Credit are also set to expire in 2017, and these provisions should be made permanent as well. In addition, states that haven’t yet done so should adopt the Affordable Care Act’s Medicaid expansion, especially since the federal government shoulders almost all of the costs. SNAP should be expanded, too, as a recent estimate by the Urban Institute suggests that a 30 percent increase in SNAP benefits “would reduce child poverty by 16 percent, lifting 1.8 million children out of poverty.”

More progressive taxation of inheritances and returns of wealth (capital gains) would be sensible, just, inequality-reducing, and mobility-enhancing ways to finance such initiatives.

Finally, since most working families depend on paychecks that have been hurt by diminished job quantity and quality, improving job-market outcomes for low- and moderate-income households is another essential strategy to offset the direct effects of inequality on opportunity. That means ideas like raising the minimum wage, protecting collective bargaining, and getting to full employment are integral parts of the effort to expand the opportunity set for kids of low- and middle-wage working parents.

* * *

That inequality and immobility are intimately linked—and that we can’t effectively reduce the latter without also reducing the former—should not be surprising. As more of the benefits of growth flow to a narrower slice of households at the top of the wealth scale, it becomes increasingly more challenging for the majority on the wrong side of the inequality divide to make the investments in themselves, their children, and their neighborhoods that can foster their mobility. Once political power is added to the mix—the established fact that the beneficiaries of high inequality are disproportionately influencing public policy on their behalf—the opportunities for the middle class and poor to build better lives become even more limited.

Attacking immobility means attacking inequality. To pretend otherwise will only preserve the unfairness that’s at the heart of the American economy today.

JARED BERNSTEIN is a senior fellow at the Center on Budget and Policy Priorities. From 2009 to 2011, he was the chief economic adviser to Vice President Joe Biden.

BEN SPIELBERG is a research assistant at the Center on Budget and Policy Priorities.

AHA NB inequality and polarization linked cf amazon:

mitchell the nation

...

As a result of the economic shifts that Amazon is helping to propel, the country is being divided into a starkly unequal geography. Only a handful of metro areas are gaining significant numbers of good jobs from Big Tech. And as the formation of new businesses declines, they’re also being consolidated into fewer places: In contrast with previous recoveries, when new firms were widely dispersed, half of all businesses started between 2010 and 2014 were located in just five metro areas. Even winning cities are marked by disparity: In Seattle, where Amazon is headquartered, the median home value now exceeds $700,000, while the unsheltered homeless population doubled over 10 years. It’s not hard to imagine a future in which Amazon’s cashier-less supermarkets and nondescript bookstores populate better-off neighborhoods, while other communities become increasingly barren of commercial activity.

In the left-behind towns and neighborhoods, the despair that has set in stems from more than just economic hardship. There is a pervasive sense of powerlessness that is toxic to democracy. In 1946, the sociologist C. Wright Mills and the economist Melville J. Ulmer published a detailed study of several matched pairs of cities. The cities in each pair were similar in all respects except for one main difference:One city’s economy was composed of many locally owned firms, while the other’s was largely controlled by absentee corporations. The cities that possessed a degree of local economic power had a bigger middle class and a greater variety of jobs, Mills and Ulmer found. But their most important findings had to do with civic health. The cities with a robust local economy invested more in public infrastructure and services, and their residents were involved in community affairs in greater numbers.

The Everything Store: The growing share of online shoppers who start their search on Amazon

Today, using large-scale statistical techniques, sociologists have confirmed Mills and Ulmer’s broad conclusions, finding, for example, that communities that possess more local economic power are better able to solve problems. But these ideas are no longer reflected in policy. Now, instead of actively seeking to disperse economic power, policy-makers encourage its concentration. Many elected officials are as enthralled with Bezos as his investors are, and they’ve been equally willing to fund Amazon’s growth. Congress has repeatedly declined to pass legislation that would allow states to require out-of-state retailers to collect sales taxes. This allowed Amazon to largely avoid collecting sales taxes for nearly two decades, giving it a price advantage that research shows helped drive shoppers to its site. Then, as Amazon’s warehouse expansion began to compel its compliance with sales taxes, the company started angling for local development incentives. It’s raked in more than $1.1 billionthrough these deals, according to Good Jobs First, and more than half of the warehouses that Amazon built between 2005 and 2015 received public subsidies....

-: American Promise Board member, author, and Harvard professor, Lawrence Lessig, discusses the decline of our democracy and the rise of corruption on TEDx.

https://www.youtube.com/watch?v=PJy8vTu66tE&feature=youtu.be

oct 2016

Our democracy no longer represents the people. Here's how we fix it | Larry Lessig | TEDxMidAtlantic

money primary is tweedism (don't care about electing, just nominating)

ineq --> tweedism --> corruption

https://www.ecowatch.com/un-expert-climate-apartheid-2638989833.html

UN expert painted a bleak picture Tuesday of how the climate crisis could impact global inequality and human rights, leading to a "climate apartheid" in which the rich pay to flee the consequences while the rest are left behind.

The warning came in the form of a report by UN Special Rapporteur on extreme poverty and human rights Philip Alston, which found that climate change could push a further 120 million people into poverty within the next 10 years, CNN reported.

"Climate change threatens to undo the last 50 years of progress in development, global health, and poverty reduction," Alston said, according to guk [twt]

Increased inequality and scarcity could then lead to nationalistic, racist and xenophobic movements that would threaten democracy and the rule of law.

"Human rights might not survive the coming upheaval," the report concluded, according to The Guardian.

The report criticized governments for not doing enough to reduce emissions, singling out U.S. President Donald Trump for rolling back environmental regulations and denying science and Brazilian President Jair Bolsonaro for his plans to open up the Amazon rainforest to mining interests. It also warned of depending on the business community to address the crisis, Reuters reported. It was in this context that the report raised the issue of "climate apartheid."

"An over-reliance on the private sector could lead to a climate apartheid scenario in which the wealthy pay to escape overheating, hunger, and conflict, while the rest of the world is left to suffer," Alston wrote.

He gave as an example something that already transpired during an extreme weather event, according to The Guardian:

"When Hurricane Sandy wreaked havoc on New York in 2012, stranding low-income and vulnerable New Yorkers without access to power and healthcare, the Goldman Sachs headquarters was protected by tens of thousands of its own sandbags and power from its generator."

The crisis will also worsen inequality between nations. Developing nations will pay at least 75 percent of the price for climate change while the poorer half of the world's population only contributes 10 percent to global emissions, as BBC News reported.

"Perversely, while people in poverty are responsible for just a fraction of global emissions, they will bear the brunt of climate change, and have the least capacity to protect themselves," Alston said in an announcement.

Alston will present the report formally to the UN Human Rights Council in Geneva on Friday...Ashfaq Khalfan of Amnesty International agreed with the report's findings.

"Climate change is a human rights issue precisely because of the impact it's having on people. The primary obligation to protect people from human rights harms lies with states. A state that fails to take any feasible steps to reduce greenhouse gas emissions is violating their human rights obligations," Khalfan told The Guardian.

Sanders and Barbara Lee introduce Inclusive Prosperity Act: ‘A small tax on Wall Street to make big change’

Eoin O'Carroll / Common Dreams

“It is long past time for Congress to rein in the recklessness of Wall Street billionaires and build an economy that works for all Americans.”

Stiglitz

Nobel Prize-winning economist, Columbia University professor and chief economist for the Roosevelt Institute. He served as chair of the Council of Economic Advisers under President Bill Clinton. His new book is_{ People, Power, and Profits: Progressive Capitalism for an age of discontent}_

https://www.democracynow.org/2019/4/24/economist_joseph_stiglitz_capitalism_hasnt_been

...

GONZÁLEZ: Well, Disney heiress Abigail Disney is speaking out against wage inequality, calling Disney CEO Bob Iger’s salary, quote, “insane.” In an opinion piece for The Washington Post published Tuesday titled “It’s time to call out Disney—and anyone else rich off their workers’ backs,” she wrote, quote, “I had to speak out about the naked indecency of chief executive Robert Iger’s pay. According to Equilar, Iger took home more than $65 million in 2018. That’s 1,424 times the median pay of a Disney worker. To put that gap in context, in 1978, the average CEO made about 30 times a typical worker’s salary. Since 1978, CEO pay has grown by 937 percent, while the pay of an average worker grew just 11.2 percent. This growth in inequality has affected every corner of American life.”

AMY GOODMAN: Those are the words of Abigail Disney. She went on to write, “At the pay levels we are talking about, an executive giving up half his bonus has zero effect on his quality of life. For the people at the bottom, it could mean a ticket out of poverty or debt. It could offer access to decent health care or an education for a child,” she wrote.

We spend the rest of the hour looking at inequality and the state of the economy with the Nobel Prize-winning economist Joseph Stiglitz, who served as chair of the Council of Economic Advisers under President Clinton. Joe Stiglitz is a professor at Columbia University, professor and chief economist for the Roosevelt Institute. His latest book is out this week: People, Power, and Profits: Progressive Capitalism for an Age of Discontent.

Joe Stiglitz, welcome back to Democracy Now! It’s great to have you with us. Why don’t you start off by talking about Abby Disney, what she had to say? She is the heiress of Disney, saying that Iger’s salary, the CEO, is “insane.”

JOSEPH STIGLITZ: She’s absolutely right. You mentioned that in the late '70s it was 30 to one, on average; today it's over 300 to one.And it’s not as if our CEOs have gotten 10 times as productive in those intervening years. It’s not as if—you know, American CEOs get paid so much more than their workers relative to those in Europe and even more relative to those in Japan. And it’s not because our CEOs are that much more productive. It’s because we have a real problem in our corporate governance laws, in our norms, that allow them to take away that much money.

And that money—you know, she points that it could have gone to—made a very big difference to workers. That money could also have gone into investment. You know, one of the striking things about the United States today is that while the rates of return are very, very high relative to what they’ve been in the past, the levels of investment have been low. So, you would have thought those two would have gone together, but with CEO pay and share buybacks being so large—trillion dollars of share buybacks last year—the money isn’t going either to workers or to investment.

JUAN GONZÁLEZ: And then, of course, you have to add the taxation policy, which is gradually protecting wealth rather than trying to create a level playing field, whether it’s with the elimination of the inheritance tax or the ending, effectively, of progressive taxation. That means that all that money that they get, they get to keep, as well, right?

JOSEPH STIGLITZ: Yeah. You know, this is a time where we—given the growth of inequality, you would have thought the natural response is to ramp up a progressivity of our tax system. And we’ve done just the opposite. The 2017 tax bill is a real illustration of that. It increased the tax rate on a majority of people in the second, third and fourth quintile. In other words, the vast middle class, when the bill is fully implemented, will see higher tax rates, in order to give a tax cut for billionaires.

Another way I put it as an economist, going back to your question about Abigail Disney, they talk about incentives. What kind of a CEO do you need to pay $60 million to get him off the golf course? You know, you don’t pay a surgeon who’s doing heart surgery, and say, “I’ll pay you a lot of money, provided I survive. But if I don’t, by the way, you don’t get anything.” Surgeons are professionals. They do all that they can to make sure that the surgery enables you to live. Our CEOs ought to be that kind of professional. And they used to be that kind of professional. They say, “My job, I’m trusted by my corporation to do the best I can for the corporation, and I’ll give it all. And you’re paying $5 million or $10 million to do that. That’s more than adequate.” And in other countries, people have that kind of sense of responsibility. But not, evidently, CEOs like that of Disney.

AMY GOODMAN: Joe, your book is titled People, Power, and Profits: Progressive Capitalism for an Age of Discontent. Should it be progressive capitalism or worker power? I mean, this is increasingly becoming the issue, when you have the top candidates and most popular political figures, like AOC, Alexandria Ocasio-Cortez, like Bernie Sanders, one of the top presidential contenders, proudly calling themselves Democratic Socialists.

JOSEPH STIGLITZ: Yeah. So, in those few words in the title, I try to pack an awful lot. So, one of the things I wanted to say is that any modern economy, the market is going to have to play an important role. So, that’s why I wanted to use the word “capitalism.” But I wanted to signal that the form of capitalism that we’ve seen over the last 40 years has not been working for most people. And that’s why I talk about people. We have to have progressive capitalism. We have to tame capitalism and redirect capitalism so it serves our society. You know, people are not supposed to serve the economy; the economy is supposed to serve our people.

The other word I talk about is “power.” Here, what I’m trying to capture is, there’s a real sense of powerlessness by a lot of Americans—powerlessness in the economy and powerlessness in our politics. It’s because of the increased concentration of market power in our economy, the growth of those monopolies, tech monopolies, monopolies in so many sectors, which is one of the factors that have contributed to all this inequality. But there’s also—

AMY GOODMAN: Hasn’t capitalism always done that?

JOSEPH STIGLITZ: Not to the extent that it has. You know, you can trace out the degree of monopoly power. And, yes, it was terrible at the end of the 19th century, and that’s why we passed anti-trust laws. And they worked for a while. We broke up Standard Oil. We broke up a lot of the other big monopolies. And then, around the middle of the 20th century, there was a set of ideas that were propagated byMilton Friedman at University of Chicago, that said, “The market is naturally competitive. Don’t worry about market power.” And that was just basically giving a blank check to the formation of more monopolies.

The idea that corporations will to try to exert that kind of exploitation for market power is an old one. Adam Smith talked about it. You know, he talked about this idea that the business leaders seldom get together, even for merriment, without getting a conspiracy against the general well-being. So, he was aware of it. But that’s why we passed laws to circumscribe it. And then we had this doctrine that says, “Don’t worry about it.” And now we see the consequences of not worrying about it. And it’s reached new, high peaks.

JUAN GONZÁLEZ: Well, I wanted to ask you about one section in your book where you’ve—and several of your articles—you’ve talked about China and what’s the economic model of China. In your book, you say, “For many of the billions in the developing world and emerging markets, China, using its distinctive [quote] 'socialist' market economy with Chinese characteristics, has provided a dynamic alternative vision to that of America, whose standing suffered a major blow with the 2008 crisis.” Now, China, to many folks, is basically a form of state capitalism, not really socialism, but state capitalism, yet it has had an enormous economic growth—7, 10% a year—and it’s raised hundreds of millions of people out of poverty.

JOSEPH STIGLITZ: About 740 million people out of poverty.

JUAN GONZÁLEZ: So, what does that say about the form of capitalism that we have in the United States, or even in Western Europe, that China is economically providing much more to its people these days than these systems are, in terms of where it came from?

JOSEPH STIGLITZ: Well, first, you have to remember they were catching up. And it proved to be an effective instrument for catching up. But there’s a price in terms of democracy. And I would have hoped that we would be a model, showing that you can have a kind of capitalism that actually works for people, the kind of progressive capitalism that I’ve been talking about, that can deliver growth, but not just for the 1% or one-tenth of 1%, but for the majority of our citizens.

JUAN GONZÁLEZ: But hasn’t the exacerbation of inequality—I go back to the collapse of the Soviet Union and the Soviet bloc. There were competing systems back then, and Western capitalism had to at least provide some benefits to its workers to prevent them from going toward socialism. With the collapse of the Soviet Union and the Eastern European countries, not only were new markets opened up for capitalism, but there was no longer a need to give any sops to the working class, as a result of the fact that there was no longer a competing system.

JOSEPH STIGLITZ: I think you’re absolutely right. And I think it’s one of the forces that have undermined the way our economic system has worked. We haven’t been challenged, to put it in a way. But we are being challenged now, because so many people have done so poorly.

AMY GOODMAN: And when you say “we,” you mean?

JOSEPH STIGLITZ: United States, we as a country, but also Western Europe. To put it, you know, another way, in the 1950s, we aspired to be the first middle-class society. And we talked about education for all. We had infrastructure investment. We had a tax rate at the top of 90%, and we had the fastest rate of growth that we’ve ever had.

AMY GOODMAN: We have to break. When we come back, we want to ask you about how healthcare for all, how canceling of student debt, pre-K, how all of these issues can be financed under progressive capitalism—all the issues that are being put forward by a few of the Democratic candidates right now. Joe Stiglitz, Nobel Prize-winning economist, with us. Stay with us.

...

[bernie clip w/ 3 amazing #'s]

https://www.democracynow.org/2019/4/24/joseph_stiglitz_elizabeth_warren_bernie_sanders

one of those viewers was Donald Trump, who targeted “Crazy Bernie” and “smiley and nice” Bret Baier in a critical early-morning tweet on Tuesday, calling the event “weird to watch.” big ratings?

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https://www.alternet.org/2019/04/us-billionaires-know-capitalism-is-broken-and-now-theyre-fearing-a-revolution/

The spate of far-left and far-right politicians being elected to office in the United States arguably speaks to a deep public distrust in how the political and economic system has failed average people, and focused all of its energy on the priorities and whims of a small class of billionaires.

A new deep dive by the Washington Post suggests that U.S. billionaires themselves are acutely aware of this divide — and are fearful that it could bring about the end, or at least the radical transformation, of American capitalism itself.

Tech billionaire Greg Larsen, for example, is reportedly worried that hot spots of business and investment like Silicon Valley are soaking up all the wealth. “It seems like every company in the world has to be here,” he said. “It’s just painfully obvious that the blob is getting bigger” — and he and Rep. Ro Khama (D-CA) fear this is politically unsustainable.

This sort of concentration makes American communities less livable — both communities that are being “left behind” with no jobs, and the communities like Silicon Valley that are gaining all the jobs only for the cost of living to skyrocket and become unaffordable for working people.

Nor is that the only potential issue. As technological capital increases and automation threatens huge segments of the economy, some entrepreneurs like OpenAI chairman Greg Brockman worry we may reach a point where human labor becomes unnecessary for the economy, and we may have to switch to a system where the government distributed profits directly to nonworkers through universal basic income for their survival.

Brockman compared it to the consumption of meat: “Once we have meat substitutes as good as the real thing, my expectation is that we’re going to look back at eating meat as this terrible, immoral thing,” he explained. Similarly, perhaps one day “we’ll look back and say, ‘Wow, that was so crazy and almost immoral that people were forced to go and labor in order to be able to survive.’”

All of this, however, is making billionaires like investor Seth Klarman uneasy. “I think we’re in the middle of a revolution — not a guns revolution — but a revolution where people on both extremes want to blow it up,” he suggested of politicians proposing huge transformations of the capitalist system like Sen. Elizabeth Warren (D-MA), “and good things don’t happen to the vast majority of the population in a revolution.”

see sys mic//PIC green new deal is systemic, intersectionality // occupy?

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aha? polarization // inequality?

https://www.salon.com/2016/10/01/breaking-point-america-approaching-a-period-of-disintegration-argues-anthropologist-peter-turchin/

As the 2016 campaign reaches fever pitch, the more heat there is and the less light is shed. Which is why evolutionary anthropologist Peter Turchin's new book comes as such a breath of fresh air. "Ages of Discord: A Structural-Demographic Analysis of American History" is not about this year's presidential election, per se, but it's a quantum leap forward in illuminating the disintegrative trends that America has experienced over the last several decades that are currently driving our politics.

Everything from skyrocketing inequality and political gridlock to white working class angst and the rise of mass shootings and other troubling signs of our times — these are all interconnected reflections of where America is in a cyclic historical process: social integration followed by disintegration, discord and violence. Turchin and others have observed this pattern repeatedly in civilizations from ancient Rome and early Chinese dynasties up to the present day.

....

corps can declare bank to cover their greed/screwups but student debt when we invest in ourselves are we are told we must, supports meritocracy story

https://www.alternet.org/2019/04/many-people-are-too-broke-for-bankruptcy-heres-what-congress-and-bankruptcy-organizations-could-do-to-help/

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AN 4/19

Next to Sen. Bernie Sanders, the most progressive Democratic candidate in the 2020 presidential race is arguably Sen. Elizabeth Warren of Massachusetts.

Warren is a details-obsessed policy wonk, outlining solution after solution for the United States. Yet her presidential campaign has been underperforming, especially in light of her strong track record. Warren, working with the Obama Administration, was instrumental in the creation of the Consumer Financial Protection Bureau in 2011— and after taking on incumbent Republican Sen. Scott Brown in 2012 and defeating him by 7%, she was reelected by 24% when she went up against Republican nominee Geoff Diehl in the 2018 midterms.

But while Warren raised $6 millionduring 2019’s first quarter, Sen. Bernie Sanders’ campaign had raised $18 million as of early April— and a Monmouth poll of Iowa voters, released April 11, found Warren enjoying 7% support compared to 16% for Sanders, 9% for South Bend, Indiana Mayor Pete Buttigieg and 27% for former Vice President Joe Biden (who hasn’t officially entered the race but will reportedly do so soon).

A variety of reasons have been offered for why Warren’s campaign hasn’t caught fire so far, ranging from sexism to President Donald Trump’s childish “Pocahontas” taunts to claims that while she is great at policy recommendations, Warren isn’t great at soundbites or reaching Americans with short attention spans. Regardless, Warren is a wealth of powerful and important ideas.

Here are six of the many areas in which the Massachusetts senator has excelled from a policy standpoint.

1. Warren realizes that gaping wealth inequality is terrible for free-market capitalism

Sanders and Warren part company when it comes to describing themselves. Sanders considers himself a “democratic socialist,” while Warren has said that she is a “capitalist to my bones.” But the New England senators agree that gaping wealth inequality is terrible for the U.S., and Warren—much like President Franklin Delano Roosevelt in the 1930s/early 1940s and President Lyndon B. Johnson in the 1960s—realizes that capitalism is best served by a strong middle class. Warren recently told Bloomberg TV, “Washington is broken, and right now, it works great if you’re a billionaire. It works great if you are a giant multinational corporation. It works great for the wealthy and the well-connected, and it is not working for the rest of America.”

2. Warren understands that the U.S. tax system is rigged in favor of the 1%

The ultra-wealthy, Warren stressed to Bloomberg TV, have successfully rigged the U.S. tax system to their advantage—and the wealthiest Americans need to pay their fair share of taxes “so that we can make investments so that Washington works, government works to create opportunities for everybody else.” The U.S., Warren stressed, needs to “make democracy work better so that we make this economy work better. You were successful—God bless. But part of the deal is that you pay back so that the next kid gets a chance to be successful.”

3. Warren favors a wealth tax on the richest Americans

Like Sanders, Warren realizes that taxing the wealthiest Americans isn’t about punishing affluence (as the right often claims) but leveling the financial playing field. The Washington Post, on January 24, reported that Warren had been seeking advice on a wealth tax from liberal University of Berkeley economist Emmanuel Saez—who proposed a 2% wealth tax on Americans with asserts above $50 million and a $3 wealth tax on Americans with assets above $1 billion.

4. Warren proposes breaking up the United States’ largest banks

The Great Recession was the worst financial crisis in the U.S. since the Great Depression, and Warren—not unlike Sanders—has stressed that in order to avoid another financial calamity, it is essential to break up the country’s largest banks into a bunch of smaller banks. Warren understands that competition is necessary to promote free-market capitalism rather than crony capitalism, and breaking up banks is one way to force competition. The Massachusetts senator has also proposed a 21^st Century version of the Glass-Steagall Act, which mandated a separation of commercial and investment banking as part of FDR’s New Deal in the 1930s but was repealed in the 1990s.

5. Warren stresses that increasing the minimum wage is vital to having a strong middle class

When a federal minimum wage was first enacted as part of FDR’s New Deal in the 1930s, the idea wasn’t that a corporate CEO and an entry-level worker were supposed to earn the same amount of money, but that minimum wage workers should at least be able to stay afloat financially. But the United States’ stagnant minimum wage, last raised in 2009, hasn’t begun to keep up with inflation. In January, the 69-year-old Warren told reporters, “When I was a kid, a minimum wage job in America would support a family of three. It would pay a mortgage, keep the utilities on and put food on the table. Today, a minimum wage job in America will not keep a mama and a baby out of poverty.”

6. Warren views universal health care as essential to a healthy economy

Calling for universal health care is something that the centrist and liberal/progressive 2020 Democratic presidential candidates have in common, but how they hope to achieve it varies. Minnesota Sen. Amy Klobuchar, one of the most centrist of the Democratic hopefuls, has said she favors expanding the Affordable Care Act of 2010, also known as Obamacare, and is open to creating a public insurance option for health care. But Klobuchar opposes a Medicare-for-all plan, unlike Sanders. Warren, meanwhile, recently told Bloomberg TV that she has “signed onto Medicare for All” as well as another plan “that gives an option for buying in to Medicaid.” The “key,” Warren has stressed, is to “always keep the center of the bullseye in mind, and that is affordable health care for every American.”

richard wolff in passing: IQ /st'd test merely reflect books and other educ experiences, so meritocricy is a scam/lie, privileged self-perpetuates (amplify/matthew eft?

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https://www.commondreams.org/news/2019/04/11/bolstered-trump-tax-scam-number-us-corporations-paying-not-dime-federal-taxes

no pix (famous post card for tax return]

no lnx

Bolstered by Trump Tax Scam, Number of US Corporations Paying 'Not a Dime' in Federal Taxes Doubled in 2018

"Corporations zeroing out their tax bills or paying single-digit federal tax rates mean a substantial loss in federal revenue. Calls to cut critical programs and services in the wake of these corporate tax cuts are absolutely connected."

byEoin Higgins, staff writer

17 Comments

In 2017, House Ways and Means Committee Chairman Kevin Brady (R-Tex.), joined by House Speaker Paul D. Ryan (R-Wis), right, holds a proposed "postcard tax filing form" as they unveiled the GOP’s far-reaching tax overhaul bill. (Photo: J. Scott Applewhite/AP) [intuit lobby killed free tax prep/simpl, support grover]

A new analysis out Thursday shows that tax policy under the Trump administration is benefitting large corporations to such a degree that twice as many large companies will pay nothing in federal taxes for 2018 compared to previous years.

The report by the Institute on Taxation and Economic Policy, which comes less than a week before tax day in the United States on April 15, found that 60 companies—including Amazon, Netflix, Activision Blizzard, General Motors, and IBM—used "a diverse array of legal tax breaks" to bring their federal tax liability to zero.

"For years, corporations have manipulated the system to avoid paying taxes, and it's clear that the 2017 tax law did nothing to change this," said Matthew Gardner, a senior fellow at ITEP and lead author of the report.

See the complete list of U.S. companies which paid "not a dime" in federal taxes last year here.

"In many cases, American taxpayers are subsidizing THEM," writer David Beard noted on Twitter.

As IETP said in a statement announcing the study's results:

The tax-avoiding corporations are some of the most profitable, recognizable companies in the world, and they represent a variety of industries, including technology, energy and gas, financial services, aviation, pharmaceutical and manufacturing. Earlier this year, ITEP reported Netflix and Amazon paid no federal taxes. Other companies on this list include Chevron, Delta Airlines, Eli Lilly, General Motors, Gannett, Goodyear Tire and Rubber, Halliburton, IBM, Jetblue Airways, Principal Financial, Salesforce.com, US Steel, and Whirlpool.

These companies avoided taxes by employing a variety of legal tax breaks. Accelerated depreciation allows companies to write off the cost of their investments much faster than these investments wear out. This break accounted for hundreds of millions in tax write-offs. Chevron alone, for example, reported $290 million in accelerated depreciation, and Halliburton reported $320 million.

According to the institute, U.S. lawmakers "interested in enacting true tax reform should critically assess the costs of each of existing tax break—including those discussed in this report—and take steps to ensure that profitable corporations pay their fair share of U.S. taxes."

:{:{}:

One of those lawmakers is Sen. Elizabeth Warren (D-Mass.)—a Democratic presidential candidate for the 2020 election—who on Thursday released her Real Corporate Profits Tax bill. The proposed legislation would impose a flat 7 percent tax on American corporations with profits over $100 million,as Common Dreams reported.

"Some of the biggest corporations in the country make huge profits but pay zero federal corporate income taxes on those profits," Warren said in a Medium post explaining the bill.

Gardner explained to the Center for Public Integrity and NBC News that the Trump tax cuts in 2017—which dropped the corporate tax rate from 35% to 21%—are the main driver behind both the reduction in corporate taxes for 2018 and the increase in companies paying nothing.

"The specter of big corporations avoiding all income taxes on billions in profits sends a strong and corrosive signal to Americans," said Gardner, "that the tax system is stacked against them, in favor of corporations and the wealthiest Americans."

Still, the money has to go somewhere. Adam Smith, a campaign finance advocate, had an idea of where that he shared on Twitter.

"I wonder how many lobbyists these companies pay for each year," said Smith.

What's clear to Gardner is that the loss of federal revenue is not without far-reaching repercussions.

"We cannot pretend that corporate tax avoidance has no cost," said Gardner. "Corporations zeroing out their tax bills or paying single-digit federal tax rates mean a substantial loss in federal revenue. Calls to cut critical programs and services in the wake of these corporate tax cuts are absolutely connected."

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https://www.alternet.org/2019/04/the-irs-tried-to-go-after-the-ultra-rich-with-audits-from-hell-until-congress-stepped-in-to-protect-the-wealthy/

very long

On June 30, 2016, an auto-parts magnate received the kind of news anyone would dread: The Internal Revenue Service had determined he had engaged in abusive tax maneuvers. He stood accused of masking about $5 billion in income. The IRS wanted over $1.2 billion in back taxes and penalties.

The magnate, Georg Schaeffler, was the billionaire scion of a family-owned German manufacturer and was quietly working as a corporate lawyer in Dallas. Schaeffler had extra reason to fear the IRS, it seemed. He wasn’t in the sights of just any division of the agency but the equivalent of its SEAL Team 6.

In 2009, the IRS had formed a crack team of specialists to unravel the tax dodges of the ultrawealthy. In an age of widening inequality, with a concentration of wealth not seen since the Gilded Age, the rich were evading taxes through ever more sophisticated maneuvers. The IRS commissioner aimed to stanch the country’s losses with what he proclaimed would be “a game-changing strategy.” In short order, Charles Rettig, then a high-powered tax lawyer and today President Donald Trump’s IRS commissioner, warned that the squad was conducting “the audits from hell.” If Trump were being audited, Rettig wrote during the presidential campaign, this is the elite team that would do it.

The wealth team embarked on a contentious audit of Schaeffler in 2012, eventually determining that he owed about $1.2 billion in unpaid taxes and penalties. But after seven years of grinding bureaucratic combat, the IRS abandoned its campaign. The agency informed Schaeffler’s lawyers it was willing to accept just tens of millions, according to a person familiar with the audit.

How did a case that consumed so many years of effort, with a team of its finest experts working on a signature mission, produce such a piddling result for the IRS? The Schaeffler case offers a rare window into just how challenging it is to take on the ultrawealthy. For starters, they can devote seemingly limitless resources to hiring the best legal and accounting talent. Such taxpayers tend not to steamroll tax laws; they employ complex, highly refined strategies that seek to stretch the tax code to their advantage. It can take years for IRS investigators just to understand a transaction and deem it to be a violation.

Once that happens, the IRS team has to contend with battalions of high-priced lawyers and accountants that often outnumber and outgun even the agency’s elite SWAT team.“We are nowhere near a circumstance where the IRS could launch the types of audits we need to tackle sophisticated taxpayers in a complicated world,” said Steven Rosenthal, who used to represent wealthy taxpayers and is now a senior fellow at the Tax Policy Center, a joint venture of the Urban Institute and Brookings Institution.

Because the audits are private — IRS officials can go to prison if they divulge taxpayer information — details of the often epic paper battles between the rich and the tax collectors are sparse, with little in the public record. Attorneys are also loath to talk about their clients’ taxes, and most wealthy people strive to keep their financial affairs under wraps. Such disputesalmost always settle out of court.

But ProPublica was able to reconstruct the key points in the Schaeffler case. The billionaire’s lawyers and accountants first crafted a transaction of unusual complexity, one so novel that they acknowledged, even as they planned it, that it was likely to be challenged by the IRS. Then Schaeffler deployed teams of professionals to battle the IRS on multiple fronts. They denied that he owed any money, arguing the agency fundamentally misunderstood the tax issues. Schaeffler’s representatives complained to top officials at the agency; they challenged document requests in court. At various times, IRS auditors felt Schaeffler’s side was purposely stalling. But in the end, Schaeffler’s team emerged almost completely victorious.

His experience was telling. The IRS’ new approach to taking on the superwealthy has been stymied. The wealthy’s lobbyists immediately pushed to defang the new team. And soon after the group was formed, Republicans in Congress began slashing the agency’s budget. As a result, the team didn’t receive the resources it was promised. Thousands of IRS employees left from every corner of the agency, especially ones with expertise in complex audits, the kinds of specialists the agency hoped would staff the new elite unit. The agency had planned to assign 242 examiners to the group by 2012, according to a report by the IRS’ inspector general. But by 2014, it had only 96 auditors. By last year, the number had fallen to 58.

The wealth squad never came close to having the impact its proponents envisaged. As Robert Gardner, a 39-year veteran of the IRS who often interacted with the team as a top official at the agency’s tax whistleblower office, put it, “From the minute it went live, it was dead on arrival.”

Most people picture IRS officials as all-knowing and fearsome. But when it comes to understanding how the superwealthy move their money around, IRS auditors historically have been more like high school physics teachers trying to operate the Large Hadron Collider.

That began to change in the early 2000s, after Congress and the agency uncovered widespread use of abusive tax shelters by the rich. The discovery led to criminal charges, and settlements by major accounting firms. By the end of the decade, the IRS had determined that millions of Americans had secret bank accounts abroad. The agency managed to crack open Switzerland’s banking secrecy, and it recouped billions in lost tax revenue.

The IRS came to realize it was not properly auditing the ultrawealthy. Multimillionaires frequently don’t have easily visible income. They often have trusts, foundations, limited liability companies, complex partnerships and overseas operations, all woven together to lower their tax bills. When IRS auditors examined their finances, they typically looked narrowly. They might scrutinize just one return for one entity and examine, say, a year’s gifts or income.

Belatedly attempting to confront improper tax avoidance, the IRS formed what was officially called the Global High Wealth Industry Group in 2009. “The genesis was: If you think of an incredibly wealthy family, their web of entities somehow gives them a remarkably low effective tax rate,” said former IRS Commissioner Steven Miller, who was one of those responsible for creating the wealth squad. “We hadn’t really been looking at it all together, and shame on us.”

The IRS located the group within the division that audits the biggest companies in recognition of the fact that the finances of the 1 percent resemble those of multinational corporations more than those of the average rich person.

The vision was clear, as Doug Shulman, a George W. Bush appointee who remained to helm the agency under the Obama administration, explained in a 2009 speech: “We want to better understand the entire economic picture of the enterprise controlled by the wealthy individual.”

It’s particularly important to audit the wealthy well, and not simply because that’s where the money is. That’s where the cheating is, too. Studies show that the wealthiest are more likely to avoid paying taxes. The top 0.5 percent in income account for fully a fifth of all the underreported income, according to a 2010 study by the IRS’ Andrew Johns and the University of Michigan’s Joel Slemrod. Adjusted for inflation, that’s more than $50 billion each year in unpaid taxes.

The plans for the wealth squad seemed like a step forward. In a few years, the group would be staffed with several hundred auditors. A team of examiners would tackle each audit, not just one or two agents, as was more typical in the past. The new group would draw from the IRS’ best of the best.

That was crucial because IRS auditors have a long-standing reputation, at least among the practitioners who represent deep-pocketed taxpayers, as hapless and overmatched. The agents can fritter away years, tax lawyers say, auditing transactions they don’t grasp. “In private practice, we played whack-a-mole,” said Rosenthal, of the Tax Policy Center. “The IRS felt a transaction was suspect but couldn’t figure out why, so it would raise an issue and we’d whack it and they would raise another and we’d whack it. The IRS was ill-equipped.”

The Global High Wealth Group was supposed to change that. Indeed, with all the fanfare at the outset, tax practitioners began to worry on behalf of their clientele. “The impression was it was all going to be specialists in fields, highly trained. The IRS would assemble teams with the exact right expertise to target these issues,” Chicago-based tax attorney Jenny Johnson said.

The new group’s first moves spurred resistance. The team sent wide-ranging requests for information seeking details about their targets’ entire empires. Taxpayers with more than $10 million in income or assets received a dozen pages of initial requests, with the promise of many more to follow. The agency sought years of details on every entity it could tie to the subject of the audits.

In past audits, that initial overture had been limited to one or two pages, with narrowly tailored requests. Here, a typical request sought information on a vast array of issues. One example: a list of any U.S. or foreign entity in which the taxpayer held an “at least a 20 percent” interest, including any “hybrid instruments” that could be turned into a 20 percent or more ownership share. The taxpayer would then have to identify “each and every current and former officer, trustee, and manager” from the entity’s inception.

Taxpayers who received such requests recoiled. Attacking the core idea that Shulman had said would animate the audits, their attorneys and accountants argued the examinations sought too much information, creating an onerous burden. The audits “proceeded into a proctology exam, unearthing every aspect of their lives,” said Mark Allison, a prominent tax attorney for Caplin & Drysdale who has represented taxpayers undergoing Global High Wealth audits. “It was extraordinarily intrusive. Not surprisingly, these people tend to be private and are not used to sharing.”

Tax practitioners took their concerns directly to the agency, at American Bar Association conferences and during the ABA’s regular private meetings with top IRS officials. “Part of our approach was to have private sit-downs to raise issues and concerns,” said Allison, who has served in top roles in the ABA’s tax division for years. We were “telling them this was too much, unwieldy and therefore unfair.” Allison said he told high-ranking IRS officials, “You need to rein in these audit teams.”

For years, politicians have hammered the IRS for its supposed abuse of taxpayers. Congress created a “Taxpayer Bill of Rights” in the mid-1990s. Today, the IRS often refers to its work as “customer service.” One result of constant congressional scrutiny is that senior IRS officials are willing to meet with top tax lawyers and address their concerns. “There was help there. They stuck their necks out for me,” Allison said.

The IRS publicly retreated. Speaking at a Washington, D.C., Bar Association event in February 2013, a top IRS official, James Fee, conceded the demands were too detailed and long, telling the gathering that the agency has “taken strides to make sure it doesn’t happen again.” The Global High Wealth group began to limit its initial document requests.

The lobbying campaign, combined with the lack of funding for the group, took its toll. One report estimated that the wealth team had audited only around a dozen wealthy taxpayers in its first two and a half years. In a September 2015 report, the IRS’ inspector general said the agency had failed to establish the team as a “standalone” group “capable of conducting all of its own examinations.” The group didn’t have steady leadership, with three directors in its first five years. When it did audit the ultrawealthy, more than 40 percent the reviews resulted in no additional taxes.

The inspector general also criticized the IRS broadly — not just its high-wealth team — for not focusing enough on the richest taxpayers. In 2010, the IRS as a whole audited over 32,000 millionaires. By 2018, that number had fallen to just over 16,000, according to data compiled by Syracuse University. Audits of the wealthiest Americans have collapsed 52 percent since 2011, falling more substantially than audits of the middle class and the poor. Almost half of audits of the wealthy were of taxpayers making $200,000 to $399,000. Those audits brought in $605 per audit hour worked. Exams of those making over $5 million, by contrast, brought in more than $4,500 an hour.

The IRS didn’t even have the resources to pursue millionaires who had been hit with a hefty tax bill and simply stiffed Uncle Sam. It “appeared to no longer emphasize the collection of delinquent accounts of global high wealth taxpayers,” a 2017 inspector general report said.

In recent years, the number of Global High Wealth audits has been higher — it closed 149 audits in the last year — but tax lawyers and former IRS officials say even that improvement is deceptive. A major reason is that the audits are much less ambitious. “They were longer at the beginning and shorter as the process moved on,” Johnson, the tax attorney, said.....much more

The college admissions cheating scandal has outraged millions, bringing to light the gaps between the privileged and less privileged citizens. Being a social scientist who studies societal origins of economic and health inequalities, it was clear to me that it was a manifestation of deep structural inequalities in the U.S. social hierarchy. Such structural inequalities appear in various forms, including wealth and health inequalities.

But just what do “structural inequalities” mean?

They are inequalities deeply woven into the very fabric of a society. They can be observed across institutions such as legal, educational, business, government and health care systems. Inequalities occur because of an imbalance in the distribution of political and economic power. While one group has historically set the rules and writes the law of the land, access of others to wealth and resources have been limited.

Blacks, for example, have been historically denied access to well-paying jobs, entrance into elite educational institutions, and wealthy neighborhoods. At the same time, whites have accumulated wealth, education and prestigious jobs that were systemically blocked for blacks. Such societal functions sometimes continue for centuries, with strong structures being built, reinforcing political and economic power.

As an assistant professor of psychiatry at the University of Michigan and a faculty member at Charles R. Drew University of Medicine and Sciences, I have conducted several studies on how social factors such as race and class shape access to economic and health outcomes. My studies have shown that as a result of such structural inequalities, the very same economic resources consistently generate better outcomes for the privileged group.

My studies have established that unjust social structures hinder non-whites, particularly blacks, who have been historically marginalized. Many in the U.S. want to believe that people can pull themselves up by their bootstraps. I believe that the naked truth, however, is that there are powerful unjust social systems in place, operating for centuries, that help some but hurt many.

Privilege builds power

Historical patterns affect structure in many ways. For example, it gives those with money and inherited wealth a head start. Those whose families have had money for decades or centuries have far more access to good education and first-rate health care.

Those who have been discriminated against, particularly blacks, are far less likely to have that same access or even the ability to catch up. In addition, my studies have suggested that even when blacks do achieve wealth and high education, their health still suffers.

When black men become successful, they will pay for the rest of their life some health consequences. It is due to such injustice that social networks disproportionately help the privileged group.

Structural inequalities upset many Americans’ sense of justice. But worse, these inequalities actually make many people sick.

The harmful effect of inequality is not just because of being at a lower status. Even just being aware of it can make a person sick, some studies suggest. Seeing the world as an unfair place is a risk factor in itself for poor health.

A chance to cheat

In addition to the higher wealth of the individuals involved in the admissions cheating scandal, unjust social structure has played a role in giving the privileged an opportunity to cheat. It is not all about the cheater. The cheating-friendly context enables the cheater to cheat.

Those with money, access and fame are generally favored by society, giving them extremely high levels of access to social power, resources and networking.

In many countries, particularly the U.S., this system of privilege has been historically attached to skin color and other social identities such as race and class. The most common race involved in the college admissions scandal incident was white, the highest privileged race.

Research has well documented the “large and persistent” inequalities between social groups in the U.S. While the U.S. as a whole is the wealthiest country in the world, it is also one of the most unequal ones.

As there are more and more opportunities open for the “haves” than the “have-nots,” without any ill intention, the gap in society becomes larger and larger as the U.S. becomes a wealthier country. This is inevitable unless we find a policy solution for it.

I hope this discussion can help bring understanding about why, without ill intentions, structural inequalities generate gaps across social groups. Social privilege is not a myth. It is real and consequential. It is up to us, the American society, to demand equity, and fight societal and structural malady.

the conver

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world pol dynasty nepotism

https://www.alternet.org/2019/03/want-to-get-into-politics-in-2019-it-still-helps-if-you-come-from-the-right-family/

bribes cheat dirty tricks extend to the oligarchs, corruption

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https://www.democracynow.org/2019/3/13/cheating_bribes_lies_doj_charges_dozens

Operation Varsity Blues. That’s the name of a sweeping federal probe into what the Justice Department calls the biggest college admissions scam the agency has ever uncovered. On Tuesday, 50 people, including 13 college coaches, were arrested for taking part in a scheme where wealthy parents paid exorbitant bribes to secure spots for their unqualified children in elite schools, including Yale, Stanford, Georgetown, UCLA, USC and Wake Forest. Prosecutors have charged 33 parents, including Hollywood stars Felicity Huffman and Lori Loughlin; Loughlin’s husband, the fashion designer Mossimo Giannulli; and Bill McGlashan, a founder of TPG Capital, one of the largest private equity investment firms in the world. We speak with Ivory Toldson, professor of counseling psychology at Howard University and president of Quality Education for Minorities. His new book is titled “No BS (Bad Stats): Black People Need People Who Believe in Black People Enough Not to Believe Every Bad Thing They Hear About Black People.”

....

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GOODMAN: So, that’s the FBI special agent talking about this scandal. No actual schools were charged, though people within the schools, like, you know, the head of soccer at Yale, for example. You had these pictures sent in of athletes with their heads photoshopped to be a student who didn’t even play the particular game, in cases like water polo. What message does this scandal send to black and brown children, to white not wealthy children, who believe that higher education is a meritocracy? What do you say to them?

IVORY TOLDSON: Yeah, yeah. Well, I hope it’s a wake-up call for people who have bought into the system that people become wealthy because they have worked hard. It’s a deception that’s pervasive in our society. Among the wealthy, their objective is passive income. You know, they talk actively about making money without working. That’s what they talk about in their own social networks. But yet, when they’re talking to people who may work for them, they try to make it seem like it’s all about working hard. In reality, it should be about working hard. Everybody should work hard for what they have. But there are people in this country, unfortunately, who would rather manipulate the system so that some people work hard to get enough, and other people work not at all and get more.

And I think it also does a disservice to their children, because their children will grow up feeling a false sense of entitlement, believing in unearned privilege, believing in inherited wealth and all of the things that will lead to certain types of predatory behaviors, whether it be predatory lending, manipulating markets, predatory landlords—you know, different aspects of society that we’ve all grown to loathe. All of this is cultivated in these types of environments.

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https://www.alternet.org/2019/02/richest-0-00025-percent-now-owns-more-wealth-than-bottom-150-million-americans-study/

Richest 0.00025 percent now owns more wealth than bottom 150 million Americans: study

As survey data continues to show that raising taxes on the wealthy is extremely popular among the U.S. public, new research by inequality expert and University of California, Berkeley economist Gabriel Zucman found that the richest 0.00025 percent of the American population now owns more wealth than the 150 million adults in the bottom 60 percent.

Zucman, who helped Sen. Elizabeth Warren (D-Mass.) develop her “Ultra-Millionaire Tax” proposal, observed in a working paper (pdf) that “U.S. wealth concentration seems to have returned to levels last seen during the Roaring Twenties.”

According to Zucman’s research, the richest 0.00025 percent—just 400 Americans—have seen their share of America’s national wealth triple since the 1980s, while the wealth of much of the U.S. population has stagnated or declined.

[useful chart]

as the Washington Post’s Christopher Ingraham noted in a breakdown of Zucman’s research, adults in the bottom 60 percent of the wealth distribution “saw their share of the nation’s wealth fall from 5.7 percent in 1987 to 2.1 percent in 2014.”

Consolidation of wealth at the very top, Ingraham observes, “is eroding security from families in the lower and middle classes, who rely on their small stores of wealth to finance their retirement and to smooth over economic shocks like the loss of a job. And it’s consolidating power in the hands of the nation’s billionaires, who are increasingly using their riches to purchase political influence.”

Zucman’s research comes as members of Congress and 2020 presidential candidates are pushing a variety of plans to begin reducing America’s staggering wealth and income inequality by raising taxes on those at the very top.

Sen. Elizabeth Warren (D-Mass.), who officially launched her 2020 presidential campaign on Saturday, has proposed an annual tax of two percent on assets over $50 million.

Last month, Sen. Bernie Sanders (I-Vt.)—who is reportedly close to announcing his 2020 candidacy—introduced the the For the 99.8% Act, which would establish a 77 percent tax on all estates over $1 billion.

And Rep. Alexandria Ocasio-Cortez (D-N.Y.) has suggested imposing a top marginal tax rate of 70 percent on those who make over $10 million.

Pointing to polling data showing that 76 percent of Americans believe the rich should pay more in taxes, Indivisible’s Chad Bolt concluded: “Raising taxes on the wealthy isn’t just good policy. It’s also good politics.”

aha all bktv and kpfa say same

https://kpfa.org/episode/against-the-grain-february-11-2019/

It’s self-evident that unequal societies like ours are bad for the poor. However, as epidemiologist Richard Wilkinson argues, they’re also bad for everyone else, including the affluent, not only because inequality affects schools and healthcare, but because it also makes us anxious and unhappy. Wilkinson reflects on our psychological well-being in wealthy but unequal countries.

Resources:

Richard Wilkinson and Kate Pickett, The Inner Level: How More Equal Societies Reduce Stress, Restore Sanity and Improve Everyone’s Well-Being Penguin, 2019

https://www.alternet.org/2019/01/watch-this-historian-call-out-davos-elite-to-their-faces-stop-talking-about-philanthropy-and-pay-higher-taxes/

While the private jets have mostly left the airport outside of Davos, Switzerland following the conclusion of this year’s World Economic Forum, a little noticed exchange that took place during the annual gathering has picked up steam in recent days showing what it looks like when some of the world’s richest people are confronted by someone willing to call literal “bullshit” on the we-can-save-the-world-with-charity mantra that dominates among the global elite.

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If the world’s richest and most powerful are worried about a so-called popular “backlash” in response to the global economic system they defend—and largely control—Rutger Berman, a Dutch historian and author of the book Utopia for Realists, during a panel last week titled “The Cost of Inequality,” said the pathway is not complicated. “The answer,” he said, “is very simple: Just stop talking about philanthropy, and start talking about taxes.”

“I mean we can talk for a very long time about all these stupid philanthropy schemes,” Bregman added. “We can invite [U2 frontman] Bono once more. But, come on, we’ve got to be talking about taxes. That’s it. Taxes, taxes, taxes. All the rest is bullshit in my opinion.”

Watch the following clip put out by Now This:

Embedded video

NowThis

@nowthisnews

‘It feels like I’m at a firefighters conference and no one’s allowed to speak about water.’ — This historian wasn’t afraid to confront the billionaires at Davos about their greed

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4:33 PM - Jan 28, 2019

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Also on the Davos panel with Bregman was Winnie Byanyima, executive director of Oxfam International. Just last week, as the WEF summit was just opening, Oxfam released a report on global inequality showing that just26 billionaires now own as much wealth as the world’s 3.8 poorest billion people.

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“We have a tax system that leaks so much, that allows $170 billion of money every year to be taken to tax havens and to be denied the developing countries that need that money most,” said Byanyima during the panel. “So we have to look at the business model, and we have to look at the role of governments to tax and plow back money into people’s lives.”

As the video clip began to go viral in the wake of the Davos’ gathering, the media team for Sen. Bernie Sanders (I-Vt.)—who has continued to put global inequality and the idea of a “rigged” economy at the heart of his political message—snagged the central claims of Bregman’s remarks and on Tuesday put out this version:

Embedded video

Bernie Sanders

@SenSanders

We have a rigged tax code that has essentially legalized tax-dodging for large corporations and the world's wealthiest individuals. It is time to end these egregious loopholes and make the wealthy pay their fair share.

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12:18 PM - Jan 29, 2019

4,349 people are talking about this

Twitter Ads info and privacy

“We have a rigged tax code that has essentially legalized tax-dodging for large corporations and the world’s wealthiest individuals,” said Sanders. “It is time to end these egregious loopholes and make the wealthy pay their fair share.”

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https://en.wikipedia.org/wiki/Rutger_Bregman

Rutger C. Bregman (born 1988) is a Dutch historian and author. He has published four books on history, philosophy and economics, including Utopia for Realists: How We Can Build the Ideal World, which has been translated into twenty languages. The Dutch edition of Utopia for Realists "became a national bestseller and sparked a basic income movement that soon made international headlines." His work has been featured in The Washington Post, The Guardian and the BBC. He has been described by The Guardian as the "Dutch wunderkind of new ideas."^[1] and by Ted Talks as "one of Europe's most prominent young thinkers." His TED Talk, Poverty isn't a lack of character; it's a lack of cash, was listed as one of the top ten of 2017.

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//AOC 70% tax bracket?

Elizabeth Warren proposes ‘Ultra-Millionaire Tax’ for anyone with over $50 million in assets

Julia Conley / Common Dreams

The annual confab of the captains of global industry, finance, and wealth is underway in Davos, Switzerland at the World Economic Forum.

Meanwhile, Oxfam reports that the wealth of the 2,200 billionaires across the globe increased by $900 billion last year – or $2.5 billion a day. Their 12 percent increase in wealth contrasts with a drop of 11 percent in the wealth of the bottom half of the people of the world. In fact, the world’s 26 richest billionaires now own as much as the 3.8 billion who comprise the bottom half of the planet’s population.

SPONSORED

Billionaires Club

The World Economic Forum slips into liberal language, reflecting concern for the deep disparities in the world and the crises of war and climate change. It is impossible to ignore fully the calamities in our world. They have to make a show of taking these things seriously.

There are currently 2,208 billionaires in the world, twice the number since the global financial crisis of 2007-08. Most of them are from North America and Europe. They currently have more wealth than ever before, according to a new report from Oxfam International. The combined wealth of the richest 26 among these 2,208 billionaires reached US$1.4 trillion. This amount of wealth is equivalent to the total wealth of the planet’s 3.8 billion poorest people. That means that only 26 individuals have as much wealth as 3.8 billion people. Let that sink in.

Who are these 26 men and women? The top ten of them are Jeff Bezos (Amazon), Bill Gates (Microsoft), Warren Buffett (Berkshire Hathaway), Bernard Arnault (LVMH), Mark Zuckerberg (Facebook), Amancio Ortega (Zara), Carlos Slim Helu (America Movil), the Koch Brothers (Koch Industries) and Larry Ellison (Oracle). On this list, only one person—Carlos Slim Helu—is neither European nor North American. He is Mexican. Further down the list is one Indian (Mukesh Ambani) and several Chinese billionaires (Ma Huateng, Jack Ma, Li Ka-shing, Hui Ka Yan, Lee Shau-kee and Wang Jianlin).

It is not that these men—and a few women—work so hard that they earn their wealth. Most of them inherited their wealth; others were able to get their hands on public assets at fire-sale prices during the time of privatization. Meanwhile, hundreds of millions of women in working-class and middle-class households do millions of hours of unpaid labor to maintain a system that has cut social safety nets and social welfare. The Oxfam report has a startling piece of data. “If all the unpaid care work done by women across the globe was carried out by a single company, it would have an annual income of $10 trillion—43 times that of Apple.” And yet, it is people who own Apple and its kindred firms who make the billions while these women earn nothing. This is the actual structural crisis that will not be discussed at Davos. It goes against the interests of the billionaires to open this conversation.

Libyan Beach

A few days ago, an inflatable dingy sunk off the Libyan coast. It was carrying at least 120 migrants. Three of them survived. They were brought to the Italian island of Lampedusa, where they said that the boat carried people from West Africa and Sudan. There were children on board, and one pregnant woman. The men who survived came from Sudan and Gambia.

The International Organization for Migration (IOM) counts the number of people who attempt to cross the Mediterranean Sea. It says that in the first 16 days of 2019, 4,216 people attempted the crossing as compared to 2,365 in the same period last year. Thus far, 200 migrants have already died in these perilous waters. Italy’s far-right government has been arresting those migrants who make it to Europe and taking them back to Libya. There is as yet no count of how many of these migrants go back to the boats and try to make the passage again.

It is estimated that close to a million migrants are amassed in Libya, some in concentration camps, hoping to make it to Europe. They mainly come from Bangladesh, Egypt, Mali, Niger, Nigeria, Pakistan, Sudan and Syria. What brings them to Libya, even as they hear stories in their homelands of the dangers of this journey? Many come because war has torn their country apart—wars in Sudan and Syria as cases in point. But the rest come because of the harshness of their lives, the impossibility of making a living where they continue to work but their work only fattens the bank accounts of the few.

Most of the migrants are economic refugees, people who work hard but starve and dream of a better life anywhere else. Policies that would help them at home—such as an increase in social welfare, universal health care and universal education—are denied. The rich no longer want to pay taxes, which is what increases the wealth of the few and prevents even sympathetic states from offering a wide social democratic agenda. The rich also hide roughly US$7.6 trillion from tax authorities, money secured in tax havens that could provide the finances necessary to improve the lives of people where they live.

Davos Man will smile at the World Economic Forum and talk at length about the need for “reform” and to tackle the “challenges” in the world. But, at the same time, Davos Man will fight hard to protect the wealth that has been secreted away, wealth that people created, and that people are now denied.

There is a direct line between the increased wealth of the billionaires and the increased number of migrants who want to cross the Mediterranean. One lot flies into Davos in their private jets, while the other sits in sinking rubber boats in the sea.

This article was produced by Globetrotter, a project of the Independent Media Institute.

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https://www.alternet.org/2019/01/reality-is-starting-to-creep-into-the-billionaire-oasis-of-davos/

https://www.alternet.org/2019/01/how-unchecked-capitalism-and-massive-inequality-made-america-bully-nation/

labor history

WITH pod tradewatch public citizen 3 lawyer bd out of nafta 2?

boost inequality, wages down Mex 3%, flat in US

OMG evil sorta, the tookl to equalize is going after poor and ignoring rich and corps

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https://www.democracynow.org/2019/1/14/as_govt_shutdown_drags_on_irs

EIC audits up (1/3) because automated, but rich ppl have complex taxes that take human power, so rates dropping

also large corps not audited much anymore

corn booktv in depth 1/19

BO tried to let bush tax cuts expire for rich but not MC?

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AN 119

Whether or not Alexandria Ocasio-Cortez is ultimately an effective congressperson remains to be seen, writes *New York Times* columnist Paul Krugman, but she’s already doing a great job of advancing tax policy.

Ocasio-Cortez has advocated a tax rate of 70 to80 percent on very high incomes, which Krugman says seems “crazy”—except to the world’s leading expert on public finance.

“It’s a policy nobody has ever implemented, aside from … the United States, for 35 years after World War II — including the most successful period of economic growth in our history,” he writes.

The government should look at taxation as a way to raise revenue for the government.

“When taxing the rich, all we should care about is how much revenue we raise,” he explains. “The optimal tax rate on people with very high incomes is the rate that raises the maximum possible revenue.”

According to a fellow Nobel laureate in economics, “the optimal rate” for taxing the rich is 73 percent.

“So AOC, far from showing her craziness, is fully in line with serious economic research,” he writes. “She definitely knows more economics than almost everyone in the G.O.P. caucus.”

Read the full article here.

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https://www.alternet.org/2019/01/suicide-is-up-opioid-deaths-are-up-economic-inequality-is-up-and-its-not-a-coincidence/

The suicide rate rose by 3.7 percent from 2016 to 2017, contributing, with opioid deaths, to a drop in U.S. life expectancy. But both suicide and opioids may be linked to a higher-level cause: economic inequality.The link between inequality and suicide isn’t new, but it may be gaining in relevance given the increased inequality in the U.S. in recent decades.

Research has generally found that the higher the level of income inequality in the U.S. states, the higher the probability of death by suicide. According to social strain theory, when there’s a large gap between the rich and the poor, those at or near the bottom struggle more, making them more susceptible to addiction, criminality and mental illness than those at the top.

The official suicide rate may be too low, with opioid deaths classified as accidents that may not have been so accidental:

[Epidemiologist Ian] Rockett said he’s involved in a clinical trial at Harvard where researchers are interviewing people who survived overdoses.

“[Researchers] asked them about if they were considering suicide at the time and there’s evidence that quite a few of them are,” he said.

And, Rockett points out, opioid addiction itself can be a symptom of economic inequality:

In West Virginia, for instance, loss of jobs in the coal industry has led to unemployment and underemployment that forces people into multiple jobs to make ends meet, he said. Construction or extraction industries jobs have high injury rates that can lead to addictions to opioids.

“It’s not surprising, it’s tragic, actually, but growing inequality, under employment, unemployment, I think are major factors there,” he said.

Our economy is killing people, and the killer part is the part Republicans are trying to boost.

rauner rich lost to richer guy? adeslson wife gets freedom metal?!

see voodoo tax cut, 1/2 no increase. 1/4 minimal?

As we try to grasp the reasoning behind cuts to life-saving programs while billion-dollar incomes and trillion-dollar profits are being made, we must understand that extreme wealth deadens parts of the brain. Empathy and honesty go first. Then rationality, as evidenced by some of the outlandish excuses given by the very rich for their abuses.

Excuses for Inequality

Here's what Goldman Sachs adviser Brian Griffiths said about it: "We have to tolerate the inequality as a way to achieve greater prosperity and opportunity for all."

U.S. wealth distribution has become so extreme that nearly half of America has, on the average, ZERO WEALTH (debt exceeds assets). As for income, the richest 1% seemed to perform the impossible from 2009 to 2011, capturing MORE THAN 100% of the new income gains (income decreased for the other 99%).

As irrational as it might seem to find an excuse for all this, the Heritage Foundation is up to the task, claiming that poor Americans are actually doing quite well with their TVs and air conditioners. Never mind that debt for the poorest quintile of Americans averages $27,000 more than their possessions.

Excuses for Bank Fraud

It seems unlikely that anyone would try to justify the lack of punishment for manipulating global interest rates and consorting with drug cartels. But excuses were readily available. Hyperbole made up for incomprehensibility. Treasury Secretary Hank Paulson warned us that without a bailout the world economy would collapse "within 24 hours." Assistant attorney general Lanny Breuer added that with criminal charges "the entire banking system would have been destabilised."

Others questioned whether crimes had really been committed, or whether the people in charge even knew what was happening. In any event, bank backers noted, the financial institutions were fined. Four weeks of profits. And a bank CEOsaid he was "profoundly sorry."

Excuses for a Dormant Minimum Wage

Despite the logic and fairness of sharing record profits with low-wage workers who helped to make it all possible, a minimum wage increase has long been rejected because of the claim that it will increase unemployment. This has been refuted again and again and again. Yet well-positioned people persevere, armed with the same excuse. Says Paul Ryan: "I think it's inflationary. I think it actually is counterproductive in many ways. You end up costing jobs from people who are the bottom rung of the economic ladder."

The Economic Policy Institute calculated that a minimum wage increase would actually CREATE up to 100,000 jobs by the middle of 2014.

Excuses for Not Paying Taxes

Rather than excuses, corporate heads often take the more aggressive denial route with their comments:

-- A GE spokesperson: "We are committed to acting with integrity in relation to our tax obligations." GE paid 0% from 2008 to 2010.

-- An Exxon spokesperson: "..any claim we don't pay taxes is absurd...ExxonMobil is a leading U.S. taxpayer." Exxon paid2% from 2008 to 2010.

But CEOs still manage to come up with creative excuses. Caterpillar's Doug Oberhelman blamed Illinois. He said the state has "created an environment that is unfriendly to business and investment." Caterpillar paid less than 1% in state income taxes from 2008 to 2010.

As for individual taxes, the wealthy hang onto the foggy (and discredited) notion that a higher tax rate on the rich somehow "hurts the economy."

Numerous inventive excuses come with the estate tax, most of them recycled from other tax arguments. The estate tax is accused of slowing economic growth, destroying jobs, suppressing wages, discouraging saving, and promoting wasteful spending. Actual facts, meanwhile, come from the Center on Budget and Policy Priorities, which notes that only the richest 2 in 1,000 estates pay any estate tax, at levels generally less than one-sixth of their values.

Excuses were even available for the special case of Facebook's part-owner Eduardo Saverin, who serendipitously landed Mark Zuckerberg as a roommate at Harvard, used American resources to make billions, and then revoked his citizenship to avoid paying any tax at all. A Forbes writer called Saverin an "American hero" for quitting on America. The American Thinker said "The U.S. tax code is so oppressive that smart and successful people like Saverin are compelled to renounce citizenship.." Saverin's defenders might not be aware of an OECD report that ranked U.S. taxes among the lowest in the world.

Excuses for No Taxes At All

One might feel ashamed paying no sales tax on credit default swaps when low-income mothers pay 10% on winter clothes for the kids. But not the guys on Wall Street. At any mention of a financial transaction tax (FTT) they get testy: It will ruin our liquidity! It will hurt the economy! It's a sin tax!

But an FTT is inexpensive to administer, proven successful in other countries, and capable of generating hundreds of billions of dollars per year.

Perhaps it's only fair, in conclusion, to excuse the super-rich for their lack of empathy and honesty and rationality. They believe that their upward redistribution of wealth is showing everyone else the value of a little initiative and hard work. With such a spirit of free enterprise we can all aspire to the lofty goals of Charles Koch: "I want my fair share - and that's ALL of it."

Paul Buchheit is the founder and developer of social justice and educational websites (UsAgainstGreed.org, PayUpNow.org, RappingHistory.org), and the editor and main author of "American Wars: Illusions and Realities" (Clarity Press). He can be reached at paul@UsAgainstGreed.org.

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https://www.alternet.org/tax-cheating-its-not-just-trumps

radio shows and talks from London to Boston to Richmond, Ind., people keep asking me how the Trump family got away with stealing a half billion dollars, in today’s money, from our government, as The New York Times reported last month.

This story first appeared at DC Report.

One big part of the answer is that Congress showers real estate investors with tax benefits. It also makes auditing many types of real estate transactions incredibly tedious and time-consuming. Combine that with years of budget cuts and what we get is an IRS—the federal Tax Police Department—that is well suited to pursuing the financial equivalent of tricycle thefts, but not larceny on a billionaire scale.

This may change. If we get a House or Senate under control of the Democrats we can expect thorough, expert investigations into Donald Trump’s recent personal, gift and business tax returns.

Whether that turns into real tax reform, especially when it comes to landlords who cheat, will depend on whether the citizenry demands it. In turn, that will depend on Congressional investigators. How clearly, powerfully and repetitively will they make the point that our tax system, by design, helps cheaters like the Trumps?

Separate and Unequal Taxation

The story of how the Trumps got away with what The Times called “outright fraud” begins with understanding that America has two systems of individual income taxation, separate and unequal.

One system relies on independent verification. It covers all workers, pensioners and, in the last decade thanks in part to my work, stock market investors. The other system is based on trust. Congress does not trust workers, but it assumes that people who run businesses are honest, so there is no need to independently verify the income they report.

One system is reasonably well funded. The other is starved for funds and staff to enforce the tax laws. Guess which system the Trumps fall under.

Long before Trump became president our Congress created a tax system that makes tax cheating by real estate families a breeze. By slashing the IRS staff—down a third in the last 25 years while the population grew by a quarter—the deck is stacked even more in favor of the Trumps.

The harsh reality is that Congress does not trust workers. For decades it has required that employers withhold taxes before workers get their paychecks. The taxes, along with a detailed report of how much each worker earned, go straight to the Treasury.

There is little cheating under that efficient and effective system, which is mostly automated. Indeed, 99% of income taxes due on wages are collected and turned over, the Government Accountability Office, an investigative arm of Congress, reported last year.

But when it comes to the traditional Republican base of small business owners the rate of reliable income reporting plummets, the GAO found.

Landlords, farmers and sole proprietors and some others tell the IRS how much they made. For them, there is little to no third party verification.

Instead of 99% accurate reporting, the accuracy rate for these lucky duckies is just 37%.

That doesn’t mean that only 37% of income is reported, only that just 37% of reports are accurate. The majority of these people report income, just not all of it.

Within this system where cheating predominates, there is a black hole of income that it is especially hard to detect. That hole is real estate, especially closely held real estate partnership income.

Avoiding Detection

Under rules set by Congress the real estate family that cheats together is unlikely to get caught, as Jerry Curnutt, the retired IRS partnerships specialist, figured out two decades ago and I have reported on again, and again and again and again.

Our government takes little interest in the kind of cheating the Trumps and other real estate families engage in. But it takes deep interest in the possibility of tax cheating by low-wage workers.

And if they are caught, landlords can often settle for pennies on the dollar by hiring aggressive lawyers who threaten to tie up the dwindling IRS staff in court for years.

The Trumps sometimes relied on the notorious Roy Cohn, the attack-dog lawyer for Sen. Joe McCarthy before Cohn became a consigliere for the Genovese and Gambino crime families and for Donald Trump.

It also helps the Trumps and other real estate families that they often report negative incomes. Under rules set by Congress, if you own a lot of real estate you can legally report you made less than nothing for income tax purposes while living a lavish lifestyle.

Consider an IRS auditor who finds that a real estate family reported, say, $10 million of negative income on which no tax is due but really had only $1 million of negative income. Either way, no tax is due immediately. That means the IRS auditor has no incentive to pursue that unwarranted $9 million of negative income, as some auditors have told me in vivid detail.

The cheating real estate family, on the other hand, gets to carry that bogus $9 million forward until a year when they can use it to offset actual income—so it has real value to them.

Cheating High and Low

Our government takes little interest in the kind of cheating the Trumps and other real estate families engage in. In contrast to this, it takes an extraordinarily deep interest in the possibility of tax cheating by workers, especially low-wage workers.

To illustrate this let’s review an audit released Oct. 9 by J. Russell George, the Treasury Inspector General for Tax Administration or TIGTA. Congress created the position after 1997 and 1998 hearings on alleged IRS abuses of taxpayers. The hearings were shams, the testimony nonsense, as The Wall Street Journal, local newspapers, Tax Notes magazine and my reporting in The New York Times all showed at the time.

TIGTA’s latest audit examines taxes on cash tips paid to food servers, who under a federal law signed by President Clinton can be paid just $2.13 an hour, far less than the minimum wage of $7.25 an hour.

Tips are often paid in cash and often go unreported for tax purposes.

According to TIGTA, “the IRS estimates that 10% ($23 billion) of the estimated 2006 individual income tax underreporting Tax Gap ($235 billion) is due to unreported tip income by employees.”

The amount of unreported tip income is bupkis. It’s about one-third of one percent of all wage and tip income. How much tax money are we going to collect from workers who make such little money?

On the other hand, the Inspector General pays hardly any attention to high-end tax cheating. He’s never scrutinized IRS policing of hedge funds.

While George, a former Republican operative, ignores the tax habits of the rich, he has an extraordinary obsession with the working poor. I searched the TIGTA website for audits and reports on the Earned Income Tax Credit, a kind of negative income tax for low-wage workers, and got this astonishing result:12,600 hits. Few of those are audits, to be sure. But no one even blanched at TIGTA when I asked about the huge number of citations about a benefit for the working poor.

TIGTA officials declined to comment on the record.

What about the lack of audits related to hedge funds? While there are no audit reports, they do get all of two passing mentions at the TIGTA website.

And what of landlords, like the Trumps used to be when they were cheating the government? Just 11 mentions, not one of which appears to be about tax cheating and how to reduce it.

---

https://www.alternet.org/while-rest-world-burned-billionaires-made-more-money-2017-any-other-year-history

During a year in which so much of the world faced deep poverty, the corrosive effects of austerity, and extreme weather caused by the worsening human-caused climate crisis—from devastating hurricanes to deadly wildfires and floods—one class of individuals raked in more money in 2017 than any other year in recorded history: the world's billionaires.

"No money for health or infrastructure, all the money in the world for yachts."

—Josh Shepperd

According to the Swiss bank UBS's fifth annual billionaires report published on Friday, billionaires across the globe increased their wealth by $1.4 trillion last year—an astonishing 20 percent—bringing their combined wealth to $8.9 trillion.

"The past 30 years have seen far greater wealth creation than the Gilded Age," the UBS report notes. "That period bred generations of families in the U.S. and Europe who went on to influence business, banking, politics, philanthropy, and the arts for more than 100 years."

UBS estimates that the world now has a total of 2,158 billionaires, with 179 billionaires created last year. The United States alone is home to 585 billionaires—the most in the world—up from 563 in 2017.

Meanwhile, according to a June report by U.N. Special Rapporteur on Extreme Poverty and Human Rights Philip Alston, 18.5 million Americans live in extreme poverty and "5.3 million live in Third World conditions of absolute poverty."

A significant percentage of the "newly created" billionaires are hardly the self-made men—and they are overwhelmingly men—of popular lore. According to UBS, 40 of the 179 new billionaires created last year inherited their wealth—a trend that has driven an explosion of wealth inequality over the past several decades.

According to UBS, this trend will continue to accelerate over the next 20 years, given that there are currently 701 billionaires over the age of 70.

"A major wealth transition has begun. Over the past five years (2012–2017), the sum passed by deceased billionaires to beneficiaries has grown by an average of 17 percent each year," the UBS report concludes. "Over the next two decades we expect a wealth transition of $3.4 trillion worldwide—almost 40 percent of current total billionaire wealth."

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NEW

https://www.alternet.org/silicon-valley-rich-get-richer-while-wages-stagnate-rest

Silicon Valley is considered an economic powerhouse, lauded as a model of economic growth the world over. Yet the wealth disparity between low, mid and high-level tech workers is far greater than it was two decades ago; worse, the economic impact of the tech industry in the Bay Area has been making the rich richer and the poor poorer, according to a new study published on Monday.

The report, entitled “Still Walking the Lifelong Tightrope: Technology, Insecurity and The Future of Work,” analyzes how wealth and economic gains by big tech companies are being distributed in Silicon Valley. The report is a follow-up to a similar one conducted in the late 1990s called “Walking the Lifelong Tightrope: Negotiating Work in the New Economy,” which was conducted by the same author, Dr. Chris Benner, in the midst of discussions at the time around tech being the "new economy."

Benner, professor and director of the Everett Program for Technology and Social Change at UC Santa Cruz and lead author of the study, told Salon he was surprised by the latest study’s findings this time around, and is sounding the alarm that Silicon Valley's economy could create wealth inequality across the world if replicated. "We were surprised by the results,” Benner told Salon. “We expected to see growing inequality, but I didn’t expect to see the level in declining wages across income distribution and the extent in which returns to labor have declined.”

The decline found by Benner and his colleagues is significant. Specifically, the study found that over the past 20 years, economic input in Silicon Valley increased by 74 percent, but inflation-adjusted wages fell for 90 percent of jobs. Nine in 10 Silicon Valley-jobs pay lower wages than they did in the late 1990s. A brief of the report stated: “In fact, if labor’s share of GDP had been the same in 2016 as in 2001, the average Silicon Valley worker would have received an additional $8,480 in pay and benefits that year alone.”

“Owners of high-tech firms and investors are making tremendous gains over last 20 years,” Benner told Salon.

As a result, this disparity is causing a trend of growing low-wage jobs in Silicon Valley — and tech workers over the age of 50 could be the most vulnerable to this trend. As the report states:

Net job growth in the last 20 years has been disproportionately in low-wage jobs, with the proportion of workers in low wage jobs increasing by 25%, while the proportion of workers in middle and upper wage jobs declined [...] Challenges for older workers in the industry have accelerated in the region. In the mid-1990s, the highest paid workers in high tech had an average age of 51; today, that average age has crept down to 48. High-tech workers older than 48, on average, earn less than younger workers.

The authors of the report don’t place blame on the technology industry though. Instead, they conclude the disparity and disconcerting wage trend is a result of the lack of public policy.

“The recommendations we laid out 20 years ago still make sense as public policy, but calling for national change in labor market institutions and policies is no longer sufficient,” the report notes. “Especially in the current political climate, we need to also be exploring local, regional and state level solutions to these problems. Such innovations, in addition to supporting workers in Silicon Valley and California, can serve as a model for national policies in the future. “

Benner said policies such as increasing minimum wage, creating affordable housing, and lowering the cost of living are essential to closing the wealth gap — especially since it is the tech industry's contract workers who suffer most from the high cost of living. This category includes janitors, cafeteria workers, and security guards.

Derecka Mehrens, executive director of Working Partnerships USA — which collaborated in the research for the report — said in a statement Silicon Valley’s trend could be problematic, especially since other cities are trying to replicate it.

“Cities across the country are falling head over heels to emulate Silicon Valley’s boom, but the reality is that tech's business models mean 9 in 10 workers here don’t share in the benefits – only the costs in sky-high housing prices and gridlocked traffic,” Mehrens said. “It’s clear those business models need to change so that the workers and communities who make the tech industry’s success possible see a fair return on their work.

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https://www.alternet.org/watch-your-wallets-next-crash-coming

September 15 will mark the tenth anniversary of the collapse of Lehman Brothers and near meltdown of Wall Street, followed by the Great Recession.

Since hitting bottom in 2009, the economy has grown steadily, the stock market has soared, and corporate profits have ballooned.

But most Americans are still living in the shadow of the Great Recession. More have jobs, to be sure. But they haven’t seen any rise in their wages, adjusted for inflation.

Many are worse off due to the escalating costs of housing, healthcare, and education. And the value of whatever assets they own is less than in 2007.

Last year, about 40 percent of American families struggled to meet at least one basic need – food, health care, housing or utilities, according to an Urban Institute survey.

All of which suggests we’re careening toward the same sort of crash we had in 2008, and possibly as bad as 1929.

Clear away the financial rubble from those two former crashes and you’d see they both followed upon widening imbalances between the capacity of most people to buy, and what they as workers could produce. Each of these imbalances finally tipped the economy over.

The same imbalance has been growing again. The richest 1 percent of Americans now takes home about 20 percentof total income, and owns over 40 percent of the nation’s wealth.

These are close to the peaks of 1928 and 2007.

The U.S. economy crashes when it becomes too top heavy because the economy depends on consumer spending to keep it going, yet the rich don’t spend nearly as much of their income as the middle class and the poor.

For a time, the middle class and poor can keep the economy going nonetheless by borrowing. But, as in 1929 and 2008, debt bubbles eventually burst.

We’re getting dangerously close. By the first quarter of this year, household debt was at an all-time high of $13.2 trillion.

Almost 80 percent of Americans are now living paycheck to paycheck. In a recent Federal Reserve survey, 40 percent of Americans said they wouldn’t be able to pay their bills if faced with a $400 emergency.

They’ve managed their debts because interest rates have remained low. But the days of low rates are coming to an end.

The underlying problem isn’t that Americans have been living beyond their means. It’s that their means haven’t been keeping up with the growing economy. Most gains have gone to the top.

It was similar in the years leading up to the crash of 2008. Between 1983 and 2007, household debt soared while most economic gains went to the top. Had the majority of households taken home a larger share, they wouldn’t have needed to go so deeply into debt.

Similarly, between 1913 and 1928, the ratio of personal debt to the total national economy nearly doubled. As Mariner Eccles, chairman of the Federal Reserve Board from 1934 to 1948, explained: “As in a poker game where the chips were concentrated in fewer and fewer hands, the other fellows could stay in the game only by borrowing.”

Eventually there were “no more poker chips to be loaned on credit,” Eccles said, and “when … credit ran out, the game stopped.”

After the 1929 crash, the government invented new ways to boost wages – Social Security, unemployment insurance, overtime pay, a minimum wage, the requirement that employers bargain with labor unions, and, finally, a full-employment program called World War II.

After the 2008 crash, the government bailed out the banks and pumped enough money into the economy to contain the slide. But apart from the Affordable Care Act, nothing was done to address the underlying problem of stagnant wages.

Trump and his Republican enablers are now reversing regulations put in place to stop Wall Street’s excessively risky lending.

But Trump’s real contributions to the next crash are his sabotage of the Affordable Care Act, rollback of overtime pay, burdens on labor organizing, tax reductions for corporations and the wealthy but not for most workers, cuts in programs for the poor, and proposed cuts in Medicare and Medicaid – all of which put more stress on the paychecks of most Americans.

Ten years after Lehman Brothers collapsed, it’s important to understand that the real root of the Great Recession wasn’t a banking crisis. It was the growing imbalance between consumer spending and total output – brought on by stagnant wages and widening inequality.

That imbalance is back. Watch your wallets.

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https://www.alternet.org/news-amp-politics/heres-how-hurricanes-contribute-racial-inequality

Hurricane Lane, which is bearing down on Hawaii, is a reminder of the devastation hurricane season can bring.

Only one year ago Hurricane Harveyravaged Houston, followed closely by Irma and Maria, which left a trail of destruction across Florida and Puerto Rico. Despite the private and government aid provided after these disasters, thousands continue to struggle even today.

However, not everyone is struggling. In fact, some actually benefit economically from these extreme weather events.

In a new study, which I co-authored with my colleague James Elliott, we found that populations that are privileged in terms of education, race or homeownership gain wealth in the aftermath of natural disasters, exacerbating already wide economic inequities.

Not only that, how the government delivers aid is partly to blame.

Disasters on the rise

Natural disasters from hurricanes to wildfires are on the rise, both in terms of frequency and severity.

And they take a heavy toll. Last year alone, the United States suffered US$260 billion in direct damages from natural disasters. While that’s a devastating figure, it fails to encompass the full extent of the impact – such as a loss in income or uncovered expenses such as medical bills – that can last for months and even years after cleanup begins.

Previous research has shown the aftermath of disasters is more devastating for less privileged residents as they are more likely to lose their job, have to relocate and payhigher rents due to reduced housing availability.

In our recent paper in the journal Social Problems, we found that the effects are even more profound, with whites, the highly educated and homeowners actually improving their relative financial situation after a disaster, while blacks, those with less education and renters are worse off compared with their peers.

Whites make gains while others lose

We combined nationally representative data from the Panel Study of Income Dynamics on nearly 3,500 families with government figures on natural hazard damages, Federal Emergency Management Aid and local population demographics in every U.S. county.

We then explored how extreme natural disasters influenced changes in family wealth from 1999 to 2013. Throughout our analysis, we controlled for race, education, age, homeownership, family status, residential mobility as well as neighborhood and county demographics with the aim of comparing households that were similar. We also only compared families who started out with similar wealth in 1999.

Overall, we found a surprisingly strong correlation between the scale of damage a county experienced and an increase in average wealth. That is, people who lived in counties that suffered extreme disasters tended to accumulate more wealth over the period than those who lived in mostly unaffected parts of the country. And the more damage a county experienced, the more pronounced the relative gains in wealth.

Greater wealth, however, was not experienced by everyone. Using a statistical technique called interactions, we were able to see how these changes affected different segments of the population depending on race, education and homeownership.

First, we considered the effects of race and found that whites who lived in counties that experienced extreme natural disasters accumulated $100,000 more wealth than their peers with similar characteristics who did not.

For people of color, on the other hand, this effect was reversed. Specifically, black residents living in disaster-prone counties lost $46,000 in wealth compared with their counterparts elsewhere. And Latino residents in affected counties lost $101,000 relative to similar peers.

In other words, while whites benefited financially by living in areas hit by hurricanes and other disasters, people of color were clobbered.

We then examined the impact of education, holding other factors constant. We found that higher levels of education were also associated with a tendency to benefit from natural disasters, while those with less experienced devastating losses.

Finally we focused on homeownership. Similarly, our results showed that those who owned emerged a lot better off than those who rented.

Our findings suggest that natural disasters are worsening wealth inequality, especially along racial lines. For example, in Monmouth, New Jersey – a New York City suburb that experienced the most natural disaster damage in the U.S. from 1999 to 2013 – $111,000 of the increase in the white-black wealth gap during the period can be attributed to the impact of the disasters.

This map visualizes these rising inequalities across the largest metropolitan areas.

FEMA aid plays a role

This evidence is depressing in its own right. Yet, what is arguably even more disturbing is Federal Emergency Management Aid is further exacerbating these inequalities.

FEMA aid is distributed to mitigate the negative repercussions of hazards. In the best of worlds this federal assistance would reduce inequality – or at least curtail its expansion. What we found is quite the opposite.

Unlike what you might think, FEMA aid is not distributed solely based on damage or need. In fact, when we compared the amount of natural disaster damage in counties across the U.S. from 1999 to 2013 with how much aid FEMA allocated to them, the correlation is weak. This suggests factors other than need, such as politics, are primarily driving FEMA aid decisions.

However, statistically, this means we can isolate the effect of FEMA aid from natural hazards. When we did this, we found that FEMA aid also exacerbated inequalities. In New York County, for example, which received nearly $8 billion in FEMA aid from 1999 to 2013, we found that $105,000 of the increase in the white-black wealth gap is attributable to FEMA aid.

In short, much like natural disasters themselves, FEMA aid is exasperating wealth inequality.

Lingering questions

....

https://www.alternet.org/activism/foreign-policy-can-change-everything-everyone

We’re in the midst of an unprecedented social, political and environmental crisis that will require us to change everything. Including the one thing we won’t discuss: war.

War is the weaponization of discrimination, classism and misogyny. So why are so few women talking about it?

We talk about #MeToo and the first time (or worst time) it happened to us. We put on our pussyhats and resist and persist and insist. But the resistance that rose up in opposition to the Trump administration does not resist war, and anti-war messaging is still missing from the Women’s March. While virtually every women’s television talk show and radio program in the country now talks about politics on a daily basis, they’re still not talking about the politics of war. We’ve been told that war isn’t our concern. That was a lie, ladies. Foreign policy is a feminist issue. Want more money for health care, jobs and education? More than two-thirds of federal spending is defense-related. Let’s check that checkbook first.

Domestic abuse your cause? Let’s talk about how wives of combat vets with PTSD are more likely to be killed by their spouses than any other demographic. Or how traumatized combat vets are responsible for 21 percent of domestic violence nationwide, according to a Yale study.

Got a problem with gun violence and assault weapons in schools? Let’s discuss the way weapons of war are coming home and how many United States gun manufacturers are also military contractors.

Concerned about climate change? The U.S. military uses more fossil fuelsthan the majority of nations, and the billions of dollars wasted on the Iraq war could have converted the whole planet to green energy.

Women are leading the way to protect our water and create a mass climate mobilization that responds to our ecological crisis like the existential emergency it is. Why then are we still so silent about how the war on women isthe war on the world? Why so silent about America’s de facto foreign policy of using armed force to safeguard the capitalism that is destabilizing the climate? Why so silent about the fact that women—particularly women of color, women living in poverty and marginalized women—disproportionately bear the burden of war and the violence it begets?

Dateline: America, 2018. All roads lead to war.When #WomenDisobey and righteously demand an end to putting immigrant children in detention centers, we also should demand an end to military contractors like General Dynamics and MVM, Inc., which are profiting from those centers. And making money on the misery this country creates for children overseas.

We can talk about intersectionality and proclaim "gender justice is racial justice is economic justice," as Women’s March organizers did in their powerful Unity Principles. But economic justice is a fiscal impossibility when defense-related spending accounts for slightly more than two-thirds of the national budget. This country puts more money into the military than the next 10 nations combined while tens of millions of women and children living in poverty struggle to survive. In fact, war spending makes social inequality worse, according to a June 2018 report by the Costs of War project at Brown University. An analysis of past and present wars since 1812 "suggests that the current combination of domestic borrowing to pay for war, accompanied by continuous tax cuts, have led and will continue to lead to rising social inequality in the US."...

pvtization boosts inequality

https://www.huffingtonpost.com/donald-cohen/how-privatization-is-fuel_b_13173324.html

https://www.alternet.org/buried-fine-print-trump-rule-would-give-25-billion-tax-cut-big-bank-fat-cats

Wall Street banks continue to enjoy record profits thanks to President Donald Trump's $1.5 trillion tax scam, Trump's Treasury Department—headed by former Goldman Sachs executive Steve Mnuchin—quietly moved to hand big banks yet another major gift on Wednesday by hiding a $2.5 billion tax cut in the fine print of an "esoteric" new rule proposal (pdf).

At first glance, the Trump administration's rule appeared to be little more than a mundane set of regulations aimed at providing owners of so-called pass-through businesses everything they "need to comply with the Republican Tax Cuts and Jobs Act," as Reuters put it.

But Capital & Main journalist David Sirota decided to take the radical step of actually reading the proposal in its entirety, and he found that the White House's rule alsoseeks to exclude banking from the "financial services" category—a move that would allow thousands of large banks to take advantage of the controversial tax cut for pass-through income included in Trump's tax bill. As they were hashing out the details of their tax bill behind closed doors, Sirota notes, Republican lawmakers included a provision that prohibited businesses in the "financial services" sector from qualifying for the tax cut in an effort to counter "assertions that the bill could enrich big banks."

But, at the direction of bank lobbyists, the Trump administration's new rule asserts that "'financial services' don't include banking," thus allowing "hundreds of banks operating as S corporations—as well as their owners—[to] claim the tax cut," Sirota writes.

In addition to taking the side of bank lobbyists with its new rule, the Trump administration also explicitly "echoed their views" in the fine print of its proposal, Sirota points out.

"Banking industry lobbyists pushed for the interpretation—acknowledging that the bill generally blocked pass-through tax cuts for businesses in financial services, but arguing that 'financial services are, however, clearly something other than banking,'" Sirota writes. "The Trump Treasury Department not only sided with the lobbyists, but in the fine print of its new rule, which is now subject to a public comment period before it goes into force, echoed their views."

According Daniel Hemel, a tax law professor at the University of Chicago, the Trump administration's rule change would reward "roughly 2,000 banks around the country that qualify as S corporations."

"It's a safe bet that most of the S corporation shareholders benefited by today's decision will fall into the upper reaches of the top one percent—not many middle-class folks own a bank," Hemel told Capital & Main. "If you assume a return on assets of around one percent and S corporation bank assets in the range of $400 billion, then the move reduces the total tax liability of S corporation bank shareholders by $300 million per year for 2018 through 2025. We're talking about something like $2.5 billion total."

In response to the Trump White House's latest attempt to reward the wealthy—which comes as wages for most workers are declining—Sen. Bernie Sanders (I-Vt.) wrote, "It's never been more clear who the Trump administration is really working for."

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slate on princeton oligarch study (note aca as equalizer):

...

But in the more recent decades Gilens and Page examine, neither party has enacted policy that fulfilled the wishes of average Americans alone. It did not matter whether the majority party was Democrat or Republican—both tend to ignore the median public opinion. This does not necessarily mean the average voter always loses: Just as poor folk in Kansas sometimes favor policies that benefit the rich, affluent individuals and interest groups can favor policies that benefit the poor. Gilens points out in his 2012 essay that LBJ’s landmark Great Society bills enjoyed only slightly less popularity among elites than among low- and middle-income Americans, but were supported by both groups. Warren Buffett saying he ought to pay higher taxes may not be as unusual as it seems. But it is the support of the rich that matter. Policies favored by the average voter are likelier to pass based on the chance that the rich support them.

Over at the New York Times, Ruy Teixeira thinks political inequality aggravates economic inequality; Jelani Cobb thinks we’re letting the oligarchs rule. Paul Krugman’s response from Monday was more hopeful than most others. He writes:

“Obama has in fact significantly raised taxes on very high incomes, largely through special surcharges included in the Affordable Care Act; and what the Act does with the extra revenue is expand Medicaid and provide subsidies on the exchanges, both means-tested programs whose beneficiaries tend to be mainly lower-income adults.”

Indeed, it is worth pointing out that the most recent data analyzed for the paper ends in 2002. While the relative political clout of the rich has probably only increased, it also means that the data predate the clear expansions of welfare since then. Rich whites are more likely to dislike the Affordable Care Act, and yet it is here to stay. So I don’t think we should be unduly dour. Studying the relative fairness of representation between rich and poor and individuals and political groups is only possible in a mature, self-aware democracy with an eye toward self-improvement. Gilens concluded as much two years ago, when he wrote:...

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as...Trump and corporate media outlets on Friday enthusiastically touted new GDP figures showing that the U.S. economy grew by 4.1 percent in the second quarter of 2018, many economists and progressive commentators were quick to counter the glowing headlines by pointing out that corporations and the rich are feasting on most of the growth while workers see their wages fall.

"What the president won't talk about is that there is slow—and even negative—growth in real wages adjusted for inflation. So if GDP is rising, but wages [are] falling, the money is going to the top," Timothy McBride, a health economist at Washington University in St. Louis, noted in response to Trump's celebratory speech on the White House lawn on Friday.

"You can't eat GDP," writer Dante Atkins added on Twitter. "GDP doesn't pay the bills." As Jared Bernstein, senior fellow at the Center on Budget and Policy Priorities, observed in an analysis of the Commerce Department's new numbers for the Washington Post, "in our era of high economic inequality, GDP should definitely not be taken as a signal of broad well-being. For that, we have to look at not just how 'the economy' is doing, but how all the people in the economy are doing."

GDP growth could be 5%, 10% or 30%, but if wages for most people aren't growing, then what's the point?

— Michael Linden (@MichaelSLinden) July 27, 2018

On Twitter, Bernstein pointed out that—even in the midst of steadily rising growth, record-breaking corporate profits, and lofty promises from Trump and GOP lawmakers—most workers are not seeing a noticable boost in their paychecks.

"Any administration would tout a strong GDP report like today's, but if it's not reaching workers' paychecks, which it isn't, then cease the applause and get to work on policy to reconnect growth to much more broadly-share prosperity," he said.

News this week that the Republican Party is quickly moving ahead with their "tax cuts 2.0" plan—which would double-down on tax cuts for the rich and corporations—seems to suggest that Trump and the GOP are wholly uninterested in working to ensure that economic growth is distributed equitably.

While GDP growth may not be a good measure of workers' well-being, it is a good indication that the wealthiest Americans are seeing their incomes climb, given that most of America's economic growth in recent years—particularly after the 2008 Wall Street crash—has been hoarded by the top one percent."The new line from Republicans in Congress is that Americans are 'better off' because of last year's tax cut, so we have to extend it," Morris Pearl, a former managing director at Blackrock and chair of Patriotic Millionaires, said in a statement. "Well, some Americans are better off—people like me who are wealthy enough to not need work—but most Americans are still struggling."

In an analysis of recent economic trends on Thursday, New York Times columnist Thomas Edsall highlighted the "continued failure of wages to advance, despite job growth, while corporate profits shoot up to record levels."

Edsall then pointed to a striking chart, which shows that the share of profits going to labor has declined sharply since the early 2000s:

Far from reversing this trend and boosting the incomes of workers—as Trump claimed in front of the White House on Friday—the GOP's $1.5 trillion tax cut package has so far produced overall wage decline.

"While wages have risen by 12.9 percent overall since 2006, wages adjusted for inflation (so-called 'real wages') have actually fallen by 9.3 percent," notes Vox's Emily Stewart. "And between the first and second quarters of 2018 — after the tax cuts were enacted—real wages fell by 1.8 percent

https://www.alternet.org/americas-white-collar-middle-class-takes-terrifying-slide-down-mobility-ladder

...While they were playing Twister and imagining a bright future, someone apparently decided that they didn’t really matter. Clouds began to gather—a “dark shimmer of constantly shifting precariousness,” as journalist Alissa Quart describes in her timely new book “Squeezed: Why Our Families Can’t Afford America.”

The things these kids considered their birthright—reputable colleges, secure careers, and attractive residences—were no longer waiting for them in adulthood.

Today, with their incomes flat or falling, these Americans scramble to maintain a semblance of what their parents enjoyed. They are moving from being dominant to being dominated. From acting to acted upon. Trained to be educators, lawyers, librarians, and accountants, they do work they can’t stand to support families they rarely see. Petrified of being pushed aside by robots, they rankle to see financial titans and tech gurus flaunting their obscene wealth at every turn.

Headlines gush of a humming economy, but it doesn’t feel like a party to them—and they’ve seen enough to know who will be holding the bag when the next bubble bursts.

The “Middle Precariots,” as Quart terms them, are suffering death by a thousand degradations. Their new reality: You will not do as well as your parents. Life is a struggle to keep up. Even if you achieve something, you will live in fear of losing it. America is not your land: it belongs to the ultra-rich.

If climbing up the ladder of success is the great American story, slipping down it is the quintessential tragedy. It’s hard not to take it personally: the ranks of the Middle Precariot are filled with shame.Much of Quart’s book highlights the mirror image of the downwardly mobile middle class Trump voters from economically strained regions like the Midwest who helped throw a monkey wrench into politics-as-usual. In her tour of American frustration, she talks to urbanites who lean liberal and didn’t expect to find themselves drowning in debt and disappointment. Like the falling-behind Trump voters, these people sense their status ripped away, their hopes dashed.

They are somebodies turning into nobodies.

And there signs that they are starting to revolt. If they do, they could make their own mark on the country’s political landscape.

The Broken Bourgeoisie

Quart’s book takes a sobering look at the newly unstable bourgeoisie, illustrating what happens when America’s off-the-rails inequality blasts over those who always believed they would end up winners.

here are Uber-driving teachers and law school grads reviewing documents for $20 an hour—or less. Ivy Leaguers who live on food stamps.There’s the Virginia accountant who forks over nearly 90% of her take home pay on care for her three kids; the Chicago adjunct professor with the disabled child who makes less than $24,000 a year; and the California business reporter who once focused on the financial hardships of others and now faces unemployment hers

Lacking unions, church communities and nearby close relatives to support them, the Middle Precariots are isolated and stranded. Their labor has sputtered into sporadic contingency: they make do with short-term contracts or shift work. (Despite the much-trumpeted low unemployment rate, the New York Times reports that jobs are often subpar, featuring little stability and security). Once upon a time, only the working poor took second jobs to stay afloat. Now the Middle Precariot has joined them.

Quart documents the desperate measures taken by people trying to keep up appearances, relying on 24/7 “extreme day care” to accommodate unpredictable schedules or cobbling together co-living arrangements to cut household costs. They strain to provide things like academic tutors and sports activities for their kids who must compete with the children of the wealthy. Deep down, they know that they probably can’t pass down the cultural and social class they once took for granted.

Quart cites a litany of grim statistics that measure the quality of their lives, like the fact that a middle-class existence is now 30% more expensive than it was twenty years ago, a period in which the price of health care and the cost of a four-year degree at a public college nearly doubled.

Squeezed is especially detailed on the plight of the female Middle Precariot, like those who have the effrontery to procreate or grow older. With the extra burdens of care work, pregnancy discrimination, inadequate family leave, and wage disparities, (not to mention sexual harassment, a subject not covered), women get double squeezed. For women of color, often lacking intergenerational wealth to ease the pain, make that a triple squeeze.

The Middle Precariot in middle age is not a pretty sight: without union protection or a reliable safety net they endure lost jobs, dwindled savings, and shattered identities. In one of the saddest chapters, Quart describes how the pluckiest try reinvent themselves in their 40s or 50s, enrolling in professional courses and certification programs that promise another shot at security, only to find that they’ve been scammed by greedy college marketers and deceptive self-help mavens who leave them more desperate than before.

Quart notes that even those making decent salaries in the United States now see themselves barred from the club of power and wealth. They may have illiquid assets like houses and retirement accounts, but they still see themselves as financially struggling. Earning $100,000 sounds marvelous until you’ve forked over half to housing and 30% to childcare. Each day is one bit of bad luck away from disaster.

“The spectacular success of the 0.1 percent, a tiny portion of society, shows just how stranded, stagnant, and impotent the current social system has made the middle class—even the 10 percent who are upper-middle class,” Quart writes.

Quart knows that the problems of those who seem relatively privileged compared many may not garner immediate sympathy. But she rightly notes that their stresses are a barometer for the concentration of extreme wealth in some American cities and the widening chasm between the very wealthy and everybody else.

The Dual Economy

The donor-fed establishment of both political parties could or would not see this coming, but some prescient economists have been sounding the alarm.

In his 2016 book The Vanishing Middle Class, MIT economist Peter Temin detailed how the U.S. has been breaking up into a “dual economy” over the last several decades, moving toward a model that is structured economically and politically more like a developing nation—a far cry from the post-war period when the American middle class thrived.

In dual economies, the rich and the rest part ways as the once-solid middle class begins to disappear. People are divided into separate worlds in the kinds of jobs they hold, the schools their kids attend, their health care, transportation, housing, and social networks—you name it. The tickets out of the bottom sector, like a diploma from a first-rate university, grow scarce. The people of the two realms become strangers.

French economist Thomas Picketty provided a stark formula for what happens capitalism is left unregulated in his 2015 bestseller, Capital in the Twenty-First Century. It goes like this: when the rate of return on the investments of the wealthy exceeds the rate of growth in the overall economy, the rich get exponentially richer while everyone becomes poorer. In more sensible times, like the decades following WWII, that rule was mitigated by an American government that forced the rich pay their share of taxes, curbed the worst predations of businesses, and saw to it that roads, bridges, public transit, and schools were built and maintained.

But that’s all a fading memory. Under the influence of political money, politicians no longer seek a unified economy and society where the middle class can flourish. As Quart observes, the U.S. is the richest and also the most unequal country in the world, featuring the largest wealth inequality gap of the two hundred countries in the Global Wealth Reportof 2015.

Who is to Blame?

Over and over, the people Quart interviews tend to blame themselves for their situation—if only they’d chosen a different career, lived in another city, maybe things wouldn’t have turned out this way. Sometimes they point the finger at robots and automation, though they arguably have much more to fear from the wealthy humans who own the robots.

But some are waking up to the fact it is the wealthy and their purchased politicians who have systematically and deliberately stripped them of power. Deprivations like paltry employee rights, inadequate childcare, ridiculously expensive health care, and non-existent retirement security didn’t just happen. Abstract words like deregulation and globalization become concrete: somebody actually did this to you by promoting policies that leave you high and dry.

As Quart indicates, understanding this is the first step to a change of consciousness, and her book is part of this shift.

Out of this consciousness, many individuals and organizations are working furiously and sometimes ingeniously to alter the negative trajectory of the Middle Precariot. Quart outlines proposals and developments like small-scale debt consolidation, student debt forgiveness, adequately subsidized day care, and non-traditional unions that could help.

America also has a track record of broad, fundamental solutions that have already proven to work. Universal basic income may sound attractive, but we already have a program that could improve the lot of the middle class if expanded: Social Security.

Right now, a worker stops having to pay Social Security tax on any earnings beyond $128,400—a number that is unreasonably low because the rich wish to keep it so. Just by raising that cap, we could the lower the retirement age so that Americans in their 60s would not have greet customers at Walmart. More opportunities would open up to younger workers.

The Middle Precariot could be forgiven for suspecting that the overlords of Silicon Valley may have something other than altruism in mind when they tout universal basic income. Epic tax evaders, they stand to benefit from pushing the responsibility for their low-paid workers and the inadequate safety net and public services that they helped create onto ordinary taxpayers.

Beyond basic income lies a basic fact: the American wealthy do not pay their share in taxes. In fact, American workers pay twice as much in taxes as wealthy investors. That’s why infrastructure crumbles, schools deteriorate, and sane health care and childcare are not available.

Most Americans realize that inequality has to be challenged through the tax code: a 2017 Gallup poll shows that the majority think that the wealthy and corporations don’t pay enough. Politicians, of course, ignore this to please their donors.

And so the Middle Precariot, like the Trump voters, is getting fed up with them.

From Depressed to Energized

Quart astutely points out that income inequality is being written into the law of the land. Funded the efforts of billionaires like the Koch brothers, politicians have altered laws and constitutions across the country to cement the dual economy through everything from restricting voting rights to defunding public education.

Several Middle Precariots in Squeezed have turned to independent or renegade candidates like Bernie Sanders who offer broad, substantial programs like debt-free college and universal health care that address the fissures in their lives. They are listening to candidates who are not afraid to say that markets should work for human beings, not the other way around.

If Donald Trump’s political rise “can be understood as an expression of the gulf between middle-class citizens and America’s ruling classes,” as Quart observes, then the recent surge of non-establishment Democratic candidates, especially democratic socialists, may be the next phase of a middle class revolt.

Recent surprise victories in Pennsylvania and New York in the Democratic primaries by female candidates openly embracing democratic socialism, including Alexandria Ocasio-Cortez, who bested Democratic stalwart Joe Crowley by running for Congress on a platform of free Medicare and public college tuition for all, may not be the blip that establishment Democrats hope. In New York, democratic socialist Julia Salazar is looking to unseat long-time state senator Martin Dilan. Actress Cynthia Nixon, running against New York Governor Andrew Cuomo, has just proclaimed herself a democratic socialist and promises to raise taxes on the rich and boost funding for public schools. Michelle Goldberg recently announced in the New York Times that “The Millenial Socialists are Coming,” indicating the intense dislike of traditional politics in urban centers. These young people do not think of things like debt-free college or paid family leave as radical: they see it done elsewhere in the world and don’t accept that it can’t be done in America.

Historically, the more affluent end of the middle class tends to identify with and support the wealthy. After all, they might join their ranks one day. But when this dream dies, the formerly secure may decide to throw their lot in with the rest of the Precariots. That’s when you have the chance for a real mass movement for change.

Of course, people have to recognize their common circumstances and fates. The urban denizens of New York and San Francisco have to see what they have in common with middle class Trump voters from the Rust Belt, as well as working class Americans and everybody else who is not ultra-rich.

If the growing ranks of Precariots can work together, maybe it won’t take a natural catastrophe or a war or violent social upheaval to change America’s unsustainable course of gross inequality. Because eventually, something has to give.

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https://www.alternet.org/taking-millennial-wealth-rich-white-boomers

Taking of Millennial Wealth By Rich White Boomers

The extreme level of inequality in the U.S. is battering the poor

By Paul Buchheit / AlterNet July 2, 2018, 5:14 AM GMT

Ten years after the recession, most Americans, including Baby Boomers, are still struggling with finances. The Wall Street Journal, cheerleader for capitalist-driven recoveries, noted that Millennials, Gen-Xers, and Boomers are all still poorer than in 2007. But the incredible prosperity of about 10% of the Boomers is beyond dispute, as the numbers below will show. Most of those lucky people are older whitemales.

Booming Economy? Yes, for the Richest 10%, Who Took 85 Percent of the New Wealth

In the past eight years, the 1% gained $6.75 million each, the 2-10% gained $700,000 each, and the poorest 50% of American adults LOST an average of $3,000 each. The bottom 50%, which includes most of the indebted Millennials, saw their average net worth fall to about $8,000. That's the average wealth of people in many developing nations. Part of the reason is the refusal by employers to pay a living wage. The wages of America's poorest 50% have remained stagnant since the recession, continuing a 40 year trend.

Most Millennials Have No Net Worth — or Worse

According to a Young Invincibles report, young adults who graduated college with student debt now have a median net worth of NEGATIVE $1,900. The College Investor calculates that the averageMillennial net worth for the Classes of 2010-17 runs into the NEGATIVE tens of thousands of dollars.

The "Deadbeat Millennial" Myth: Most Millennials Can't Even Afford an Apartment

Despite being better educated, Millennials are earning 20% less than Baby Boomers at the same age, in good part because "full employment" includes gig jobs that pay little more than half the wages of fulltime employees. In 2007 over 50 percent of college seniors had job offers waiting for them at graduation; ten years later fewer than 20 percent did. Planning for the future is generally out of the question. Two-thirds of 21- to 32-year-old Millennials have NOTHING saved for retirement.

As a result of all this hardship, more 25- to 29-year-olds live with their parents or grandparents than at any time in the past 75 years.

Rich White Boomer Individuals and Corporations have Redistributed the Profits from 75 Years of Prosperity

Writer Steven Brill describes the cunning ways of the well-positioned Boomers: "Ingenious financial and legal engineering turned our economy from an engine of long-term growth and shared prosperity into a casino with only a few big winners...They created exotic, and risky, financial instruments [that] separated those taking the risk from those who would bear the consequences...They were able to consolidate their winnings, outsmart and co-opt the forces that might have reined them in...The result is a new, divided America. On one side are the protected few – the winners – who don’t need government for much and even have a stake in sabotaging the government’s responsibility to all of its citizens...On the other side are the unprotected many."

The richest individuals and corporations have benefited from 75 years of public funding for the technologies that are now replacing working people with robots. Amazon depends mightily on our infrastructure; Apple on our phone innovations; Google on our Internet. All the 'modern' apps have their foundations in the basic research that is still largely funded by our tax dollars.

At the very least these companies should be paying their taxes, but Amazon paid NOTHING in 2017, and as of a year ago Apple and Google and Microsoft had tens of billions stashed away in overseas tax havens.

So how do the big corporations spend their massive profits? A trillion dollars in stock buybacks and dividends to enrich a decreasing number of shareholders. And extreme payoffs to the job eliminators. Sam Pizzigati gives the example of Hunter Harrison, former CEO of railroad giant CSX, who received a $230 million pay package to streamline the company, partly by cutting 17,000 jobs.

What To Do?

The Department for Professional Employees estimates that nearly 10 million service industry jobs will be added in the next decade. These jobs, especially the 'caring' jobs of health care and social assistance, will be of the greatest importance to our aging population, and to a nation that is beginning to understand the value of human cooperation in the pursuit of a stable society. They should be implemented as fulltime living-wage jobs. The corporate recipients of 75 years of public support should pay for them.

Paul Buchheit is the author of "Disposable Americans: Extreme Capitalism and the Case for a Guaranteed Income" (Routledge, 2017). His essays, videos and poems can be found at YouDeserveFacts.org.

https://www.alternet.org/news-amp-politics/trump-administration-now-has-fair-housing-its-crosshairs

Trump administration is trying to make it easier for banks, landlords and insurance companies to discriminate against minority homeowners and tenants.

Anna Maria Farías, an assistant secretary at HUD, is asking for comments on possible revisions that could “add clarity” and “reduce uncertainty” on a HUD rule based on a legal theory the Obama administration and its predecessors used to prove discrimination cases.

The theory, “disparate impact analysis,” measures discrimination, such as African-Americans paying higher interest rates on loans, without having to prove an intent to discriminate.

...

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app?

graph "consumer discretionary" biggest

https://www.bloomberg.com/graphics/ceo-pay-ratio/

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ceo pay, coca cola

https://www.alternet.org/shocker-tax-cuts-hand-ceos-admit-they-wont-invest-record-profits-worker-wage-hikes

dodd req corps post ceo pay ratio, mattell some huge # 5k%? mcD 3100:1? (that sector #1)

[// tort reform/ scotus kills class action --> arbitration]

https://www.democracynow.org/2018/5/23/we_are_lurching_toward_plutocracy_rep

dodd frank rollback (33 dems rolled, in trump states up for re-elect?

In a rare bipartisan effort Tuesday, House lawmakers voted 258 to 159 to exempt banks with less than $250 billion in assets from many of the 2010 Dodd-Frank Act regulations, even though banks’ profits are soaring. The Dodd-Frank Act was passed after the 2008 economic crisis, which was provoked by years of risky lending by Wall Street banks. Thirty-three Democrats joined their Republican counterparts in voting for the financial regulation rollback, which, if signed into law, would leave less than 10 banks in the U.S. subject to stricter federal oversight. For more, we speak with Minnesota Democratic Congressmember Keith Ellison. He is the first Muslim member of Congress and the deputy chair of the Democratic National Committee,

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amplify death spiral?

Shankar Vedantam

The researchers believe this is because politicians in gerrymandered districts are less likely to advocate for goods on behalf of their constituents.

5/1

https://www.npr.org/2018/05/01/607303602/in-gerrymandered-districts-constituents-likely-to-lose-economic-security

USA oligarch study:

https://www.vox.com/2016/5/9/11502464/gilens-page-oligarchy-study

...

I reached out to Gilens and Page (2014) to see what they made of the emerging critique of their work, and in particular the one included in the Bashir and Branham/Soroka/Wlezien papers.

Gilens made four main points. First, the definition of "rich" here is "at the 90th percentile of the income distribution." Households at the 90th percentile currently make $160,000 a year. They're rich, for sure, but not superrich. It's impractical to use surveys to measure the opinions of the ultra rich (millionaires, billionaires), but Gilens argues that their opinions would diverge from the middle class more dramatically. That might be, but it's somewhat orthogonal to the claims about the influence of the 90th percentile made in the original Gilens/Page paper.

Second, he insists that the issues where the rich win despite middle-class opposition are important ones relating to redistribution and economic policy. But Branham, Soroka, and Wlezien found that win rates for the rich weren't significantly different between economic and social issues.

Third, he writes that even though the middle class and rich agree on most things, "a political system that responds to the preferences of average citizens is profoundly different from one in which average citizens get their way only when they happen to agree with the preferences of the well to-do." This is a fair point, but again, the average citizen does not onlywin when they agree with the well-to-do. When they disagree, they win about half the time anyway.

Finally, Gilens argues that the use of "win rates" by Branham, Soroka, and Wlezien is misleading. By focusing on whether majorities of each group support a policy, they ignore gradations in the level of support. He also takes issue with them lumping in wins that consisted of a policy not passing — pretty common in a system with strong status quo bias, like American politics — with ones that consisted of a policy passing, a much rarer event:

When the rich (but not the middle-class) favor a policy, the policy is adopted 37 percent of the time; when the middle-class (but not the rich) favor a policy, the policy is adopted 26 percent of the time. Conversely, when the rich (but not the middle-class) oppose a policy, the policy fails 74 percent of the time and when the middle-class (but not the rich) oppose a policy, the policy fails 63 percent of the time."

In other words, the tiny gap in win rates gets somewhat wider when you break it down a little. Branham, Soroka, and Wlezien say this criticism misses the point. "While the rich do slightly better when explicitly taking into account the status quo, the rich still do not dominate the middle," they note. The middle class still gets its preferred policies enacted 26 percent of the time even when the rich are opposed. The picture Gilens and Page painted of a world where the opinions of the middle class literally count for nothing doesn't hold up.

"Our argument is not that American democracy is perfect," they say in a prepared response to Gilens. "Our paper responds to a specific claim made by Gilens and Page, namely, that when a majority of citizens disagrees with economic elites or with organized interests, they generally lose." That contention, they argue, is vastly overstated.

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heritage ~

https://www.heritage.org/poverty-and-inequality/commentary/no-america-not-oligarchy-run-the-ultra-rich

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TPM

new political science study that’s gone viral finds that majority-rule democracy exists only in theory in the United States — not so much in practice. The government caters to the affluent few and organized interest groups, the researchers find, while the average citizen’s influence on policy is “near zero.”

“[T]he preferences of economic elites,” conclude Princeton’s Martin Gilens and Northwestern’s Benjamin I. Page, who work with the nonprofit Scholars Strategy Network, “have far more independent impact upon policy change than the preferences of average citizens do.”

TPM spoke to Gilens about the study, its main findings and its lessons.

You published an advance copy of your study on April 9th, and in just the last few days there’s been an explosion of coverage and interest. Are you pleased, shocked, overwhelmed, all of the above?

I’m delighted to be able to contribute to a terribly important public discussion. And I’m thrilled that there’s so much interest and concern about the issues. It takes on a life of its own. I’m sure you’ve noticed, this notion of America being an oligarchy seems to be a dominant meme in the discussion of our work. It’s not a term that we used in the paper. It’s just a dramatic sort of overstatement of our findings. So it’s been interesting for me. Typically my work is read by a few dozen political scientists and I don’t get this kind of response.

Let’s talk about the study. If you had 30 seconds to sum up the main conclusion of your study for the average person, how would you do so?

I’d say that contrary to what decades of political science research might lead you to believe, ordinary citizens have virtually no influence over what their government does in the United States. And economic elites and interest groups, especially those representing business, have a substantial degree of influence. Government policy-making over the last few decades reflects the preferences of those groups — of economic elites and of organized interests....

krugman AN

GOP is a party of cons, in both senses of the word, writes Paul Krugman in his Thursday column. First, there are four actual convicts running in Republican primaries for the 2018 midterms. One is Don Blankenship, the former CEO of Massey Energy, best known for his role in a 2010 coal mine explosion that left 29 people dead. He went to prison in 2015, but got out in time to run for Senate.

The second kind of con is that the GOP has been duping the American people for a generation in order to maintain its grip on power.

The two are interrelated. As Krugman notes, “the success of people like Blankenship—or Trump— was an inevitable consequence of the political strategy Republicans have followed for decades. For the simple truth is that ever since Reagan, Republicans have basically played a con game on American voters.”

Republicans' entire strategy is based on “the upward distribution of wealth,” taking from the poor to give to the rich and convincing the former they should be grateful for it. The worst part is, “Only a small minority of Americans wants to see tax cuts for the wealthy, and an even smaller minority wants cuts to major social programs.” That hasn't stopped Republicans, who win elections by “posing as defenders of traditional social values—above all, that greatest of American traditions, racism.”

Because of this, Krugman continues, “Trumpism was more or less fated to happen.” In fact, it was part of the plan all along: “Trump’s crude racism and blatant dishonesty are only exaggerated versions of what his party has been selling for decades, while his substantive policy agenda—slashing taxes on corporations and the wealthy, taking health care away from lower-income families—is utterly orthodox.”

The consequences for the future of our democracy are dire if we don’t take action. First, Krugman admonishes us that we should abandon the hope that so-called principled conservatives will hold their president to account. Second, and perhaps a little more reassuring, we must recognize that the Republican Party has never been more vulnerable. Even if the GOP is running actual, convicted criminals for Congress, Krugman notes, “Republican attacks on health care, not lurid scandals, seem to have been the biggest factor behind Democratic victories in special elections. And in November this backlash could give Democrats not just one or both houses of Congress, but also control of many state governments.”

And if we don’t campaign our hearts out and urge friends and family to do the same? Well, Krugman has an even scarier message:

The nature of the modern G.O.P.’s game gives it a bias against democracy. After all, one way to protect yourself against voters who figure out what you’re up to is to stop them from voting. Vote suppression and extreme gerrymandering are already key parts of Republican strategy, but what we’ve seen so far may be just the beginning.

And if you think that G.O.P. leaders would balk at gross electoral manipulation, you haven’t been paying attention.

Read the entire column.

https://www.alternet.org/news-amp-politics/thomas-piketty-sees-only-one-way-defeat-rise-radical-right

In a new paper, French political economist Thomas Piketty, author of the bestselling 2013 book "Capital in the Twenty-First Century," argues that Western political parties on the right and left have both become parties of the "elites."

Yet the 65-page paper from the notoriously punctilious economist — titled "Brahmin Left vs. Merchant Right: Rising Inequality & the Changing Structure of Political Conflict" — is more surprising for the lessons it has for the political left in the Western world. Indeed, the left-populist wing of Western political parties, including the American progressive movement restarted by Bernie Sanders, has reason to celebrate: Piketty's paper aligns with their somewhat counterintuitive strategy that shifting the Democratic Party platform more to the left is actually a winning electoral strategy that can help bring back disenfranchised working-class voters and less educated voters who currently may not vote at all or identify with right-wing populism.

"Using post-electoral surveys from France, Britain and the US, this paper documents a striking long-run evolution in the structure of political cleavages," Piketty writes in the abstract. He goes on to explain the political changes that have happened since the 1950s and 1960s, when "the vote for left-wing (socialist-labour-democratic) parties was associated with lower education and lower income voters" — in other words, the Labour Party of the United Kingdom, the Socialist Party of France and the Democratic Party of the United States were considered parties that supported and helped destitute and less-well-educated voters.

Yet over time, those parties, Piketty explains, "gradually become associated with higher education voters," which he describes as creating a system of "multiple-elite" parties where "high-education elites now vote for the 'left,' while high-income/high-wealth elites still vote for the 'right' (though less and less so)." In other words, both sides of the spectrum became parties of the elite, with no party for less educated folks or the working class.

Piketty argues that this situation "contributes to rising inequality and lack of democratic response to it," as well as the rise of populists like Trump, Marine Le Pen in France and Nigel Farage in Britain. "Without a strong egalitarian-internationalist platform, it is difficult to unite low- education, low-income voters from all origins within the same party," he writes.

If the Democratic Party were wise, it might see Piketty's paper as a chance to improve its electoral strategy. Indeed, the Democrats seem to be locked in a battle for their soul, a fight long-presaged that erupted during the 2016 presidential primary. In one corner sits the Clintonite corporate wing of the party, who believe that the key to Democratic Party strategy is to move to the center in order to pick up moderate conservatives voters who feel left behind by the Republican Party's far-right shift.

This was Clinton's strategy to a T: in her election campaign, she bragged about her connections to Henry Kissinger and her support from billionaire Republicans like former eBay CEO Meg Whitman, while being famously dismissive of social democratic policies like single-payer health care.

In the other corner there are those who argue that the Democratic Party will win more voters if it appeals explicitly to class interests and concerns. As Steve Phillips wrote in a Times op-ed last year:

This "go left" strategy hints at what Piketty calls the "class-based party system" that dominated Western democracies in the 1950s and 1960s. In those decades, "lower class voters from the different dimensions (lower education voters, lower income voters, etc.) tend[ed] to vote for the same party or coalition, while upper and middle class voters from the different dimensions tend[ed] to vote for the other party or coalition."If Democrats had stemmed the defections of white voters to the Libertarian or Green Parties, they would have won Michigan and Wisconsin, and had they also inspired African-Americans in Pennsylvania, Mrs. Clinton would be president.

If progressive whites are defecting because they are uninspired by Democrats, moving further to the right will only deepen their disillusionment.

Similar as the Democratic factions may seem to the right, which seems unable to distinguish a liberal billionaire like Warren Buffett from a "communist," they represent radically different positions, and have different constituencies. The Clintonite coalition tended to rely on pandering to identity groups and a sort of vague multiculturalism that posited that billionaires, corporations and the poor could live in some kind of perfect harmony, even though the former rely on the exploitation of the latter to exist.

Critics like Phillips argue that Clinton and her DNC lackeys failed to grasp that her milquetoast liberalism lacked a comprehensible ideology: There were no scapegoats, and "America was already great," in Clinton's words. Those words appeared tone-deaf to the millions of Americans struggling to make ends meet, who sought a scapegoat and heard a more sensible explanation for their woes from Donald Trump.

Though Sanders came up short in the primaries, he was vindicated in the aftermath of the general election in several ways: First, many of the Rust Belt states that Trump carried — states Hillary Clinton had banked on winning — were won by Sanders in the primary, including Michigan and Wisconsin. Second, post-election studies suggested that had Sanders been the Democratic nominee, he would have defeated Trump by a wide margin. Third, Sanders remains the most popular politician in the United States, despite an ongoing bile-spitting campaign orchestrated by Democratic insiders like Sally Albright (who called Sanders "racist" for proposing free college) or Peter Daou (who blames Sanders for Clinton's loss). Finally, Clinton's victory was aided considerably by a corrupt party apparatus that was already in the bag for Clinton, as former interim DNC chair Donna Brazile has described.Meanwhile, the strategy of Bernie Sanders — mirrored in other left organizing groups in the United States that seek to push the Democratic Party to the left, including Our Revolution and Democratic Socialists of America — is to offer a more serious material analysis of the underpinnings of oppression and suffering in the United States, and to scapegoat income inequality caused by an unjust economic system propped up by the elite. Sanders and his counterparts overseas, particularly U.K. Labour Party leader Jeremy Corbyn, offer that aforementioned "strong egalitarian-internationalist platform" that has the potential to "unite low-education, low-income voters from all origins," as Piketty describes.

For Berniecrats, democratic socialists and those even further left, there's much to love in Piketty's paper. His conclusion, one echoed by the Sanders wing of the Democratic party, is essentially that ostensibly "left" parties — e.g. the Democrats in the United States, Labour in the U.K. or the Socialist Party in France — have lost the constituencies they once supported and now appeal to the elite, leaving a vast underclass politically unrepresented and rudderless. Piketty is giving them a rudder, if the parties can seize it.

wolff says via oxfam that increase in uber wealth 4k billioaires wd lift all out of extreme poverty 1.90/day

https://www.oxfam.org/en/pressroom/pressreleases/2018-01-22/richest-1-percent-bagged-82-percent-wealth-created-last-year

Richest 1 percent bagged 82 percent of wealth created last year - poorest half of humanity got nothing

Published: 22 January 2018

Eighty-two percent of the wealth generated last year went to the richest one percent of the global population, while the 3.7 billion people who make up the poorest half of the world saw no increase in their wealth, according to a new Oxfam report released today. The report is being launched as political and business elites gather for the World Economic Forum in Davos, Switzerland.

‘Reward Work, Not Wealth’ reveals how the global economy enables a wealthy elite to accumulate vast fortunes while hundreds of millions of people are struggling to survive on poverty pay.

Billionaire wealth has risen by an annual average of 13 percent since 2010 – six times faster than the wages of ordinary workers, which have risen by a yearly average of just 2 percent. The number of billionaires rose at an unprecedented rate of one every two days between March 2016 and March 2017.

It takes just four days for a CEO from one of the top five global fashion brands to earn what a Bangladeshi garment worker will earn in her lifetime. In the US, it takes slightly over one working day for a CEO to earn what an ordinary worker makes in a year.

It would cost $2.2 billion a year to increase the wages of all 2.5 million Vietnamese garment workers to a living wage. This is about a third of the amount paid out to wealthy shareholders by the top 5 companies in the garment sector in 2016.

Oxfam’s report outlines the key factors driving up rewards for shareholders and corpo

...

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https://www.patreon.com/economicupdate

oxfam 2k = bottom 50%

tax cut: 28k 60$, u MC 900$; 3.4 m 200K$ back

https://kpfa.org/episode/economic-update-march-23-2018/

https://www.youtube.com/channel/UCK-6FjMu9OI8i0Fo6bkW0VA

2 studies

* An astonishing report: "Black boys raised in America, even in the wealthiest families and living in some of the most well-to-do neighborhoods, still earn less in adulthood than white boys with similar backgrounds, according to a sweeping new study that traced the lives of millions of children."

https://www.alternet.org/news-amp-politics/income-inequality-us-even-worse-youve-been-led-believe

Income Inequality in the U.S. Is Even Worse Than You've Been Led to Believe

Data show the country is failing its lower and middle-income earners miserably.

robert mcilvane

https://www.amazon.com/Great-Depression-America-1929-1941/dp/0812923278

https://kpfa.org/episode/letters-and-politics-december-4-2017/

gt dep recession // 22 min in

tax "reform"

https://www.propublica.org/article/tax-plan-mega-gift-richest-trump-appointees

~ ACA stealth

9/17 counties around capitol are richest, more than silly vly

https://www.forbes.com/sites/rebeccalerner/2017/07/13/top-10-richest-counties-in-america-2017/

Here’s one way to follow the money in the United States: look past the Washington Monument and the Capitol to the D.C. suburbs. Half of the richest counties in America are roughly an hour away from the capital.

Virginia’s Loudoun County boasts an eye-popping median household income of $125,900, tops in the nation, according to 2015 Census Bureau estimates, the most recent available. Almost 10,000 Loudoun residents commute to D.C., but the vast majority of residents find plentiful well-paid job opportunities close to home – the top local employers are Dulles Airport, the Department of Homeland Security and the Loudoun County Public Schools.

Loudoun County also houses a large amount of technology companies and data centers — up to 70% of the world’s Internet traffic flows through Loudoun’s data centers each day.

In second place is its Virginia neighbor Falls Church City, a small city encompassing just 2.2 square miles that has previously topped the list of wealthiest counties. The vast majority, 78.8%, of Falls Church adult residents have a bachelor’s degree or higher. Though technically an independent city, Falls Church is considered by the Census Bureau to be equivalent to a county. It’s a government town: 31.3% of Falls Church residents are employed by Uncle Sam.

Other D.C. suburbs with high earning include Virginia’s Fairfax and Arlington counties and Howard County in Maryland. The long arm of government spending is also fueling high incomes in Los Alamos County, N.M., sixth on the list this year and home to the Los Alamos National Laboratory.

The high median incomes of most of the counties on our list are not due to a wealthy few masking a lower-earning population. In both Falls Church and Colorado's Douglas County, the poverty rate is a scant 4%, compared to the national rate of 13.5%, with most counties on the list falling between 4% and 6%. Only Arlington County, Va., and Santa Clara County, Calif., had higher poverty rates, at 9% and 9.5%, respectively.

https://www.bisnow.com/national/news/commercial-real-estate/where-the-rich-folks-live-these-are-the-wealthiest-towns-in-the-country-72707#0 eh

http://www.alternet.org/education/story-behind-jared-kushners-curious-acceptance-harvard

http://www.alternet.org/environment/half-global-population-could-face-unknown-climates-mid-century

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bernie: ==

http://www.alternet.org/economy/bernie-sanders-right-wing-ideology-rules-our-economy

For over 40 years, In These Times has published incisive reporting and analysis on one of the defining issues of our time: the crisis of inequality. Our new book, The Age of Inequality: Corporate America’s War on Working People, brings together In These Times’ best writing on the topic from leading thinkers and journalists. In this selection, originally published in 2009, Bernie Sanders writes about the intellectual failures, and simultaneous political success, of the “Chicago School’s” greatest avatar, Milton Friedman.

“THE FAILED PROPHET” (2009)

THE LATE MILTON FRIEDMAN WAS A PROVOCATIVE TEACHER AT MY ALMA MATER, THE UNIVERSITY OF CHICAGO. He got his students involved with their studies. He was a gifted writer and communicator. And he received a Nobel Prize for his contributions to economics.

But Friedman was more than an academic. He was an advocate for, and popularizer of, a radical right-wing economic ideology.

In today’s political and social reality, the University of Chicago’s establishment of a $200 million Milton Friedman Institute (in the building that until now has housed the renowned Chicago Theological Seminary) will not be perceived as simply a sign of appreciation for a prominent former faculty member. Instead, by founding such an institution, the university signals that it is aligning itself with a reactionary political program supported by the wealthiest, greediest, and most powerful people and institutions in this country. Friedman’s ideology caused enormous damage to the American middle class and to working families here and around the world. It is not an ideology that a great institution like the University of Chicago should be seeking to advance.

Those who defend the Milton Friedman Institute will assure us that it will encourage a free and open exchange of ideas. That may very well be true. But if the goal of the institute is simply to do nonideological research, there are a lot of names that one could come up with other than that of the most polemical and ideological economist of his time.

My suspicions only deepen when I read on the University of Chicago website that donors who contribute more than $1 million to the project will have a special relationship with the institute as members of a Milton Friedman Society and will be expected to facilitate the institution’s “connections to leaders in business and government.”

I work in Washington, D.C., and I know about the power that big money has over process. When the insurance companies and the drug companies and the oil companies and the banks and the military-industrial complex make contributions to political campaigns, we usually know exactly what it is they want in return.

The timing of this project is a little ironic. Friedman earned his bread by denouncing government at virtually every turn. He, like his acolyte, former Federal Reserve Chair Alan Greenspan, believed that a largely unregulated free market constituted the most superior form of economic organization imaginable. Well, the tune of the right-wing free marketeers has changed a bit in the last few months.

My colleagues in the Senate and I are now picking up the pieces of a banking system brought to the edge of collapse by this theory of deregulation and by the insatiable greed of a small number of wealthy financiers playing in the market and engaging in incredibly risky—if not illegal—behavior.

In the rush to bail out Wall Street, we saw President Bush, Treasury Secretary Henry Paulson, the people in the U.S. Chamber of Commerce and the Business Roundtable—folks who loved Friedman’s ideas and who, no doubt, would be prepared to financially support a Milton Friedman Institute—reverse their longstanding rhetorical opposition to government intervention.

Instead, they demanded that we come to the rescue of the financial firms that had lined up in front of Congress for their emergency welfare checks.

For years, all of these people, including the president of the United States, have been telling us that government should not be involved in ensuring health care for all Americans as a right of citizenship. (“What a terrible idea!”) They have been telling us that the government should not be involved in making quality education affordable to all people; that the government should not be empowered to ensure that we reverse greenhouse gas emissions; that the government should not regulate pollution that contaminates our air and water and land; and that the government should not provide a strong safety net for our children, for our seniors, or for the disabled.

But the issue here is not just economic policy. It goes deeper than that. It touches on the core of who we are as a society and as a people. Are we as human beings supposed to turn around and not see the suffering that so many of our brothers and sisters are experiencing? Are we content to be living in a nation where, thanks in part to the Friedmanite ideology, the richest 1 percent owns more than the bottom 90 percent and the top one-tenth percent owns more than the bottom 50 percent?Well, it turns out that when the shoe is pinching their foot, they have become the strongest believers in government intervention—especially if working people and the middle class are bailing them out.

With all due respect to the late Milton Friedman, his economic program is nothing more than a wish list for the greediest, the most monied interests in our society. At the same time that this ideology is supported by the rich and powerful—except when they’re lining up in Washington for their welfare checks—this same ideology is almost unanimously opposed by working families and middle-class people across this country.

What would some of the items on Friedman’s wish list be? First of all, the Friedmanites would be supportive of the concept of a culture of greed. They want people making billions of dollars on the covers of Time and Newsweek because these people are supposed to be our national heroes. We are not supposed to recognize a teacher who makes $40,000 a year opening up the minds of young people. We are not supposed to recognize a childcare worker who makes $18,000 a year giving poor children an opportunity to grow intellectually and emotionally. Those jobs are not considered important work.

But if you’re a billionaire on Wall Street creating exotic financial instruments that end up being worth nothing, you are considered a hero. The fact that this culture of greed has permeated our political culture means that corporate CEOs can now earn more than 400 times what their workers earn without fearing a political backlash.

Now we have a case study for what happens when the ideology of Milton Friedman becomes the operating ideology of the government. Under Bush, the median family income has declined by thousands of dollars. Millions of Americans have entered the ranks of the poor. Some 7 million have lost their health insurance. Some 3 million have lost their pensions. And the gap between the very rich and everybody else has grown much wider.

Our country is due for a transformation. We have endured years of right-wing ideology, and we are eager to move in a different direction. I believe that we will see a major reordering of social and economic priorities and that this last general election represented a repudiation of right-wing economic arguments.

In the Bush era—a period in which some of Friedman’s greatest admirers managed the U.S. economy—the top 400 families in this country saw their wealth increase by $670 billion.

Yet we have children in this country who have no health care, children who are undernourished, and children who sleep out on the streets. From an economic perspective, from a moral perspective, and from a philosophical perspective, the ideology of Milton Friedman is dead wrong.

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http://www.alternet.org/environment/3-ways-climate-change-will-have-unequal-economic-impacts-across-us

recent study confirms what many have known: Climate change won’t impact all U.S. states equally.

The report's 12 authors, some from the University of Berkeley and Princeton University, published the study in the journal Science, where they investigate the different economic gains and losses states across the United States will see in 2088 to 2099.

The sectors the researchers analyzed, including crime and labor, will see their damage value increase with the global mean temperature. This translates to a 1.2 percent loss in gross domestic product (GDP) per every Celsius degree increase, on average, the study says. Some states will benefit from climate change as their typically brisk temperatures increase while warm states see loss as their climates worsen.

The study relies on economic losses from the past, which could shift with changing technologies. It also does not look at how migration patterns may change in the future as popular locations like Arizona and Texas become less appealing as a result of their climbing temperatures.

County-level median values for average 2080 to 2099 impacts. This map shows median total direct economic damage across all sectors. Courtesy of "Science," Estimating economic damage from climate change in the United States.

Here, three main takeaways from the study.

The mortality rate will shift

Fewer cold-related deaths will hit the Northern states as they warm. Already-hot Southern states, in contract, will have more deaths. Maps in the analysis show increases of 40 to 80 deaths per 100,000 in the Southeast while deaths in the Northeast will decrease by roughly 20 to 60 per 100,000.

The study determines that if temperatures increase past 2.5 degrees Celsius, the U.S. will experience “excess mortality” from the changes in agricultural production and labor supply—a sector largely made up of Latinx immigrant farmers who are paid some of the lowest wages in the U.S., per United States Department of Agriculture.

The U.S. mortality rate will increase by 0.5 deaths per 100,000, as the decrease in the North and increase in the South should nearly level out.

Economic loss will be greatest where many people of color live: the South and Midwest

The South, however, is home to most of the nation’s poorest Black communities. The Midwest is too. It’s also where the majority of poor Native American families live.Northern and Western will see fewer losses—or even benefits, as noted above. The same does not hold true for the Midwest or South.

In the South, people have already felt what these impacts will look like: $1 billion+ hurricanes from which the federal government won’t help states rebuild. The Midwest doesn’t have hurricanes, but it does experience severe flooding and powerful wildfires.

In the Southwest, home to Latinx border communities, GDP loss will range from 10 to 15 percent. The same goes for Florida.

This translates to greater income inequality

The authors told The New York Times that “climate change tends to increase pre-existing inequality.” As noted above, the nation's poorest regions will see some of the worst impacts.

The richest counties will likely feel the least amount of damage as a percentage of their county income. The poorest ones will likely be most damaged, but their data is less definitive, as The New York Times shows.

Check out The New York Times breakdown of the study to visualize these effects in maps and charts here.

Yes, inequality is getting worse every year. In early 2016 Oxfam reported that just 62 individuals had the same wealth as the bottom half of humanity. About a year later Oxfam reported that just 8 men had the same wealth as the world’s bottom half. Based on the same methodology and data sources used by Oxfam, that number is now down to 6.

How to account for the dramatic increase in the most flagrant and perverse of extreme inequalities? Two well-documented reasons: (1) The poorest half (and more) of the world has continued to lose wealth; and (2) The VERY richest individuals – especially the top thousand or so – continue to add billions of dollars to their massive fortunes.

Inequality deniers and apologists say the Oxfam methodology is flawed, but they’re missing the big picture. Whether it’s 6 individuals or 62 or 1,000 doesn’t really matter. The data from the Credit Suisse Global Wealth Databook (GWD) and the Forbes Billionaire List provide the best available tools to make it clear that inequality is extreme and pathological and getting worse every year.

How it’s gone from 62 to 6 in one year

As of 02/17/17, the world’s 6 richest individuals (all men) had $412 billion. Tables 2-4 and 3-4 of the 2016 GWD reveal that the poorest five deciles of the world population own just .16% of the $256 trillion in global wealth, or $410 billion. That latter figure is based on mid-2016 data, but since then the status of the bottom 50% has not improved, and has in fact likely worsened, as both global debt and global inequality have increased.

Just a year ago, on 03/01/16, the world’s 6 richest men had $343 billion. They’re the same men today, although slightly rearranged as they play “king of the hill”: Bill Gates, Warren Buffett, Jeff Bezos, Amancio Ortega, Mark Zuckerberg, Carlos Slim Helu (with Larry Ellison jockeying for position). The wealth of these six men increased by $69 billion in just one year.Just a year ago, according to the 2015 GWD, the poorest five deciles of the world population owned much more than today, close to $1.5 trillion. What happened? It’s very clear: the world’s richest 10% (mostly the richest 1%) gained nearly $4 trillion while every other segment of the global population lost wealth.

That’s worth a second look. The world’s total wealth is about $256 trillion, and in JUST ONE YEAR the richest 10% drained nearly $4 trillion away from the rest of civilization.

It’s not just the bottom half: A 500-seat auditorium could hold as much wealth as 70% of the world’s population

According to the Forbes Billionaire List, the world’s richest 500 individuals have $4.73 trillion in wealth. Tables 2-4 and 3-4 of the GWD reveal that the poorest seven deciles of the world population own just 1.86% of the $256 trillion in global wealth, or $4.76 trillion. That’s over two-thirds of all the people on earth. That means 5,000,000,000 people – FIVE BILLION people – have, on average, and after debt is figured in, about a thousand dollars each in home and property and savings.

In the U.S., the Forbes 400 own as much as 3/5 of the American people

The bottom 60% of Americans, according to Table 6-5 in the GWD, own 3 percent of the nation’s $85 trillion in total wealth, or $2.55 trillion. The Forbes 400 owned $2.4 trillion in October 2016, and that’s been steadily increasing.

So as apologists like the National Review refer to “a growing upper-middle class” of people earning over $100,000 a year, they’re inadvertently offering an explanation for the demise of the middle class: Some are moving up, way up; many others are dropping to the lower-middle-class or below. The once sizable and stable middle of America is splitting into two.

The deniers are lurking

The Boston Globe’s Jeff Jacoby calls the Oxfam analysis “irrelevant.” Reuters contributor Felix Salmon calls it a “silly stat.”

Jacoby’s column includes some stunning assertions. He says, “Just as capitalism made it possible for Gates, Zuckerberg, and the others to reach the highest rung on the economic ladder, it is making it possible for billions of men and women to climb up from the lowest rung. Oxfam’s billionaires are richer than they used to be. So is almost everyone else.” And he quotes writer Johan Norberg: “Poverty as we know it is disappearing from our planet.” Billions moving up? Almost everyone getting richer? Poverty disappearing?

NationofChange is a nonprofit organization, and this website is funded by readers like you. Please support our work. Donate or give monthly.

While we keep hearing about the world “climbing out of poverty,” much of the alleged improvement is due to rapid economic growth in China and creative math on the part of the UN. And yes, many Americans have negative wealth because of debt. A human being doesn’t have to live in a third-world slum to be impoverished.

Yet as inequality ravages the American and world economies, denial grows right along with it. Cato’s Michael Tanner suggests that “even if inequality were growing as fast as critics claim, it would not necessarily be a problem.” George Will, of course, agrees. But like the other deniers, they all protest too much as they try to explain away reality.

https://www.commondreams.org/views/2017/06/12/now-just-five-men-own-almost-much-wealth-half-worlds-population

Last year it was 8 men, then down to 6, and now almost 5.

While Americans fixate on Trump, the super-rich are absconding with our wealth, and the plague of inequality continues to grow. An analysis of 2016 data found that the poorest five deciles of the world population own about $410 billion in total wealth. As of 06/08/17, the world's richest five men owned over $400 billion in wealth. Thus, on average, each man owns nearly as much as 750 million people.

Why Do We Let a Few People Shift Great Portions of the World's Wealth to Themselves?

Most of the super-super-rich are Americans. We the American people created the Internet, developed and funded Artificial Intelligence, and built a massive transportation infrastructure, yet we let just a few individuals take almost all the credit, along with hundreds of billions of dollars.

Defenders of the out-of-control wealth gap insist that all is OK, because, after all, America is a 'meritocracy' in which the super-wealthy have 'earned' all they have. They heed the words of Warren Buffett: "The genius of the American economy, our emphasis on a meritocracy and a market system and a rule of law has enabled generation after generation to live better than their parents did."

But it's not a meritocracy. Children are no longer living better than their parents did. In the eight years since the recession the Wilshire Total Market valuation has more than TRIPLED, rising from a little over $8 trillion to nearly $25 trillion. The great majority of it has gone to the very richest Americans. In 2016 alone, the richest 1% effectively shifted nearly $4 trillion in wealth away from the rest of the nation to themselves, with nearly half of the wealth transfer ($1.94 trillion) coming from the nation's poorest 90%—the middle and lower classes. That's over $17,000 in housing and savings per lower-to-middle-class household lost to the super-rich.

A meritocracy? Bill Gates, Mark Zuckerberg, and Jeff Bezos have done little that wouldn't have happened anyway. ALL modern U.S. technology started with—and to a great extent continues with—our tax dollars and our research institutes and our subsidies to corporations.

Why Do We Let Unqualified Rich People Tell Us How To Live? Especially Bill Gates!

In 1975, at the age of 20, Bill Gates founded Microsoft with high school buddy Paul Allen. At the time Gary Kildall's CP/M operating system was the industry standard. Even Gates' company used it. But Kildall was an innovator, not a businessman, and when IBM came calling for an OS for the new IBM PC, his delays drove the big mainframe company to Gates. Even though the newly established Microsoft company couldn't fill IBM's needs, Gates and Allen saw an opportunity, and so they hurriedly bought the rights to another local company's OS -- which was based on Kildall's CP/M system. Kildall wanted to sue, but intellectual property law for software had not yet been established. Kildall was a maker who got taken.

So Bill Gates took from others to become the richest man in the world. And now, because of his great wealth and the meritocracy myth, MANY PEOPLE LOOK TO HIM FOR SOLUTIONS IN VITAL AREAS OF HUMAN NEED, such as education and global food production.

—Gates on Education: He has promoted galvanic skin response monitors to measure the biological reactions of students, and the videotaping of teachers to evaluate their performances. About schools he said, "The best results have come in cities where the mayor is in charge of the school system. So you have one executive, and the school board isn’t as powerful."

—Gates on Africa: With investments in or deals with Monsanto, Cargill, and Merck, Gates has demonstrated his preference for corporate control over poor countries deemed unable to help themselves. But no problem—according to Gates, "By 2035, there will be almost no poor countries left in the world."

Warren Buffett: Demanding To Be Taxed at a Higher Rate (As Long As His Own Company Doesn't Have To Pay)

Warren Buffett has advocated for higher taxes on the rich and a reasonable estate tax. But his company Berkshire Hathaway has used "hypothetical amounts" to 'pay' its taxes while actually deferring $77 billion in real taxes.

Jeff Bezos: $50 Billion in Less Than Two Years, and Fighting Taxes All the Way

Since the end of 2015 Jeff Bezos has accumulated enough wealth to cover the entire $50 billion U.S. housing budget, which serves five million Americans. Bezos, who has profited greatly from the Internet and the infrastructure built up over many years by many people with many of our tax dollars, has used tax havens and high-priced lobbyists to avoid the taxes owed by his company.

Mark Zuckerberg (6th Richest in World, 4th Richest in America)

While Zuckerberg was developing his version of social networking at Harvard, Columbia University students Adam Goldberg and Wayne Ting built a system called Campus Network, which was much more sophisticated than the early versions of Facebook. But Zuckerberg had the Harvard name and better financial support. It was also alleged that Zuckerberg hacked into competitors' computers to compromise user data.

Now with his billions he has created a 'charitable' foundation, which in reality is a tax-exempt limited liability company, leaving him free to make political donations or sell his holdings, all without paying taxes.

Everything has fallen into place for young Zuckerberg. Nothing left to do but run for president.

The False Promise of Philanthropy

Many super-rich individuals have pledged the majority of their fortunes to philanthropic causes. That's very generous, if they keep their promises. But that's not really the point.

American billionaires all made their money because of the research and innovation and infrastructure that make up the foundation of our modern technologies. They have taken credit, along with their massive fortunes, for successes that derive from society rather than from a few individuals. It should not be any one person's decision about the proper use of that wealth. Instead a significant portion of annual national wealth gains should be promised to education, housing, health research, and infrastructure. That is what Americans and their parents and grandparents have earned after a half-century of hard work and productivity.

According to Oxfam’s new report, eight men own the same wealth as the 3.6 billion people who make up the poorest half of humanity: The gap between rich and poor is far greater than had previously been estimated, with big business and the super-rich fueling the inequality crisis by dodging taxes, driving down wages, and using their power to influence politics. 1/17. see Economicsand Food Scarcity.

inequality --> instability:

Robert Reich Saving Capitalism video *** Robert Bernard Reich (/'ra??/;[1] born June 24, 1946) is an American political economist, professor, author, and political commentator. He served in the administrations of Presidents Gerald Ford and Jimmy Carter and was Secretary of Labor under President Bill Clinton from 1993 to 1997. Reich is currently Chancellor's Professor of Public Policy at the Goldman School of Public Policy at the University of California, Berkeley. He was formerly a professor at Harvard University's John F. Kennedy School of Government... He has published 14 books, including the best-sellers The Work of Nations, Reason, Supercapitalism, Aftershock: The Next Economy and America's Future, and a best-selling e-book, Beyond Outrage. He is also chairman of Common Cause and writes his own blog about the political economy at Robertreich.org.[7] The Robert Reich – Jacob Kornbluth film Inequality for All won a U.S. Documentary Special Jury Award. Robert B. Reich: Technological Change and the Inevitability of Unconditional Basic Income 2016. no one will be able to afford the ieverything magic box, unions 7%, 20% gig economy. 2/3rd work paycheck to paycheck;

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gladwell ny 2010 1975 magic year

https://www.youtube.com/watch?v=iKvFlSedpNI

According to Oxfam’s new report Switzerland, eight men own the same wealth as the 3.6 billion people who make up the poorest half of humanity: The gap between rich and poor is far greater than had previously been estimated, with big business and the super-rich fueling the inequality crisis by dodging taxes, driving down wages, and using their power to influence politics. 1/17. see Economics and Food Scarcity.

*** summary: https://www.oxfamamerica.org/static/media/files/bp-economy-for-99-percent-160117-summ-en.pdf

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12/16

http://www.nytimes.com/2016/12/07/business/economy/portland-oregon-tax-executive-pay.html?_r=0

Moving to address income inequality on a local level, the City Council in Portland, Ore., voted on Wednesday to impose a surtax on companies whose chief executives earn more than 100 times the median pay of their rank-and-file workers.

The surcharge, which Portland officials said is the first in the nation linked to chief executives’ pay, would be added to the city’s business tax for those companies that exceed the pay threshold. Currently, roughly 550 companies that generate significant income on sales in Portland pay the business tax.

Under the new rule, companies must pay an additional 10 percent in taxes if their chief executives receive compensation greater than 100 times the median pay of all their employees. Companies with pay ratios greater than 250 times the median will face a 25 percent surcharge.

The tax will take effect next year, after the Securities and Exchange Commission begins to require public companies to calculate and disclose how their chief executives’ compensation compares with their workers’ median pay. The S.E.C. rule was required under the Dodd-Frank legislation enacted in 2010.

Portland’s executive-pay surcharge will be levied as a percentage of what a company owes on the city’s so-called business license tax, which has been in place since the 1970s. City officials estimated that the new tax would generate $2.5 million to $3.5 million a year for the city’s general fund, which pays for basic public services such as housing and police and firefighter salaries.

Criticism of how much chief executives are paid has risen in recent years as their compensation has grown substantially. In 2015, the median compensation for the 200 highest-paid executives at public companies in the United States was $19.3 million, up from $9.6 million five years earlier.

Comparing such compensation with how much lower-level employees earn is likely to show a very wide gulf. A 2014 study by Alyssa Davis and Lawrence Mishel at the Economic Policy Institute, a liberal-leaning advocacy group in Washington, found that chief executive pay compared with the earnings of average workers had surged from a multiple of 20 in 1965 to almost 300 in 2013.

Thomas Piketty, a professor at the Paris School of Economics and an authority on income inequality who wrote “Capital in the Twenty-First Century,” said he favored the Portland tax as a first step.

“This is certainly part of the solution,” Mr. Piketty wrote in an email, “but the tax surcharge needs to be large enough; the threshold ‘100 times’ should be substantially lowered.”

Taxing companies that dole out outsize executive pay in Portland was the idea of Steve Novick, a former environmental lawyer who has been a Portland city commissioner since January 2013.

“When I first read about the idea of applying a higher tax rate to companies with extreme ratios of C.E.O. pay to typical worker pay, I thought it was a fascinating idea,” Mr. Novick, a Democrat, said in a telephone interview. “It was the closest thing I’d seen to a tax on inequality itself.”

...

http://www.alternet.org/culture/fighting-back-doc-reveals-inequality

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http://www.rdwolff.com/

2013 inequality US argentina s africa

http://www.un.org/esa/socdev/documents/reports/InequalityMatters.pdf

https://en.wikipedia.org/wiki/List_of_countries_by_income_equality

https://www.thenation.com/article/20-people-now-own-as-much-wealth-as-half-of-all-americans/

20 People Now Own As Much Wealth as Half of All Americans

The US is caught in a vicious cycle, with rising political inequality driving an ever-rising concentration of wealth at the top.

By Joshua Holland DECEMBER 3, 2015

The 400 richest Americans now have more wealth than the bottom 61 percent of the population, a report released on Wednesday by the Institute for Policy Studies (IPS) reveals. According to “Billionaire Bonanza: The Forbes 400 and the Rest of Us,” just the twenty individuals at the top of the pile—a group that could fit into a Gulfstream G650 luxury jet, according to the study’s authors—now control more wealth than the bottom half of the population. That’s 152 million people living in 57 million households.

And there’s a stark racial divide at the top. The 100 richest households own more assets than the entire African-American community (there are just two black people on the Forbes 400 list, one of whom is Oprah Winfrey). And just 182 individuals on the Forbes list have more assets than America’s entire Hispanic population.

But Chuck Collins, director of IPS’s Program on Inequality and the Common Good and a co-author of the report, tells The Nation that their study likely underestimates the scope of the problem. “Our wealth data is a tip of the iceberg,” he says. “So much wealth among the über-rich is hidden, either in offshore tax havens or in these loophole trusts where money is shuffled around into private corporate accounts or between different family members, and it disappears from taxation or any sort of oversight or accountability. So there’s a huge amount of escaped wealth that isn’t even factored into these statistics.”

And Collins says it’s only getting worse. “These inequalities really undermine our quality of life,” he says. “We need to explain to people who say ‘So what, I don’t care how much the Forbes 400 has’ that it really does touch on all of our lives, deeply and profoundly.”

It’s only when you look past the numbers that the scope of the problem comes fully into focus. A 2009 study published in the British Medical Journal compared income inequality (which is less extreme than wealth inequality) in the United States and 14 other wealthy countries, and found that our skewed income levels corresponded with 893,914 avoidable deaths per year compared with those other economies. That’s more unnecessary deaths than are associated with tobacco use, car accidents, and gun deaths combined.

Stephen Bezruchka, a professor of public health at the University of Washington, told me in an interview last year that stress is a key driver of those outcomes. “What happens is those lower down the economic ladder experience more stress,” he said. “They secrete more stress hormones until they’re burned out. Stress is our 21st-century tobacco.”

A recent study by Princeton economists Angus Deaton and Anne Case found that the mortality rate among white, middle-aged Americans with limited education is increasing, while those of every other group—and the citizens of every other advanced country—continue to fall. The increase in deaths among this group is attributable to what The New York Times described as “an epidemic of suicides and afflictions stemming from substance abuse: alcoholic liver disease and overdoses of heroin and prescription opioids.” One theory, offered by Sam Pizzigati, is that this population suffers from “thwarted aspirations,” having been raised with expectations of upward mobility that never came to fruition.

Collins says that these levels of inequality also tear at our social fabric. No longer do Americans feel like we’re all in the same boat; we now “live in parallel universes.” As a result, he says, “people create mythologies about each other”—like the “makers versus takers” rhetoric that reared its ugly head during the 2012 presidential election.

The concentration of wealth at the top isn’t the result of some sort of organic process. The top one-10th of 1 percent of American households controlled about 7 percent of the nation’s wealth in the mid-1970s. By 2000, their share had grown to about 15 percent, and today it’s well over 20 percent. Those at the very top didn’t become three times as smart or lucky or good-looking in the intervening years. They’ve benefited from changes in things like trade policy, the tax code, and collective-bargaining rules—all policy changes they’ve used their wealth to champion.

The IPS report offers policy recommendations that might help turn the tide. It suggests cutting off a variety of “wealth escape routes” that people who hire armies of tax accountants enjoy; raising the floor with minimum wage hikes, better access to healthcare, debt-free higher education, and paid family leave; and leveling the political playing field with campaign finance reform. Others have proposed a variety of wealth-building programs like universal savings accounts that might be subsidized for low-income savers.

But that brings us to the obvious roadblock: Studies by Princeton’s Larry Bartels and Thomas Hayes at Trinity University have found that our elected officials are highly sensitive to the interests of the wealthiest Americans (and overwhelmingly belong to that group themselves), pay some attention to those of the middle class—and the views of the poor don’t factor into legislators’ voting tendencies at all.

And what do the interests of the rich and powerful look like? A 2013 study by Bartels, Benjamin Page, and Jason Seawright found that those in the top 1 percent are heavily involved in politics, and they tend to focus their advocacy on advancing their own narrow self-interests. On average, they’re less likely than the population as a whole to support robust social safety nets, public education, and expanded access to healthcare. Other studies have found that the affluent “showed reduced sensitivity to others’ suffering” when compared with working- and middle-class people. That’s who’s in charge.

With stranglehold the wealthy have on our politics, it’s hard to see where this cycle ends. And while we have the greatest degree of wealth inequality in the developed world, this isn’t an American problem. In Europe, the rise of far-right, ultranationalist parties has been linked to rising inequality—and declining economic security for the middle class. Thomas Piketty, author of Capital in the Twenty-First Century, argues that sky-high inequality in the Middle East is a major reason terrorist groups like ISIS find fertile ground for recruitment.

One reason for hope, according to Collins, is that the public’s awareness of just how problematic these hugely wealthy dynasties are becoming has increased. “People are realizing that a certain amount of inequality is part of how our society works, but these are absurdly extreme levels of inequality,” he says. And while we can talk all day about policy fixes, those things “won’t matter unless we actually build a movement to tax wealth and invest it in things that create opportunity for everyone else.”

ECONOMY

We Desperately Need a Vision for a New Economy That Serves All

Caring, innovative state legislator David Bly explains what is necessary for a better future and why.

s. Kim Phillips-Fein in Invisible Hands: The Businessmen’s Crusade Against the New Deal; Paul Pierson and Jacob S. Hacker in Winner-Take-All Politics; and Hedrick Smith in Who Stole the American Dream? tell much the same story in different ways. When the Supreme Court determined that money was speech in 1976, things began to change quickly.

By Bill Moyers, David Bly / BillMoyers.com August 24, 2016

In The New York Times recently, the paper’s former Washington bureau chief, the veteran journalist Hedrick Smith, asked an important question: “Can the States Save American Democracy?” Smith, who traveled the country to write his latest book, Who Stole the American Dream?, also serves as the executive editor of the Reclaim the American Dream website, where he keeps a keen eye on efforts to revitalize politics closest to where people live. In his op-ed essay he answered his own question by reporting that “a broad array of state-level citizen movements are pressing for reforms… to give average voters more voice, make elections more competitive and ease gridlock in Congress.”

There’s a lot of energy stirring in the states, including efforts to create a fairer economy. Unlike our paralyzed and polarized Congress, state legislators — those with eyes to see and ears to hear — know the walking-wounded casualties from the long campaign against working people conducted by Big Business and rabid free-marketeers over the past three decades. Among the stunned and shell-shocked are millions of survivors barely hanging on after the financial crash of 2008 and the Great Recession that followed. They live down the street and around the corner, a mere few blocks from the state capitol.

Here at BillMoyers.com, just as Hedrick Smith’s essay appeared last weekend, we were finishing a small book — 95 pages — by one of those state legislators: Minnesota’s David Bly. After teaching in the public schools for 30 years he retired and ran for the Minnesota House of Representatives, where he is now serving his fourth term. What he’s seen close-up prompted him to write We All Do Better: Economic Priorities for a Land of Opportunity.You can order a copy from the publisher’s website. It is short in length but not of passion. Here, with permission, is an excerpt:

Not so long ago, the words “Land of Opportunity” really meant something for all Americans. We pretty much took it for granted that each and every one of us should have the opportunity to develop our God-given talents to reach our greatest potential. This didn’t mean that everyone would choose to use that opportunity, or that anyone would be forced to use it. It did, however, mean that everyone had that opportunity…. As the late Sen. Paul Wellstone once said, “We all do better when we all do better.”

Things are changing, and not for the better. All too often, we hear stories of families evicted from their homes when unemployment runs out, or senior citizens who must choose between buying groceries and life-sustaining medications, or the single mother who can’t get a job because she must spend her time nursing her invalid son. We open the paper to read yet another story about the achievement gap in our schools. We watch the news and are shocked to learn that the United States is the world’s leader in putting its citizens behind bars.

These kinds of thing don’t happen, or at least shouldn’t, when there is a nationwide commitment for everyone to have what they need to develop their potential. This commitment goes beyond lip service and political speeches. It involves deliberate policies that maintain what I call a “middle-class economy.” A middle-class economy is not one in which every single person makes a certain amount of money. Even in a middle-class economy, some are rich and some are poor. But most of the people have most of the money. Most of the people can take care of themselves and fully develop their potential. Those that can’t take care of themselves for any number of understandable reasons can count on the rest of us to get them through the rough spots.

Right now we are in the process of losing our middle-class economy. We know this from news stories, and far too many of us know it from bitter personal experience. This loss of our middle-class economy and the resultant shift to a “winner-take-all” economy of rich and poor are behind most of the problems with which we struggle as a society.

The Spirit Level by Richard Wilkinson and Kate Pickett helped me see how and why this is so. The authors demonstrate in powerful terms how growing inequality is crippling both our society and our economy in ways that will make it harder to address critical problems we face as a nation. Page after page of graphs illustrate how we have fallen behind other developed nations in the things a well-functioning economy must provide. Wilkinson and Pickett make a solid case that it is not so much the average income of a society that matters. More important is how that income is distributed. Countries that have the most equal income distribution do best on health and social indicators.

According to Wilkinson and Pickett, who are epidemiologists, income inequality is related to “lower life expectancy, higher rates of infant mortality, shorter height, poor self-reported health, low birth weight, AIDS and depression.” They collected data from dozens of other rich countries on health, level of trust, mental illness, drug and alcohol addiction, life expectancy, infant mortality, teenage birth rates, obesity, children’s educational performance, homicides, imprisonment and social mobility. “What is most exciting about our research is that it shows that reducing inequality would increase the well-being and quality of life for all of us,” the authors say. Today we have a choice: use public investment to reduce inequality or pay for the social harm caused by inequality.

Wilkinson and Pickett also believe: “Modern societies will depend increasingly on being creative, adaptable, inventive, well-informed and flexible, able to respond generously to each other and to needs wherever they arise. Those are societies not in hock to the rich, in which people are driven by status insecurities, but of populations used to working together and respecting each other as equals.” Any search for economic salvation that is motivated and driven by the greed of its individual participants is bound to fail.

Ours is the oldest modern democracy, but present-day policies and court decisions are undermining our basic democratic principles. Immense power has been ceded to a cadre of financial elites who have figured out how to buy their way into control of our government. The past 30 years have seen two related trends: (1) an unraveling of benefits and opportunities for the vast majority of Americans, and (2) a massive increase in wealth for a relative handful of people. Leading economists assure us that if we don’t take decisive action, we can expect more of the same. Economist Emmanuel Saez has carefully analyzed the shift toward a rich-and-poor economy. He says, “The market itself doesn’t impose a limit on inequality, especially for those at the top.” His partner in research, Thomas Piketty, has further documented and explained income inequality in his book Capital in the 21st Century. As I write this, the very wealthy are enjoying a good recovery from the recession of 2008 while the vast majority of Americans fall further behind.

Our descent from an economy that provided for all of us to one that provides for only the few has been no accident. Nor was it inevitable. The story of how government has gone from limiting greed to encouraging it is chronicled in several recent books. Kim Phillips-Fein in Invisible Hands: The Businessmen’s Crusade Against the New Deal; Paul Pierson and Jacob S. Hacker in Winner-Take-All Politics; and Hedrick Smith in Who Stole the American Dream? tell much the same story in different ways. When the Supreme Court determined that money was speech in 1976, things began to change quickly. The super-rich suddenly gained an advantage in their campaign to silence the power of people and weaken our democracy. Today, with the Supreme Court decision on the Citizen’s United case, corporations are “people,” and even misinformation and lies spread by these strange new “people” are protected speech.

Economic value is created by law. We often use the words “free market” to describe our current economic system, but that system, as much as any other, rests on a set of legal rules and a system to enforce those rules. So it matters who writes the laws or what interests those laws serve. Similarly, the distribution of wealth and the flow of capital can flow one way or the other with the stroke of an official pen. Property rights and the distribution of wealth can deny liberty to some just as easily as they bestow it on others. Amartya Sen, a Nobel Award-winning economist, argues that hunger is not a product of the shortage of food. Instead, hungry people lack rights (the entitlement) to eat. The law decides, or as Sen puts it, “The law stands between food availability and food entitlement. Starvation deaths can reflect legality with a vengeance.”

Chief Justice Charles Evans Hughes, who served 1930-41, argued that the Constitution protects “liberty in a social organization which requires the protection of law against the evils which menace the health, safety, morals and welfare of the people.” Beginning with the founding of our nation, we have a rich tradition of concern for equality and protection from the abuses that wealth, poorly distributed, can bring about. As America waged war with Britain for independence over 200 years ago, the revolutionary patriot and journalist super-patriot Tom Paine advocated that public employment be utilized to assist those needing work, that a system of social security should provide for retirement at age 60, and that the state should provide funds so that poor families could educate and care for their children. In another example, the end of the Civil War saw the passage of amendments to the Constitution that banned slavery and limited the degree to which states could discriminate against their citizens. These amendments, in turn, broadened democracy and set us on a path that eventually resulted in the establishment of voting rights for blacks and women.

So, how do we build and maintain an enduring middle-class economy? In my judgment, every middle-class economy must be built on these five foundations:

Quality education for everyone

Health care for everyone

A world-class transportation system

Energy systems that maintain a clean and safe environment

Living wages for working people

Each of these is being challenged today by anti-democratic forces. Budget cuts are wreaking havoc at all levels of education. College is harder to afford, increasingly results in crippling debt and does not guarantee job prospects.

We hear that we have the best health care in the world, but the numbers tell us differently. Our health outcomes do not measure up to the rest of the developed world because our system, even with the advances made with the Affordable Care Act, does not assure universal access.

Prosperous economies require that goods and people can move around easily. Investment in transportation infrastructure is essential. We all feel the cost as roads, bridges and public transportation are neglected.

Environment, energy and land use go hand-in-hand in a middle-class economy. A clean, safe environment supports good health and quality of life for everyone. Instead of moving forward on clean energy and correcting harmful practices, we continue to rely on fossil fuels and to live with the economic and environmental consequences.

The fifth foundation of a middle-class economy is living-wage jobs. Generations before us took for granted that hard-working Americans would share in our prosperity. We have abandoned that understanding. Wages for most Americans have flatlined in spite of continuing pressure from rising costs of life’s essentials. In a 2014 survey by the Pew Foundation, over 10 times as many respondents said their incomes were falling behind the cost of living than said they were getting ahead.

The last 30 years have seen a corporate war against American workers. Corporation after corporation shipped middle-class jobs to Third-World countries. Now, politicians across the country invariably meet out-of-work industrial workers who ask them what they can do about the sell-off of jobs in America. All too often, the politician has no response and no idea what to do. Some extreme free-market ideologues even say that what is happening to so many works is actually a good thing, something that in the long run will make our economy better off. Of course, many of those making such claims have high-paying jobs, stable jobs representing the interests of the financial elite.

Here in Minnesota wages for new hires, adjusted for inflation, have been heading downward since 2006 and fell to $11.64 in 2011. The minimum wage went from one of the lowest in the country to $9.50. A family three (the average family size in Minnesota) would need an hourly wage of $16.34 to make it. How can anyone feel secure and support a family with that kind of discrepancy? People working full-time deserve the dignity of a living wage, but our policies are moving us in the opposite direction. The Minneapolis Star Tribune, for example, tells of a 59-year-old truck driver who lived well on the 41-cents-a-mile he made 16 years ago, but now he is making the exact same amount in the face of much higher living costs. He works six days a week instead of the five he used to and still can barely make ends meet.

These are by no means isolated cases in my home state or elsewhere. Economist Robert Reich wrote this about the battered middle class: “Having been roughed up, they face years of catch-up to get to where the once were. They feel poorer because they are poorer. They feel less secure because they are less secure. The crisis’s severity — and the fact that it surprised most ‘experts’ — shocked them. The large income and wealth losses compounded their sense of vulnerability.”

How do those of us in public office respond?

Former Sen. Byron Dorgan of North Dakota tells the story of the working man who was standing in line to pay his last respects to President Franklin D. Roosevelt. “Did you know the president?” a reporter asked him. “No,” the man said through tears, “but he knew me.”

That is our obligation today — to close the distance between the governed and the governing by rebuilding a middle-class economy. The five foundations of that economy have this in common: they are all “we” concepts. We all benefit when they are in place, and we all suffer when they crumble. When we work together toward our common good, we grow a middle-class economy. When we work against each other as individuals, we are on the road to becoming a Third World economy. As much as I hate to say it, this is exactly the path we are on.

Much of my book is concerned with my home state of Minnesota, where I serve in the state legislature. But I’m sure you will also see that much of what I say about my home state applies just as much to yours. We are all in this together. We all need to get our state and federal spending priorities focused in a way that will make a difference. That way is the way of rebuilding our middle-class economy and opportunity for all.

Excerpted with permission from Levins Publishing

http://www.alternet.org/economy/rebuilding-americas-middle-class-economy

http://www.alternet.org/economy/how-americas-superrich-are-draining-poor-longer-life-span How America's Superrich Are Draining the Poor of a Longer Life Span

http://www.alternet.org/economy/americas-rich-may-soon-blow-past-roaring-twenties-tycoons

http://ecowatch.com/2016/01/19/global-wealth-gap/

Mere 62 people own the same amount of wealth as the world’s poorest 3.6 billion people, according to an Oxfam report published on Monday. This number has fallen dramatically from 388 as recently as 2010 and 80 last year.

billionaires

The above chart shows what size transport the billionaires would fit on. Photo credit: Oxfam

The report, An Economy for the 1 Percent, found that the wealth of the poorest half of the world’s population has fallen by a trillion dollars since 2010.

“This 41 percent drop has occurred despite the global population increasing by around 400 million people during that period,” Oxfam said. “Meanwhile the wealth of the richest 62 has increased by more than half a trillion dollars to $1.76 trillion.”

Using data from Credit Suisse, Oxfam also found that the richest 1 percent now has as much wealth as the rest of the world combined.

“It is simply unacceptable that the poorest half of the world population owns no more than a small group of the global super-rich—so few, you could fit them all on a single coach,” Mark Goldring, Oxfam Great Britain chief executive, said.

The report comes ahead of the World Economic Forum, an annual gathering of financial and political elites in Davos, Switzerland, which will take place Jan. 20 to Jan. 23.

“World leaders’ concern about the escalating inequality crisis has so far not translated into concrete action to ensure that those at the bottom get their fair share of economic growth,” Goldring said. “In a world where one in nine people go to bed hungry every night we cannot afford to carry on giving the richest an ever bigger slice of the cake.

“It is no longer good enough for the richest to pretend that their wealth benefits the rest of us when the facts show that the recent explosion in the wealth of the super-rich has come at the expense of the poorest.

“Ending extreme poverty requires world leaders to tackle the growing gap between the richest and the rest which has trapped hundreds of millions of people in a life of poverty, hunger and sickness.”

62 billionaires own as much as the poorest half of the world's population, Oxfam reports https://t.co/Vastbkwkzn pic.twitter.com/H4iuGxN2y4

— Press Association (@PA) January 18, 2016

The wealth of the richest 62 was calculated using Forbes‘ billionaires list. The list of 62 includes Bill Gates, Warren Buffett, the Koch brothers and the Walmart heirs.

David and Charles Koch, principle owners of Koch Industries, are tied for sixth place on Forbes’ billionaire list with each having an estimated net worth of $42.9 billion. The Koch brothers stand out with the second largest private company by revenue in the U.S.

“Few outside business circles know … how pervasive their company’s industrial influence is on our everyday lives,” explained Popular Mechanics.

The Rolling Stone reported:

“The volume of Koch Industries’ toxic output is staggering. According to the University of Massachusetts Amherst’s Political Economy Research Institute, only three companies rank among the top 30 polluters of America’s air, water and climate: ExxonMobil, American Electric Power and Koch Industries.

Thanks in part to its 2005 purchase of paper-mill giant Georgia-Pacific, Koch Industries dumps more pollutants into the nation’s waterways than General Electric and International Paper combined. The company ranks 13th in the nation for toxic air pollution. Koch’s climate pollution, meanwhile, outpaces oil giants including Valero, Chevron and Shell. Across its businesses, Koch generates 24 million metric tons of greenhouse gases a year.”

And they’ve used their vast wealth to back candidates and legislation that weaken environmental regulations that safeguard human health. Their network of conservative mega-donors, or the Freedom Partners Chamber of Commerce, raised $400 million in the 2012 election, and they plan to spend $889 million for the 2016 presidential race, according to the The Washington Post.

poster child:

In late 2011, the impoverished little municipality was so deep in debt to its public electric company, DTE Energy, that the local government was forced to decommission all streetlights on its residential streets. Not only did DTE cut the power to street lights in Highland Park, it sent out workers to physically dig up and remove nearly 1,000 light-poles from the neighborhood. Highland Parkers now live in permanent, debt-induced darkness.

Six miles away, in Detroit’s rapidly gentrifying downtown area, DTE Energy runs a very different public policy. The same company that repossessed 1,000 streetlights from Highland Park, condemning its residents to permanent darkness, has recently launched a pro-bono security program in the increasingly white area.

On its own dime, DTE operates a public “bait car” program. It buys and sets booby-trap cars out on the downtown streets, outfitted with up to 18 hidden cameras, to lure and ultimately deter potential car theft. A partnership with downtown police assures that cops will be on the scene within 90 seconds of when the bait car is entered.

“We want to be part of something good about changing perceptions of the city of Detroit,” DTE’s chief security officer boasts of the bait-car program, “We want to be part of the revitalization of the city.”

Safety is a privilege in Detroit. Like all privileges, it gravitates toward the white and wealthy.

Decades of budget cuts to public safety services alongside concentrated investment downtown has created two Detroits: downtown, white and professional, bathed in state-of-the-art private security; and the “neighborhoods,” poor and black, where public safety has become a do-it-yourself endeavor.

Turning out the Lights

In Detroit’s black neighborhoods, public safety has been sacrificed to the gods of austerity. With the city government too poor provide basic security, safety has become a private commodity, accessible to the wealthy, but far out of reach for the majority of Detroiters.

The slow but massive exodus of capital and residents over the last half-century has left the Motor City broken down and overgrown in municipal debt. By the time Detroit faced its financial day of reckoning in bankruptcy court, years of budget cuts had already dismantled its most basic public services—police, fire, even streetlights—to barely functional levels.

The steady, long-term disinvestment in public safety shows through in crime rates.

In a given week, Detroit averages seven murders, 226 burglaries, 92 robberies, 169 aggravated assaults, 228 cars stolen, 331 larceny thefts, 12 rapes, and 279 violent crimes — the vast majority occurring in the neighborhoods and leading to no arrests. These dark accolades have earned Detroit the most dangerous city in America honor five out of the last seven years.

Absurdly underfunded emergency services are unable to keep up with the city’s record crime. In 2013, the same year Detroit led the country with 333 homicides, its police department took a $75 million— or 18% — overall haircut. Emergency Medical Services has taken similar hits. In 2005, Detroit had 303 paramedics working the streets. By 2010, the working paramedic count was cut to 188 to match a shrinking budget. The result: laughably bad 911 response times.

http://www.alternet.org/economy/paul-krugman-how-bad-america-could-get-if-1-loving-republican-won-2016

Krugman now has some official numbers on his side to make the case that having Obama in the White House instead of Mitt Romney has made a serious difference to the country. In Monday's column, Krugman looks at the I.R.S.’s tax tables for 2013, which were released last week, and concludes that elections have real consequences. His argument is directed to people on the left, who are disappointed with what Obama has been able to accomplish and argue that there is no major difference between the two parties—except Bernie Sanders—and that the wealthy will always dominate.

Well, yes, but there has been some measurable progress, Krugman argues.

For one of the important consequences of the 2012 election was that Mr. Obama was able to go through with a significant rise in taxes on high incomes. Partly this was achieved by allowing the upper end of the Bush tax cuts to expire; there were also new taxes on high incomes passed along with the Affordable Care Act, a.k.a. Obamacare.

If Mitt Romney had won, we can be sure that Republicans would have found a way to prevent these tax hikes. And we can now see what happened because he didn’t. According to the new tables, the average income tax rate for 99 percent of Americans barely changed from 2012 to 2013, but the tax rate for the top 1 percent rose by more than four percentage points. The tax rise was even bigger for very high incomes: 6.5 percentage points for the top 0.01 percent.

These numbers aren’t enough to give us a full picture of taxes at the top, which requires taking account of other taxes, especially taxes on corporate profits that indirectly affect the income of stockholders. But the available numbers are consistent with Congressional Budget Office projections of the effects of the 2013 tax increases — projections which said that the effective federal tax rate on the 1 percent would rise roughly back to its pre-Reagan level. No, really: for top incomes, Mr. Obama has effectively rolled back not just the Bush tax cuts but Ronald Reagan’s as well.

The point, of course, was not to punish the rich but to raise money for progressive priorities, and while the 2013 tax hike wasn’t gigantic, it was significant. Those higher rates on the 1 percent correspond to about $70 billion a year in revenue. This happens to be in the same ballpark as bothfood stamps and budget office estimates of this year’s net outlays on Obamacare. So we’re not talking about something trivial.

And, of course, Obamacare would have been killed if Romney had won, meaning the 17 million Americans insured since 2012 and rising would remain uninsured.

http://www.alternet.org/economy/sipping-champagne-titanic-twenty-billionaires-own-more-bottom-half-americans

new Institute for Policy Studies report "Billionaire Bonanza: The Forbes 400 and the Rest of Us" is out.

http://www.ips-dc.org/billionaire-bonanza/

KEY FINDINGS:

America’s 20 wealthiest people — a group that could fit comfortably in one single Gulfstream G650 luxury jet – now own more wealth than the bottom half of the American population combined, a total of 152 million people in 57 million households.

The Forbes 400 now own about as much wealth as the nation’s entire African-American population – plus more than a third of the Latino population – combined.

The wealthiest 100 households now own about as much wealth as the entire African American population in the United States. Among the Forbes 400, just 2 individuals are African American – Oprah Winfrey and Robert Smith.

The wealthiest 186 members of the Forbes 400 own as much wealth as the entire Latino population. Just five members of the Forbes 400 are Latino including Jorge Perez, Arturo Moreno, and three members of the Santo Domingo family.

With a combined worth of $2.34 trillion, the Forbes 400 own more wealth than the bottom 61 percent of the country combined, a staggering 194 million people.

The median American family has a net worth of $81,000. The Forbes 400 own more wealth than 36 million of these typical American families. That’s as many households in the United States that own cats.

We believe that these statistics actually underestimate our current national levels of wealth concentration. The growing use of offshore tax havens and legal trusts has made the concealing of assets much more widespread than ever before.

Two types of policy interventions can reduce extreme wealth inequality in the United States. ?

First, we must close wealth escape routes. ?Wealthy individuals are moving quickly to shift wealth into offshore tax havens and bury it in private trusts, avoiding accountability and taxation every step of the way. This hidden wealth now totals in the trillions. Our first step must be to close these escape routes and tax dodges.

Second, we need to implement policies to reduce concentrated wealth. ?Without action to directly reduce private concentrations of wealth, inequality will continue to grow. By seriously taxing our wealthiest households, we could raise significant revenues and invest these funds to expand wealth-building opportunities across the economy.

For the Wealthiest, a Private Tax System That Saves Them Billions

By NOAM SCHEIBER and PATRICIA COHEN

The very richest are able to quietly shape tax policy that will allow them to shield billions in income.

WASHINGTON — The hedge fund magnates Daniel S. Loeb, Louis Moore Bacon and Steven A. Cohen have much in common. They have managed billions of dollars in capital, earning vast fortunes. They have invested large sums in art — and millions more in political candidates.

Moreover, each has exploited an esoteric tax loophole that saved them millions in taxes. The trick? Route the money to Bermuda and back.

With inequality at its highest levels in nearly a century and public debate rising over whether the government should respond to it through higher taxes on the wealthy, the very richest Americans have financed a sophisticated and astonishingly effective apparatus for shielding their fortunes. Some call it the “income defense industry,” consisting of a high-priced phalanx of lawyers, estate planners, lobbyists and anti-tax activists who exploit and defend a dizzying array of tax maneuvers, virtually none of them available to taxpayers of more modest means.

RELATED COVERAGE

I.R.S. Cracks Down on Hedge Fund Tax StrategyJULY 8, 2015

Peter Brown, co-chief executive of Renaissance Technologies, testified in front of a Senate subcommittee on Tuesday in Washington.DealBook: Hedge Fund Chief Testifies at Senate Tax-Avoidance HearingJULY 22, 2014

In recent years, this apparatus has become one of the most powerful avenues of influence for wealthy Americans of all political stripes, including Mr. Loeb and Mr. Cohen, who give heavily to Republicans, and the liberal billionaire George Soros, who has called for higher levies on the rich while at the same time using tax loopholes to bolster his own fortune.

All are among a small group providing much of the early cash for the 2016 presidential campaign.

Operating largely out of public view — in tax court, through arcane legislative provisions and in private negotiations with the Internal Revenue Service — the wealthy have used their influence to steadily whittle away at the government’s ability to tax them. The effect has been to create a kind of private tax system, catering to only several thousand Americans.

The impact on their own fortunes has been stark. Two decades ago, when Bill Clinton was elected president, the 400 highest-earning taxpayers in America paid nearly 27 percent of their income in federal taxes, according to I.R.S. data. By 2012, when President Obama was re-elected, that figure had fallen to less than 17 percent, which is just slightly more than the typical family making $100,000 annually, when payroll taxes are included for both groups.

The ultra-wealthy “literally pay millions of dollars for these services,” said Jeffrey A. Winters, a political scientist at Northwestern University who studies economic elites, “and save in the tens or hundreds of millions in taxes.”

Some of the biggest current tax battles are being waged by some of the most generous supporters of 2016 candidates. They include the families of the hedge fund investors Robert Mercer, who gives to Republicans, and James Simons, who gives to Democrats; as well as the options trader Jeffrey Yass, a libertarian-leaning donor to Republicans.

Mr. Yass’s firm is litigating what the agency deemed to be tens of millions of dollars in underpaid taxes. Renaissance Technologies, the hedge fund Mr. Simons founded and which Mr. Mercer helps run, is currently under review by the I.R.S. over a loophole that saved their fund an estimated $6.8 billion in taxes over roughly a decade, according to a Senate investigation. Some of these same families have also contributed hundreds of thousands of dollars to conservative groups that have attacked virtually any effort to raises taxes on the wealthy.

For the Richest, Lower Taxes

The average tax rate for the ultra-wealthy has fallen dramatically.

Income Tax Rate

1995

2000

2005

2012

Top 400 earners

Note: 2012 is the last year for which final data is available.

In the heat of the presidential race, the influence of wealthy donors is being tested. At stake is the Obama administration’s 2013 tax increase on high earners — the first substantial increase in two decades — and an I.R.S. initiative to ensure that, in effect, the higher rates stick by cracking down on tax avoidance by the wealthy.

While Democrats like Bernie Sanders and Hillary Clinton have pledged to raise taxes on these voters, virtually every Republican has advanced policies that would vastly reduce their tax bills, sometimes to as little as 10 percent of their income.

At the same time, most Republican candidates favor eliminating the inheritance tax, a move that would allow the new rich, and the old, to bequeath their fortunes intact, solidifying the wealth gap far into the future. And several have proposed a substantial reduction — or even elimination — in the already deeply discounted tax rates on investment gains, a foundation of the most lucrative tax strategies.

“There’s this notion that the wealthy use their money to buy politicians; more accurately, it’s that they can buy policy, and specifically, tax policy,” said Jared Bernstein, a senior fellow at the left-leaning Center on Budget and Policy Priorities who served as chief economic adviser to Vice President Joseph R. Biden Jr. “That’s why these egregious loopholes exist, and why it’s so hard to close them.”

The Family Office

Each of the top 400 earners took home, on average, about $336 million in 2012, the latest year for which data is available. If the bulk of that money had been paid out as salary or wages, as it is for the typical American, the tax obligations of those wealthy taxpayers could have more than doubled.

Instead, much of their income came from convoluted partnerships and high-end investment funds. Other earnings accrued in opaque family trusts and foreign shell corporations, beyond the reach of the tax authorities.

The well-paid technicians who devise these arrangements toil away at white-shoe law firms and elite investment banks, as well as a variety of obscure boutiques. But at the fulcrum of the strategizing over how to minimize taxes are so-called family offices, the customized wealth management departments of Americans with hundreds of millions or billions of dollars in assets.

Family offices have existed since the late 19th century, when the Rockefellers pioneered the institution, and gained popularity in the 1980s. But they have proliferated rapidly over the last decade, as the ranks of the super-rich, and the size of their fortunes, swelled to record proportions.

“We have so much wealth being created, significant wealth, that it creates a need for the family office structure now,” said Sree Arimilli, an industry recruiting consultant.

Family offices, many of which are dedicated to managing and protecting the wealth of a single family, oversee everything from investment strategy to philanthropy. But tax planning is a core function. While the specific techniques these advisers employ to minimize taxes can be mind-numbingly complex, they generally follow a few simple principles, like converting one type of income into another type that’s taxed at a lower rate.

Mr. Loeb, for example, has invested in a Bermuda-based reinsurer — an insurer to insurance companies — that turns around and invests the money in his hedge fund. That maneuver transforms his profits from short-term bets in the market, which the government taxes at roughly 40 percent, into long-term profits, known as capital gains, which are taxed at roughly half that rate. It has had the added advantage of letting Mr. Loeb defer taxes on this income indefinitely, allowing his wealth to compound and grow more quickly.

The Bermuda insurer Mr. Loeb helped set up went public in 2013 and is active in the insurance business, not merely a tax dodge. Mr. Cohen and Mr. Bacon abandoned similar insurance-based strategies in recent years. “Our investment in Max Re was not a tax-driven scheme, but rather a sound investment response to investor interest in a more dynamically managed portfolio akin to Warren Buffett’s Berkshire Hathaway,” said Mr. Bacon, who leads Moore Capital Management. “Hedge funds were a minority of the investment portfolio, and Moore Capital’s products a much smaller subset of this alternative portfolio.” Mr. Loeb and Mr. Cohen declined to comment.

Louis Moore Bacon, shown with his wife, Gabrielle, is the founder of a highly successful hedge fund and a leading contributor to Jeb Bush’s super PAC. Among his homes is one on Robins Island, off Long Island. Credit Left: Amanda Gordon/Bloomberg News, via Getty Images

Organizing one’s business as a partnership can be lucrative in its own right. Some of the partnerships from which the wealthy derive their income are allowed to sell shares to the public, making it easy to cash out a chunk of the business while retaining control. But unlike publicly traded corporations, they pay no corporate income tax; the partners pay taxes as individuals. And the income taxes are often reduced by large deductions, such as for depreciation.

For large private partnerships, meanwhile, the I.R.S. often struggles “to determine whether a tax shelter exists, an abusive tax transaction is being used,” according to a recent report by the Government Accountability Office. The agency is not allowed to collect underpaid taxes directly from these partnerships, even those with several hundred partners. Instead, it must collect from each individual partner, requiring the agency to commit significant time and manpower.

The wealthy can also avail themselves of a range of esoteric and customized tax deductions that go far beyond writing off a home office or dinner with a client. One aggressive strategy is to place income in a type of charitable trust, generating a deduction that offsets the income tax. The trust then purchases what’s known as a private placement life insurance policy, which invests the money on a tax-free basis, frequently in a number of hedge funds. The person’s heirs can inherit, also tax-free, whatever money is left after the trust pays out a percentage each year to charity, often a considerable sum.

Many of these maneuvers are well established, and wealthy taxpayers say they are well within their rights to exploit them. Others exist in a legal gray area, its boundaries defined by the willingness of taxpayers to defend their strategies against the I.R.S. Almost all are outside the price range of the average taxpayer.

Among tax lawyers and accountants, “the best and brightest get a high from figuring out how to do tricky little deals,” said Karen L. Hawkins, who until recently headed the I.R.S. office that oversees tax practitioners. “Frankly, it is almost beyond the intellectual and resource capacity of the Internal Revenue Service to catch.”

The combination of cost and complexity has had a profound effect, tax experts said. Whatever tax rates Congress sets, the actual rates paid by the ultra-wealthy tend to fall over time as they exploit their numerous advantages.

From Mr. Obama’s inauguration through the end of 2012, federal income tax rates on individuals did not change (excluding payroll taxes). But the highest-earning one-thousandth of Americans went from paying an average of 20.9 percent to 17.6 percent. By contrast, the top 1 percent, excluding the very wealthy, went from paying just under 24 percent on average to just over that level.

“We do have two different tax systems, one for normal wage-earners and another for those who can afford sophisticated tax advice,” said Victor Fleischer, a law professor at the University of San Diego who studies the intersection of tax policy and inequality. “At the very top of the income distribution, the effective rate of tax goes down, contrary to the principles of a progressive income tax system.”

A Very Quiet Defense

Having helped foster an alternative tax system, wealthy Americans have been aggressive in defending it.

Trade groups representing the Bermuda-based insurance company Mr. Loeb helped set up, for example, have spent the last several months pleading with the I.R.S. that its proposed rules tightening the hedge fund insurance loophole are too onerous.

The major industry group representing private equity funds spends hundreds of thousands of dollars each year lobbying on such issues as “carried interest,” the granddaddy of Wall Street tax loopholes, which makes it possible for fund managers to pay the capital gains rate rather than the higher standard tax rate on a substantial share of their income for running the fund.

The budget deal that Congress approved in October allows the I.R.S. to collect underpaid taxes from large partnerships at the firm level for the first time — which is far easier for the agency — thanks to a provision that lawmakers slipped into the deal at the last minute, before many lobbyists could mobilize. But the new rules are relatively weak — firms can still choose to have partners pay the taxes — and don’t take effect until 2018, giving the wealthy plenty of time to weaken them further.

Shortly after the provision passed, the Managed Funds Association, an industry group that represents prominent hedge funds like D. E. Shaw, Renaissance Technologies, Tiger Management and Third Point, began meeting with members of Congress to discuss a wish list of adjustments. The founders of these funds have all donated at least $500,000 to 2016 presidential candidates. During the Obama presidency, the association itself has risen to become one of the most powerful trade groups in Washington, spending over $4 million a year on lobbying.

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Buying Power

Articles in this series examine America’s growing concentration of wealth and its consequences for government and politics.

THE ELITE DONORS

The Families Funding the 2016 Presidential ElectionOCT. 10, 2015

THE AGENDA

A Wealthy Governor and His Friends Are Remaking IllinoisNOV. 29, 2015

THE BIG BET

Inside the Billion-Dollar Battle for Puerto Rico’s FutureDEC. 19, 2015

And while the lobbying clout of the wealthy is most often deployed through industry trade associations and lawyers, some rich families have locked arms to advance their interests more directly.

The inheritance tax has been a primary target. In the early 1990s, a California family office executive named Patricia Soldano began lobbying on behalf of wealthy families to repeal the tax, which would not only save them money, but also make it easier to preserve their business empires from one generation to the next. The idea struck many hardened operatives as unrealistic at the time, given that the tax affected only the wealthiest Americans. But Ms. Soldano’s efforts — funded in part by the Mars and Koch families — laid the groundwork for a one-year elimination in 2010.

The tax has been restored, but currently applies only to couples leaving roughly $11 million or more to their heirs, up from those leaving more than $1.2 million when Ms. Soldano started her campaign. It affected fewer than 5,200 families last year.

“If anyone would have told me we’d be where we are today, I would never have guessed it,” Ms. Soldano said in an interview.

Some of the most profound victories are barely known outside the insular world of the wealthy and their financial managers.

In 2009, Congress set out to require that investment partnerships like hedge funds register with the Securities and Exchange Commission, partly so that regulators would have a better grasp on the risks they posed to the financial system.

The early legislative language would have required single-family offices to register as well, exposing the highly secretive institutions to scrutiny that their clients were eager to avoid. Some of the I.R.S.’s cases against the wealthy originate with tips from the S.E.C., which is often better positioned to spot tax evasion.

By the summer of 2009, several family office executives had formed a lobbying group called the Private Investor Coalition to push back against the proposal. The coalition won an exemption in the 2010 Dodd-Frank financial reform bill, then spent much of the next year persuading the S.E.C. to largely adopt its preferred definition of “family office.”

So expansive was the resulting loophole that Mr. Soros’s $24.5 billion hedge fund took advantage of it, converting to a family office after returning capital to its remaining outside investors. The hedge fund manager Stanley Druckenmiller, a former business partner of Mr. Soros, took the same step.

The Soros family, which generally supports Democrats, has committed at least $1 million to the 2016 presidential campaign; Mr. Druckenmiller, who favors Republicans, has put slightly more than $300,000 behind three different G.O.P. presidential candidates.

A slide presentation from the Private Investor Coalition’s 2013 annual meeting credited the success to multiple meetings with members of the Senate Banking Committee, the House Financial Services Committee, congressional staff and S.E.C. staff. “All with a low profile,” the document noted. “We got most of what we wanted AND a few extras we didn’t request.”

A Hobbled Monitor

After all the loopholes and all the lobbying, what remains of the government’s ability to collect taxes from the wealthy runs up against one final hurdle: the crisis facing the I.R.S.

President Obama has made fighting tax evasion by the rich a priority. In 2010, he signed legislation making it easier to identify Americans who squirreled away assets in Swiss bank accounts and Cayman Islands shelters.

His I.R.S. convened a Global High Wealth Industry Group, known colloquially as “the wealth squad,” to scrutinize the returns of Americans with incomes of at least $10 million a year.

But while these measures have helped the government retrieve billions, the agency’s efforts have flagged in the face of scandal, political pressure and budget cuts. Between 2010, the year before Republicans took control of the House of Representatives, and 2014, the I.R.S. budget dropped by almost $2 billion in real terms, or nearly 15 percent. That has forced it to shed about 5,000 high-level enforcement positions out of about 23,000, according to the agency.

Audit rates for the $10 million-plus club spiked in the first few years of the Global High Wealth program, but have plummeted since then.

Steven A. Cohen, shown with his wife, Alexandra, is the founder of SAC Capital and owns a home in East Hampton. He is a prominent art collector and has focused his political contributions on a super PAC for Gov. Chris Christie. Credit Left: Carly Erickson/BFA; Right: Doug Kuntz for The New York Times

The political challenge for the agency became especially acute in 2013, after the agency acknowledged singling out conservative nonprofits in a review of political activity by tax-exempt groups. (Senior officials left the agency as a result of the controversy.)

Several former I.R.S. officials, including Marcus Owens, who once headed the agency’s Exempt Organizations division, said the controversy badly damaged the agency’s willingness to investigate other taxpayers, even outside the exempt division.

“I.R.S. enforcement is either absent or diminished” in certain areas, he said. Mr. Owens added that his former department — which provides some oversight of money used by charities and nonprofits — has been decimated.

Groups like FreedomWorks and Americans for Tax Reform, which are financed partly by the foundations of wealthy families and large businesses, have called for impeaching the I.R.S. commissioner. They are bolstered by deep-pocketed advocacy groups like the Club for Growth, which has aided primary challenges against Republicans who have voted in favor of higher taxes.

In 2014, the Club for Growth Action fund raised more than $9 million and spent much of it helping candidates critical of the I.R.S. Roughly 60 percent of the money raised by the fund came from just 12 donors, including Mr. Mercer, who has given the group $2 million in the last five years. Mr. Mercer and his immediate family have also donated more than $11 million to several super PACs supporting Senator Ted Cruz of Texas, an outspoken I.R.S. critic and a presidential candidate.

Another prominent donor is Mr. Yass, who helps run a trading firm called the Susquehanna International Group. He donated $100,000 to the Club for Growth Action fund in September. Mr. Yass serves on the board of the libertarian Cato Institute and, like Mr. Mercer, appears to subscribe to limited-government views that partly motivate his political spending.

But he may also have more than a passing interest in creating a political environment that undermines the I.R.S. Susquehanna is currently challenging a proposed I.R.S. determination that an affiliate of the firm effectively repatriated more than $375 million in income from subsidiaries located in Ireland and the Cayman Islands in 2007, creating a large tax liability. (The affiliate brought the money back to the United States in later years and paid dividend taxes on it; the I.R.S. asserts that it should have paid the ordinary income tax rate, at a cost of tens of millions of dollars more.)

In June, Mr. Yass donated more than $2 million to three super PACs aligned with Senator Rand Paul of Kentucky, who has called for taxing all income at a flat rate of 14.5 percent. That change in itself would save wealthy supporters like Mr. Yass millions of dollars.

Mr. Paul, also a presidential candididate, has suggested going even further, calling the I.R.S. a “rogue agency” and circulating a petition in 2013 calling for the tax equivalent of regime change. “Be it now therefore resolved,” the petition reads, “that we, the undersigned, demand the immediate abolishment of the Internal Revenue Service.”

But even if that campaign is a long shot, the richest taxpayers will continue to enjoy advantages over everyone else.

For the ultra-wealthy, “our tax code is like a leaky barrel,” said J. Todd Metcalf, the Democrats’ chief tax counsel on the Senate Finance Committee. ”Unless you plug every hole or get a new barrel, it’s going to leak out.”

Nicholas Confessore contributed reporting and Kitty Bennett contributed research.

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http://www.democracynow.org/2015/12/30/headlines/new_york_times_rich_have_built_their_own_private_tax_system

A new investigation by The New York Times shows how the richest U.S.families have avoided paying billions of dollars in taxes by quietly building a "private tax system." The rich have reportedly exploited esoteric loopholes in the current tax system while pouring millions into lobbying for policies to pay even lower taxes, such as repealing the inheritance tax. The result has been billions of dollars in lost taxes. Twenty years ago, the 400 richest families paid 27 percent of their income to federal taxes. In 2012, the 400 richest families paid only 17 percent. Many of these same families who have exploited tax loopholes have poured large sums of money into the 2016 presidential campaign.

The Inequality Index: What Can Be Done to Close America's Growing Wealth Gap?

The Forbes 400 own as much wealth as the entire African-American population and more than a third of the Hispanic population in the United States — combined.

By Sue Sturgis / Facing South December 23, 2015

Two new reports document the growing chasm between the rich and the poor in the United States: "Billionaire Bonanza: The Forbes 400 and the Rest of Us" by Chuck Collins and Josh Hoxie of the Institute for Policy Studies, and "The American Middle Class Is Losing Ground" by Pew Research Center. Most of the numbers in the index below come from those reports.

Year in which the middle class ceased to be the economic majority in the U.S., exceeded by lower- and upper-income households combined: 2015

Percent of U.S. aggregate income that went to middle-income and upper-income households respectively in 1970: 62, 29

In 2014: 43, 49

Number of the richest people in the U.S. whose combined wealth, defined as total assets minus liabilities, exceeds that of the bottom half of the entire U.S. population: 20

Number of the richest U.S. households whose wealth exceeds that of the country's entire 42 million African Americans: 100

Number of the richest U.S. households whose wealth exceeds that of the country's more than 55 million Latinos: 186

The total wealth of those on the Forbes 400 list of richest people in the U.S.: $2.34 trillion

Number of those on the Forbes 400 list who are Latino: 5

Who are African-American: 2

Number of households in America's richest 0.1 percent, whose net worth starts at $20 million:115,000

Percent of total U.S. household wealth this economic elite owned in the 1970s: 7

Percent it owns today: 20

Of the 10 states with the biggest gaps between rich and poor, number that are in the South: 6

According to research by an economist with the International Monetary Fund, factor by which future U.S. economic expansions will be shorter compared to those of the 1960s because of the widening income divide: 1/3

Estimated amount the U.S. loses annually in tax revenue from wealthy individuals due to their use of tax havens and other avoidance schemes: $200 billion

Amount in tax revenue the U.S. could generate annually by levying a 1 percent tax on the wealth of the richest 1 percent of Americans, which would also help to reduce inequality: $260 billion

Amount of revenue the U.S. could raise over 10 years by taxing capital gains from the sale of stocks and other financial assets the same as income earned through work: $600 billion

Amount of revenue the U.S. could generate annually by taxing the richest 0.1 percent at a rate of 40 percent instead of the current 33 percent: $55 billion

Sue Sturgis is the editorial director of Facing South,

http://www.alternet.org/economy/its-official-middle-class-now-less-half-country

A new study from Pew Research Center makes it official: after four decades as the largest portion of the American populace, the country’s middle class has dipped to less than half, or 49.9 percent, of the population. Researchers, noting that the numbers have been slowly dwindling over decades, suggest this latest finding likely indicates a tipping point in the disappearance of the middle class.

Households of three with incomes between $42,000 and $126,000 were identified as middle-income earners under the terms of the study. As of 2015, that definition fit 120.8 million adult Americans, while a total of 121.3 million adults qualified as low or upper income. The proportion of middle-class Americans has tumbled to where it now stands from 61 percent in 1971. And even that figure seems slightly shaky considering middle class means different things to different people. Even casting aside uber-expensive cities like New York and San Francisco, supporting a family of three on $42,000 a year would present challenges even in the most affordable parts of the country.

If there is good news to be found—and Pew somehow located it, presumably with a magnifying glass and a pair of tweezers—it is that some of the middle class dropoff has transferred to upper-income households. Researchers observed that while just 14 percent of American adults were upper-income in 1971, that bloc now represents 21 percent of the population. That outpaced the number of Americans who slipped downward, which grew by only four points, from 25 percent in 1971 to 29 percent in 2015. But this strikes me as almost irrationally optimistic thinking: In a country where the wealth gap between the middle class and the upper class is the widest it has been since the numbers were tracked (another finding from Pew), there’s not exactly cause to celebrate the promise of economic mobility.

What’s more, as Pew researchers point out, while middle-class households saw their incomes grow from $54,682 to $73,392 between 1970 to 2014 (in 2014 dollars), they still didn’t make the monetary leaps of wealthier Americans. The 34 percent income gain of the middle class lagged behind the 47 percent income increase upper-income households experienced. Meanwhile, low-income households, predictably, fared worst of all: Their income increased only 28 percent.

These findings further darken the already dim economic prospects of most Americans. Pew notes that the numbers also reflect the hit many American households took as a result of back-to-back recessions in 2001 and 2007.

Earlier this year, a Gallup survey found that over the last eight years, Americans have become far less likely to self-identify as middle class. Between 2001 and 2008, roughly 60 percent of Americans described themselves as middle or upper class. That number has fallen to 51 percent, proving many Americans are perhaps more in tune with their financial reality than is often suggested.

The Los Angeles Times spoke with Patrick Egan, who teaches politics at New York University. He sees the potential for a shift in public sentiment, and ultimately, public policy, around “redistribution.”

“Americans are always kind of reluctant to embrace open class warfare,” Egan told the Times. "But if more Americans are under the idea of placing themselves at the bottom, you'll see politicians follow.”

House and Senate have their own form of inequality within their ranks. Of the 534 current members, the 53 richest owned nearly 80 percent of the estimated wealth held by all federal lawmakers in 2014, a Center for Responsive Politics analysis shows. That concentration resembles the inequality that exists in the United States more broadly, where 76 percent of the country’s wealth is held by the top 10 percent of households.

Granted, no tears should be shed for those elected few. The median wealth for a member of Congress, about $1.1 million in 2014, still far outpaces that of the typical American family, worth about $56,355 in 2013 (a 2014 figure is not available). And no member of Congress can be said to live in poverty: Congressional salaries alone remain at $174,000 at the least, placing members firmly in the top 10 percent of American wage earners, with an enviable pension for those who stay in office for at least five years.

Click here to read the full article.

http://www.alternet.org/economy/robert-reich-big-struggle-financial-elite-vs-everyone-else

... the trend is not sustainable economically. The American economy cannot maintain positive momentum without the purchasing power of its vast middle class. This is one reason why today, six full years into an economic recovery, theUS economy is barely back to where it was before it fell into the Great Recession.

Nor is it sustainable politically. A large portion of the American electorate, working harder than ever but seeing no wage gains for years, is becoming angry and frustrated. That anger and frustration, in turn, is fuelling a populist revolt against the prevailing establishment. The revolt is already manifest in the presidential election of 2016 in the forms of Democratic candidate Bernie Sandersand Republican candidate Donald Trump.

But the two are quite different. Sanders represents a tradition of leftwing reform populism that seeks to limit the influence of big money on the political process, thereby clearing the way for the enactment of new laws and rules that can deliver more broadly shared prosperity. Trump comes out of a tradition of rightwing authoritarian populism that seeks a strongman who will take power away from the prevailing oligarchy and deliver it back to the people directly. Often accompanying authoritarian populism is making a scapegoat of vulnerable minorities, including immigrants.

Both Britain and America have had brushes with authoritarian populism in the past. In the Depression decade of the 1930s, Oswald Mosley in Britain and Father Charles Coughlin in the United States offered authoritarian solutions to the nations’ economic problems. But neither nation has succumbed. In times of economic stress, both Britain and the United States have opted instead for reform. President Franklin D Roosevelt arguably saved American capitalism from its own excesses, as did William Beveridge and the postwar Labour government, with regard to British capitalism....

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http://www.nytimes.com/2015/11/09/opinion/despair-american-style.html?_r=0

...

been a lot of comment, and rightly so, over a new paper by the economists Angus Deaton (who just won a Nobel) and Anne Case, showing that mortality among middle-aged white Americans has been rising since 1999. This deterioration took place while death rates were falling steadily both in other countries and among other groups in our own nation.

Paul Krugman

Even more striking are the proximate causes of rising mortality. Basically, white Americans are, in increasing numbers, killing themselves, directly or indirectly. Suicide is way up, and so are deaths from drug poisoning and the chronic liver disease that excessive drinking can cause. We’ve seen this kind of thing in other times and places – for example, in the plunging life expectancy that afflicted Russia after the fall of Communism. But it’s a shock to see it, even in an attenuated form, in America.

Yet the Deaton-Case findings fit into a well-established pattern. There have been a number of studies showing that life expectancy for less-educated whites is falling across much of the nation. Rising suicides and overuse of opioids are known problems. And while popular culture may focus more on meth than on prescription painkillers or good old alcohol, it’s not really news that there’s a drug problem in the heartland.

But what’s causing this epidemic of self-destructive behavior?

If you believe the usual suspects on the right, it’s all the fault of liberals. Generous social programs, they insist, have created a culture of dependency and despair, while secular humanists have undermined traditional values. But (surprise!) this view is very much at odds with the evidence.

For one thing, rising mortality is a uniquely American phenomenon – yet America has both a much weaker welfare state and a much stronger role for traditional religion and values than any other advanced country. Sweden gives its poor far more aid than we do, and a majority of Swedish children are now born out of wedlock, yet Sweden’s middle-aged mortality rate is only half of white America’s.

You see a somewhat similar pattern across regions within the United States. Life expectancy is high and rising in the Northeast and California, where social benefits are highest and traditional values weakest. Meanwhile, low and stagnant or declining life expectancy is concentrated in the Bible Belt.

10/15

Perhaps the other takeaway from the 24/7 Wall St. compilation of rich and poor cities is actually a reminder of what a weird, contradictory place America is. The U.S. is an incredibly rich nation (and home to the world’s mostmillionaires) that has shameful levels of poverty. The gap between America’s richest and poorest citizens continues to widen, with the richest 20 percent of Americans possessing 84 percent of its wealth, and the poorest 40 percent owning just 0.3 percent. According to the United States Census Bureau, the poverty rate was 14.8 percent in 2014, which translates to 46.7 million Americans living in poverty. Keep in mind that poverty levels, as defined by the U.S. government, are absurdly low, starting at $11,770 for a single person and rising to $40,890 for a family of eight.

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Are Lessons from the 2014 Election Forgotten as the 2016 Campaigns Begin?

The 2014 midterms were marked by the lowest turnout since WWII and the most money spent – $3.8 billion. A deeper dive beneath the numbers revealed additional signs of trouble, as detailed in our recent report's "Five Facts You Didn’t Want to Know” sidebar. Check out the report here.

http://assets.opensecrets.org/downloads/2015_donor_report.pdf

The Five Facts You Didn’t Want to Know About the 2014 Midterms

The Political 1% of the 1% – just 31,976 Americans – gave $1.2 billion, or 29% of all disclosed spending in the 2014 cycle, up from 25% in 2012 and 21% in 2010 (see Chart 1), and such major donors are now able to give even larger amounts of money;

Outside spending, excluding the parties, rose 82% from 2010 to 2014, to $565 million, and such spending dominated many of the key congressional races (see Chart 2), whereas candidates were responsible for just 41% of the political money spent in 2014;

The number of donors to candidates in 2014 dropped 20% from the last midterm in 2010, while spending continued to rise (see Chart 3);

Dark money has grown dramatically, rising from $5 million in 2006 to $174 million in 2014 (after ballooning to more than $300 million in 2012, a presidential election year); and

Not only have dark money totals been rising, but for the first time, in 2014, single-candidate dark-money organizations became part of the equation.

815

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safety net shred 7/15

On the 80th anniversary of the Social Security Act of 1935, which established the social security system in the United States, President Franklin Delano Roosevelt’s New Deal is on life support as the American middle class continues to be squeezed and millions of Americans struggle with poverty.

The U.S. desperately needed a New Deal 3.0 after the crash of September 2008 and a program of aggressive reforms. Instead, most of the welfare that followed the Panic of 2008 has been corporate welfare rather than programs to help America’s embattled poor and middle class. Overall, the U.S. has been moving away from the New Deal when it should be reinvigorating it. Below are 10 ways in which the New Deal (and by extension, LBJ’s Great Society) continues to be under attack in the United States.

Income Inequality Is Going from Bad to Worse

FDR firmly believed that capitalism cannot function well without a strong middle class, and even auto magnate Henry Ford agreed with him: Ford famously said that American workers needed to be paid a decent wage in order to be able to afford his products. And during the post-FDR America of the 1950s and 1960s, having a robust middle class was great for a variety of businesses. But in 2015—with the gains of the New Deal having been imperiled by everything from union busting to the outsourcing of millions of American jobs—income inequality in the U.S. is a huge problem. The Organization for Economic Cooperation and Development recently released a report on income inequality among OECD members and found that the U.S. was among the worst offenders. The U.S., Mexico and Turkey had some of highest income inequality of OECD countries, while Denmark, the Czech Republic, Finland, Iceland and Belgium fared much better. OECD Secretary-General Angel Gurría commented that “high inequality is bad for growth,” and he’s absolutely right.

Republicans Yearn for Social Security Privatization

Although President Dwight D. Eisenhower was a Republican, he supported elements of the New Deal and saw the need for a strong social safety net: in fact, Eisenhower expanded social security, and in 1954, he bluntly asserted that any oligarchs who would “attempt to abolish social security, unemployment insurance and eliminate labor law and farm programs” were “stupid.” But in the 21st century, Republicans have been going after social security with a vengeance. The privatization of social security was proposed by President George W. Bush in 2004, and far-right Republicans, the Tea Party and wingnut lobbying groups like the Club for Growth have been doubling down on the idea of privatizing social security. GOP presidential hopeful Jeb Bush called for social security privatization at a town hall meeting in New Hampshire in June, and he also favors raising the social security retirement age to 69 or 70, which would be especially bad for blue-collar workers who have spent decades in physically demanding jobs.

The 1% Continue to Dodge Taxes

FDR had no problem asking the ultra-wealthy to pay their fair share of taxes: the U.S.’ top marginal tax rate rose to 94% in the early 1940s, when the country entered World War II. Taxes for the ultra-rich didn’t go down much under Republican Eisenhower, who lowered the top tax rate to 91% in the 1950s—and after that rate decreased to 28% under President Reagan, it rose to 39.6% under President Clinton and decreased to 35% under President George W. Bush. Looking at the last 80 years of tax history, one sees a clear pattern: the American middle class does much better when the 1% pay their fair share of taxes. And even though the Tea Party tries to paint Barack Obama as a soak-the-rich president, their assertion is laughable because Obama extended the Bush tax cuts and hasn’t been nearly as forceful as FDR or Eisenhower when it comes to taxing the 1%.

The Minimum Wage Is Much Too Low

One of the important elements of the New Deal was FDR’s strong belief in a national minimum wage. FDR began to push for a federal minimum wage after taking office in January 1933, saying, “By living wages, I mean more than a bare subsistence level. I mean the wages of a decent living.” And Congress enacted one in 1938, when the U.S.’ first federal minimum wage was set at 25 cents per hour. But in recent years, the federal minimum wage (which was raised to $7.25 an hour in 2009) has not kept up with inflation. Economist Robert Reich has proposed raising the federal minimum wage to $15 an hour, which he sees as a crucial part of economic recovery. And in some cities, including Los Angeles and Seattle, city councils have raised their local minimum wages to that amount. But at the federal level, an increase to even $10.10 an hour (President Obama’s proposal) is a steep uphill climb when both houses of Congress are dominated by far-right Republicans who hate the poor with a passion.

Infrastructure Continues to Deteriorate

The New Deal was great for the U.S.’ infrastructure thanks to programs that built or strengthened everything from roads to water and electric systems to municipal power plants. But in recent years, the American infrastructure has been seriously decaying—and a major wake-up call came on May 12, when an Amtrak train derailed in Philadelphia and eight passengers were killed. But the nation’s railways are only one of the ways in which the U.S.’ infrastructure has deteriorated. According to Ray LaHood (former secretary of transportation for the Obama Administration), 70,000 bridges in the U.S. are now structurally deficient. That is in addition to all the roads that are in desperate need of repair. And when it comes to high-speed rail travel, the U.S. lags way behind Europe (where one can get from London to Brussels in just under two hours or from Madrid to Barcelona in less than three hours).

Union Representation Has Reached Historic Lows

One of the most important pieces of New Deal-era legislation was the National Labor Relations Act of 1935, a.k.a. the Wagner Act, which did a lot to advance labor unions in the U.S.: by the mid-1950s, around 35% of America’s labor force was unionized. But according to the Bureau of Labor Statistics (BLS), a mere 11.1% of salaried U.S. workers (factoring in both the public and private sectors) were union members in 2014. Among private-sector workers, the number was a paltry 6.6%. And the decline of unions has been encouraged bad working conditions: according to the Economic Policy Institute, executives at large companies earned, on average, 296 times as much as their average workers in 2013 compared to only 20 times as much in 1965. But as much as labor unions have declined in the U.S., Wisconsin Gov. Scott Walker (a GOP presidential hopeful for 2016) and his fellow Republicans would like to see them decline even more. Walker recently set a disturbing precedent in that state when he supported anti-union legislation that prohibits private-sector unions from requiring members to pay union dues; Walker has, in essence, made Wisconsin a northern “right to work” state. And it’s safe to say that Walker, based on his actions in Wisconsin, would be among the most anti-union presidents in U.S. history.

“Too Big to Fail” Is Bigger Than Ever

Unlike many of today’s extreme-right Republicans and neoliberal corporatist Democrats, FDR was not afraid of offending the banking sector. FDR said of the banksters of the 1930s, “They are unanimous in their hate for me, and I welcome their hatred.” One of the New Deal achievements that banksters detested was the Glass-Steagall Act of 1933, which mandated a strict separation of commercial and investment banking and was designed to prevent another major Wall Street calamity like the crash of 1929. Glass-Steagall served the U.S. well for many years: although there were some tough recessions in the mid-1970s, early 1980s and early 1990s, none of them cut as deep as the Great Depression. But the repeal of Glass-Steagall in 1999 was a major blow to the New Deal and paved the way for the crash of September 2008, clearly the most devastating financial event in the U.S. since 1929. Unfortunately, there was no real banking reform after the 2008 calamity, and as Vermont Sen. Bernie Sanders points out, JPMorgan Chase, Bank of America and Wells Fargo are now “80% larger” than they were in 2007. Critics of the banking sector propose bringing back Glass-Steagall, including Reich (who warns that another major Wall Street crash “is not unlikely”) and Massachusetts Sen. Elizabeth Warren. And Sanders has proposed New Deal-like legislation that would break up the U.S.’ largest banks.

Medicare, An Expansion of the New Deal, Is a Major GOP Target

Medicare, which established a single-payer health care system for Americans 65 and older, was not part of the New Deal per se: Medicare came into being in 1965 as part of Democratic President Lyndon B. Johnson’s Great Society (which was very much an extension of the New Deal). And the program proved to be so popular that even Republican President Richard Nixon (who was considered an arch-conservative in his day) expanded Medicare in both 1969 and 1972. But these days, far-right GOP wingnuts in the House of Representatives—especially Rep. Paul Ryan, chairman of the House Ways and Means Committee—have repeatedly called for drastic Medicare cuts and for replacing traditional Medicare with a privatized voucher program. In June, a variety of pro-Medicare groups (including the Alliance for Retired Americans and the Medicare Rights Center) sent a joint letter to the House criticizing representatives who wanted to cut $700 million from the Medicare program.

Home Ownership Is Becoming Increasingly Difficult for Many Americans, and the Rent Is Too Damn High

Before the New Deal, five-year or 10-year mortgages were the norm in the U.S., and were unaffordable for most Americans. But FDR saw home ownership as a crucial part of building a strong middle class: between the Federal Housing Administration, the Home Owners’ Loan Corporation and the introduction of 30-year fixed-rate mortgages—all of which came about under FDR—home ownership in the U.S. gradually increased. According to the U.S. Census Bureau, home ownership in the U.S. went from 45% in 1920 and 47% in 1930 to 55% in 1950, 61% in 1960 and 62% in 1970. But the Crash of 2008 has been terrible for American homeowners, resulting in countless foreclosures, and banksters have been allowed to acquire and rent out many foreclosed homes. The private equity firm Blackstone Group had, as of late 2013, bought almost 40,000 homes in the U.S. in order to rent them. To make matters worse, all those post-2008 foreclosures have caused rents to skyrocket all over the country. And the more one pays in rent, the harder it is to save for a down payment on a home. To quote Jimmy McMillan, the rent is too damn high.

Wingnut Attacks on Food Stamps Never End

The American food stamps program started on a pilot basis under FDR’s secretary of agriculture, Henry A. Wallace, in 1939 but became permanent when LBJ signed the Food Stamp Act of 1964 into law as part of his Great Society. In recent years, the U.S.’ economic decline has been so painful that, according to the U.S. Department of Agriculture, the number of Americans poor enough to quality for food stamps was 46.2 million in 2014 compared to only 17 million in 2000. Food stamps, as envisioned under the New Deal and the Great Society, are designed to be a stepping stone for the poor—and the benefits (which presently average $127.91 per month per person, according to USDA figures) are hardly lavish. But that has not prevented Republicans in Congress from repeatedly proposing dramatic food stamp cuts during the Great Recession. And in Wisconsin, Gov. Scott Walker has been trying to punish and shame food stamp recipients by subjecting them to drug-testing.

Alex Henderson's work has appeared in the L.A. Weekly, Billboard, Spin, Creem, the Pasadena Weekly and many other publications. Follow him on Twitter @alexvhenderson.

http://www.alternet.org/economy/35-mind-blowing-facts-about-inequality

...United States was not always the most powerful nation on Earth. It was only with the end of World War II, with the rest of the developed world in smoldering ruins, that America emerged as the free world’s leader. This coincided with the expansion of the U.S. middle class. With the other war combatants trying to recover from the destruction of the war, America became the supermarket, hardware store and auto dealership to the world. Markets for American products abounded and opportunity was everywhere for American workers of all economic means to get ahead. America had a virtual monopoly on rebuilding the world. Combined with the G.I. Bill of 1944, which provided money for returning veterans to go to college, and government loans to buy houses and start businesses, the middle class in America boomed, as did American power, wealth and prestige. Between 1946 and 1973, productivity in America grew by 104 percent. Unions led the way in assuring wages for workers grew by an equal amount.

The 1970s, however, brought a screeching halt to the expansion of the American middle class. The Arab oil embargo in 1973 marked the end of cheap oil and the beginning of the middle-class decline. The Iranian Revolution in 1979, with more resultant oil instability, combined with the rise of Ronald Reagan’s conservative revolution at home, accelerated the long and painful contraction of the middle class. Cuts in corporate taxes, stagnant worker wage growth, the right-wing war on unions, and corporate outsourcing of work overseas greased the wheels of the middle-class decline and the upper-class elevation. Cuts in taxes on the wealthy, under the guise of trickle-down economics, have resulted in lower government revenue and cuts to all kinds of services. All of which has led to today, an era of national and international inequality unparalleled since the days of the Roaring '20s.

Here are 35 astounding facts about inequality that will fry your brain.

In 81 percent of American counties, the median income, about $52,000, is less than it was 15 years ago. This is despite the fact that the economy has grown 83 percent in the past quarter-century and corporate profits have doubled. American workers produce twice the amount of goods and services as 25 years ago, but get less of the pie.

The amount of money that was given out in bonuses on Wall Street last year is twice the amount all minimum-wage workers earned in the country combined.

The wealthiest 85 people on the planet have more money that the poorest 3.5 billion people combined.

The average wealth of an American adult is in the range of $250,000-$300,000. But that average number includes incomprehensibly wealthy people like Bill Gates. Imagine 10 people in a bar. When Bill Gates walks in, the average wealth in the bar increases unbelievably, but that number doesn’t make the other 10 people in the bar richer. The median per adult number is only about $39,000, placing the U.S. about 27th among the world’s nations, behind Australia, most of Europe and even small countries like New Zealand, Ireland and Kuwait.

Italians, Belgians and Japanese citizens are wealthier than Americans.

The poorest half of the Earth’s population owns 1% of the Earth’s wealth. The richest 1% of the Earth’s population owns 46% of the Earth’s wealth.

More locally, the poorest half of the US owns 2.5% of the country’s wealth. The top 1% owns 35% of it.

Inequality is a worldwide problem. In the UK, doctors no longer occupy a place in the top 1% of income earners, London plays host to the largest congregation of Russian millionaires outside of Moscow, and also houses more ultra-rich people (defined as owning more than $30 million in assets outside of their home) than anywhere else on Earth.

The slice of the national income pie going to the wealthiest 1% of Americans has doubled since 1979.

The 1% also takes home 20% of the income. This figure is the most since the 1920s era of laissez faire government (under Republicans Warren Harding, Calvin Coolidge and Herbert Hoover).

The super rich .01% of America, such as Jamie Dimon, CEO of JP Morgan, take home a whopping 6% of the national income, earning around $23 million a year. Compare that to the average $30,000 a year earned by the bottom 90 percent of America.

The top 1% of America owns 50% of investment assets (stocks, bonds, mutual funds). The poorest half of America owns just .5% of the investments.

The poorest Americans do come out ahead in one statistic: the bottom 90% of America owns 73% of the debt.

Tax rates for the middle class have remained essentially unchanged since 1960. Tax rates on the highest earning Americans have plunged from an almost 70% tax rate in 1945 down to around 35% today. Corporate tax rates have dropped from 30 percent in the 1950s to under 10 percent today.

Since 1990, CEO compensation has increased by 300%. Corporate profits have doubled. The average worker's salary has increased 4%. Adjusted for inflation, the minimum wage has actually decreased.

CEOs in 1965 earned about 24 times the amount of the average worker. In 1980 they earned 42 times as much. Today, CEOs earn 325 times the average worker.

Wages, as a percent of the overall economy, have dropped to an historic low.

In a study of 34 developed countries, the United States had the second highest level of income inequality, after Chile.

Young people in the U.S. are getting poorer. The median wealth of people under 35 has dropped 68% since 1984. The median wealth of older Americans has increased 42%.

The average white American’s median wealth is 20 times higher($113,000) than the average African American ($5,600) and 18 times the Hispanic American ($6,300).

America’s highest incomeinequality is located in the states surrounding Wall Street (New York City) and the oil-rich states.

Since 1979, high school dropouts have seen median weekly income drop by 22 percent. Ethnically, the highest dropout rates are among Hispanic and African American children.

In 1970, a woman earned about 60% of the amount a man earned. In 2005 a woman earned about 80% of what a man earned. Since 2005, there has been no change in that figure. African-American women earn just 64% of what a white male earns, and Hispanic women just 56%.

Over 20 percent of all American children live below the poverty line. This rate is higher than almost all other developed countries.

Union membership in the US is at an all-time low, about 11% of the workforce. In 1978, 40 percent of blue-collar workers were unionized. With that declining influence has come a concurrent decline in the real value of the minimum wage.

Four hundred Americans have more wealth, $2 trillion, than half of all Americans combined. That is approximately the GDP of Russia.

In 1946, a child born into poverty had about a 50 percent chance of scaling the income ladder into the middle class. In 1980, the chances were 40 percent. A child born today has about a 33 percent chance.

Despite massive tax cuts, corporations have not created new jobs in America. The job creators have been small new businesses that have not enjoyed the same huge tax breaks.

More than half of the members of the United States Congress, where laws are passed deciding how millionaires are taxed, are millionaires.

Twenty five of the largest corporations in America in 2010 paid their CEOs more money than they paid in taxes that year.

In the first decade of the 21st century, the U.S. borrowed $1 trillion in order to give tax cuts to households earning over $250,000.

In 1970, there were five registered lobbyists working on behalf of wealthy corporations for every one of the 535 members of Congress. Today there are 22 lobbyists per congressperson.

In 1962, the 1% household median wealth was 125 times the average median wealth. In 2010 the divide was 288 times.

During the Great Recession, the average wealth of the 1% dropped about 16 percent. Meanwhile the wealth of the 99% dropped 47 percent.

Between 1979 and 2007, the wages of the top 1% rose 10 times more than the bottom 90 percent.

Larry Schwartz is a Brooklyn-based freelance writer with a focus on health, science and American history.

may recall how in 2013 — and then again in 2015 — President Obama tried to give his economic vision a snazzy name, something to compete with “trickle-down economics” in terms of memorability and pith. What he came up with, and has stuck with since, is “middle-out economics,” or sometimes “middle-class economics,” which is supposed to communicate his and the Democratic Party’s commitment to seeing the middle class — and not the 1 percent — as the true fount of economic growth.

But although Obama and other Democrats are evidently happy enough with the branding, the actual policy approach that defines a middle-out economics has remained somewhat fuzzy. And that’s where “Hollowed Out: Why the Economy Doesn’t Work without a Strong Middle Class,” the new book from the Center for American Progress’s David Madland, steps in. While politicians’ focus on the middle class can sometimes feel like empty pandering, Madland’s book makes a strong and clear argument that an economy geared around the middle class is not only more in keeping with democratic and liberal norms, but it’s simply better economics, too.

Recently, Salon spoke over the phone with Madland about his book, inequality, and what he sees as the right economic agenda for liberalism in the 21st century. Our conversation is below and has been edited for clarity and length.

When did you start thinking about a strong middle class as not only a good thing unto itself but as a necessary component of keeping the U.S. economy healthy?

It actually started way back when I was in high school.

I coached baseball camps throughout the summers, and I had this sense that in the more middle-class neighborhoods where we would do the camps — because we would move all around — things worked better. The kids would immediately trust each other and knew how to work together well. So I had this germ of an idea, way back then, that there was something about a strong middle class that led to better outcomes.

What kind of outcomes do you have in mind?

One of the key things is that a strong middle class leads to greater trust, and trust might seem a bit abstract, but, really, it’s essential to any functioning economy and society. You need to be able to work with people that you don’t already know, that aren’t part of your family, etc.

You can see over the past several decades that trust has declined sharply in the U.S., and a key factor in that has been rising inequality, because people have far different experiences — or they don’t think others are like them.

Some of the costs of that [lack of trust] for our society — think of the number of lawyers we have.

The share of lawyers in our economy has doubled over the past several decades. It was steady from the early 1900s to the ‘60s, and since inequality started rising, the share of lawyers in the economy has risen sharply. While lawyers might do important things, they really are just a cost, a burden that makes business transactions harder.

I want to continue on this trust theme in a moment, but first I wanted to ask you to explain why the trickle-down theory of economic management is wrong.

The underlying idea behind trickle-down, really, is that high levels of economic inequality are good and that if you help the rich get richer through things like tax cuts and less regulation, that will buy some greater economic growth.

The premise that inequality is good is fundamentally wrong. It might be true in a very narrow sense that, yes, [it provides] some incentive to work harder; but that ignores the larger context. When inequality gets to extreme levels, you have all these harms that happen as a result. I talked about trust; you have governance getting corrupted, you have fewer people able to develop their human capital. And you also have weakening of demand, which we saw that in the Great Recession’s aftermath.

Okay, so how does that kind of extreme inequality result in lower levels of trust?

The basic idea behind trust is this idea of reciprocity. You do unto others as they would do unto you. They treat you well, you treat them well. If they don’t treat you well, you know, an eye for an eye. Behind that is this idea that you think you share things in common. Inequality erodes that idea. [It makes] you think people are far less like you.

We can see the evidence for this in lots of different ways. In one of the studies that I think is most interesting, [researchers] left a wallet in cities throughout the world. In regions that had greater inequality, fewer wallets were returned. What’s happening is people think [other] people are not like them when they live in an unequal society; and they’re less likely to trust them, which leads to all sorts of harmful consequences.

You mentioned how lack of trust hurts the cause of good governance. How so?

If you look back into our history, there are some really scary parallels [to our current situation], and the best parallel, I think, is the pre-Civil War South.

That was a very unequal society; the top 1 percent used their power not just to suppress blacks, but to suppress the political power of [most] whites, so that the 1 percent wouldn’t have to pay taxes to fund things like education and infrastructure. That kept the region poor for some period of time, and I fear that the political power of the 1 percent today, which is focused really on keeping their taxes low, is hindering important investments in our future.

To your point, the public polling we have of the 1 percent indicates they care much less about basic good government initiatives, like infrastructure and education, than most Americans do.

Yes. It’s certainly hard to poll the very wealthy, but all of the evidence shows that the wealthy have placed the most importance on lowering their taxes. They’re even willing to cut vital government programs like education and infrastructure to avoid having to pay higher taxes.

One of the most telling polls had some questions about how important do they think education is. Do they think it’s important that everyone has a good school? Do they think it’s important that a government fund quality education for all people? Questions like that. The discrepancy between the importance that the wealthy placed on [these investments] and that everyone else placed on them was shocking. The things that the middle class really needs and cares about, like these basic public goods, education and infrastructure‚ are discounted by the wealthy.

They might give lip service to them, but they’re just not that important to them. They have other options; they can send their kids to private school, for example. So they really focus on keeping taxes low, and as a result, we all bear the consequences of a country that’s not making the kind of spending decisions it needs to be making.

You argue that part of the reason the recovery from the Great Recession has been so difficult and slow is because the middle class was struggling with debt and, consequently, stopped putting their money back into the economy. But what if we had a consumer economy that was simply geared toward the very rich? Couldn’t they fill that demand deficit?

That’s basically the economy we have right now; and it’s not working very well.

More importantly, the underlying idea is that, typically, the wealthy save a higher percentage of their money than do the middle class and the poor. For example, wealthy people spend a fair amount of money on cars; but there’s only so many cars they can have.

With the middle class or the poor, most of the additional money they get, they spend. This marginal propensity to consume means that if all the money is going to the top, there’s not enough consumption in the economy.

Let’s talk solutions. If I could make you King of America tomorrow and give you absolute power, what would you do first to fix the economy?

The initial goal is changing the mindset toward recognizing that the middle class is this valuable thing that will lead to a good economy in the future, and that we need to rebuild it.

Once we create that realization, there are several things we need to do. First, we need to fix our democracy so that everyone has a more equal voice. That means things like getting money out of politics — or at least equalizing the power of money by enabling and encouraging more people to register and vote.

Then there’s a host of things that we can do to directly improve the ability for the middle class and all of society to get ahead; I’m talking about things like investments in universal preschool, making it much easier for people to join a union, raising the minimum wage, and enforcing our laws [against wage theft]. I also would start to promote things like profit sharing, so when companies do well, workers also benefit.

I can go on and on and on, but I think the key thing is to change people’s minds about how they think about strengthening the middle class. It’s not just something nice to do; it’s really essential for our future growth.

http://www.alternet.org/civil-liberties/orange-county-family-paid-72k-keep-son-upgraded-jail-cell-after-he-killed-girl-while

CIVIL LIBERTIES alternet

Orange County Family Paid $72K to Keep Son in Upgraded Jail Cell After he Killed Girl While Drunk Driving

They paid over $72,000 for an upgraded cell.

By Tom Boggioni / Raw Story May 2, 2015

Contrary to the concept of “equal justice for all,” multiple Southern California cities offer upgraded jail cells with phones, DVD players, and full-sized refrigerators to offenders who can afford the daily rate, reports KNBC.

The family of one Seal Beach man paid over $72,000 for an upgraded cell, away from the general population, while he served 2-years for killing a classmate after crashing his car while driving drunk.

Called “pay-to-stay,” the cells can be found in Seal Beach, Anaheim, Arcadia, Burbank, Glendale, Huntington Beach, Pasadena, Santa Ana and Torrance, at nightly rates of $127 to $143. In some cities, the non-violent offender’s cell doors are not locked, and the prisoners are free to come and go to their jobs on a daily basis.

In Anaheim, inmates in the city’s pay-to-stay jail program are able to check out their own DVD players for their cell, and work out in a nice gym for a price.

The city of Fullerton offers one upgraded cell where inmates who can afford the $127 a night gets their own TV, a telephone in the cell, and a personal full-size refrigerator.

“Bottom line — if you don’t have the money, you’re not going to be able to stay,” explained Det. Laura Lomeli, who added that the cells are for “Good people who made a mistake, made a bad choice — and they have to pay the consequences.”

According to Peter Eliasberg, legal director for the ACLU of Southern California, “What a terrible idea. What a slap in the face for the concept of equal justice for all. If it’s a public service — that should be offered to everyone regardless of their ability to pay.”

Michael Keating, of Seal Beach, was intoxicated and at the wheel in 2010 when he crashed, killing Mai Hayakawa instantly.

Mai’s mother, Chiho Hayakawa, was stunned to find out that Keating — who never apologized for his action — got off so easy in jail after killing her daughter.

“I was so shocked,” she said. “I feel his solution comes from money.”

The Super-Wealthy 18

Posted by ELI SANDERS on April 26 at 13:37 PM

Yesterday the watchdog groups Public Citizen and United for a Fair Economy released this report on the 10-year “stealth campaign” by certain super-wealthy families to repeal the Estate Tax. The report names two prominent local families and, according to the press release…

…details for the first time the vast money, influence and deceptive marketing techniques behind the rhetoric in the campaign to repeal the tax. It reveals how 18 families worth a total of $185.5 billion have financed and coordinated a 10-year effort to repeal the estate tax, a move that would collectively net them a windfall of $71.6 billion.

Can you guess which local families? Here’s the list:

Allyn-Soderberg Family (Welch Allyn Inc.)

Blethen Family (Seattle Times Co.)

Cox Family (Cox Enterprises, Inc.)

DeVos and Van Andel Families (Alticor/Amway)

Dorrance Family (Campbell Soup Company)

Gallo (E&J Gallo Winery)

Harbert Family

Johnson Family (BET, RLJ Development Co.)

Koch Family (Koch Industries)

Mars Family (Mars Inc.)

Mayer Family (Captiva Resources)

Nordstrom Family (Nordstrom Inc.)

Sobrato Family (Sobrato Development)

Stephens Family (Stephens Inc.)

Timken Family (The Timken Company)

Walton Family (Wal-Mart)

Wegman Family (Wegmans Food Markets, Inc.)

kos 4/15

In 2008, the campaign of multi-millionaire John McCain tried to brand Barack Obama as "elitist" and "out of touch" and "worried about the price of arugula." Four years later, Mitt Romney--the GOP presidential nominee worth at least a quarter of a billion dollars--declared that President Obama "reminded me of Marie Antoinette." Now, Politico tells us, the GOP is planning to "turn Hillary into Mitt Romney":

Republicans are readying a familiar template: The out-of-touch plutocrat who lives in a world of private planes, chauffeured vehicles and million-dollar homes.

But the Republicans' pathetic populist ploy is backfiring. After all, the now-wealthy Clintons have long supported policies to help working Americans. And while Hillary Clinton has put her money where her mouth is by backing increases in the taxes her family pays, the GOP and its 2016 candidates are--as always--calling for a massive, Treasury draining, tax cut windfall for the wealthy.

Capitals Gains Taxes. At the 2012 Democratic National Convention, former President Bill Clinton explained what Republican control of the White House would mean for Americans' tax bills. "They'll hurt the middle class and the poor and put the future on hold to give tax cuts to upper-income people who've been getting it all along."

Four years later, the GOP's declared candidates are once again proving him right. Both Rand Paul and Marco Rubio would repeal the estates and gift taxes, while reducing the rate on capital gains and dividend income to zero.

Low capital gains tax rates have been one of the biggest drivers of income inequality. In 2011, the Washington Post explained why:

Continue reading about the GOP's pathetic populist ploy below.

While it's true that many middle-class Americans own stocks or bonds, they tend to stash them in tax-sheltered retirement accounts, where the capital gains rate does not apply. By contrast, the richest Americans reap huge benefits. Over the past 20 years, more than 80 percent of the capital gains income realized in the United States has gone to 5 percent of the people; about half of all the capital gains have gone to the wealthiest 0.1 percent.

Secretary Clinton knows this all too well, and not just because her husband was one of those who delivered "a Christmas present" to the rich when he reduced the capital gains tax rate from 28 to 20 percent in 1998. As she explained yesterday in Iowa, "there's something wrong when hedge fund managers pay less in taxes than nurses or the truckers I saw on I-80."

Private Equity and Hedge Funds. As it turns out, Hillary Clinton's son-in-law is a hedge fund manager. But she's more than willing make him pay more to Uncle Sam by ending the "carried interest" tax exemption that allows Mitt Romney and his ilk to escape millions in assessments each year. As the New York Times reported in 2007:

Senator Clinton, speaking at a rally in New Hampshire, called for ending a "glaring inequity" that allows investment managers in certain partnerships to take large amounts of their compensation in the form of performance fees or "carried interest," which is taxed at the 15 percent capital gains rate rather than at income tax rates as high as 35 percent.

The carried interest tax break is one reason why private equity titans like Mitt Romney can reap huge profits from investments even when those companies fail. And private equity is one reason why Jeb Bush may run into some of the same roadblocks Mitt Romney did. Just ask Mitt Romney:

He has said, among other things, that Jeb Bush, the former Florida governor, would run into problems because of his business dealings, his work with the investment banks Lehman Brothers and Barclays, and his private equity investments.

"You saw what they did to me with Bain [Capital]," he has said, referring to the devastating attacks that his Republican rivals and President Barack Obama's team launched against him for his time in private equity, according to three sources familiar with the line. "What do you think they'll do to [Bush] over Barclays?"

Estate Tax. Another problem Jeb Bush faces with some voters is the concern over dynastic wealth fueling dynastic political power. But Bush won't face those that worry from Republican voters, including in the GOP's supposed Tea Party wing. After all, Congressional Republicans, the 2016 GOP presidential field and most of the rank and file support ending the estate tax.

This week, Capitol Hill Republicans voted once again to end what they call the "death tax." But despite the mythology of GOP leaders like Speaker John Boehner ("People who aren't wealthy, who may have built up value in land over generations and many family farms find themselves in situations where they've got to sell the farm in order the pay the taxes"), only two out of 1,000 estates will even have to pay the tax in 2015. As the Center on Budget and Policy Priorities (CBPP) documented, the supposed deficit-hawks of the GOP would add about $270 billion in new red ink over the next decade in order to keep the bank accounts of the richest heirs in the nation off-limits to Uncle Sam:

The federal estate tax is a tax on property (cash, real estate, stock, or other assets) transferred from deceased persons to their heirs. Only the wealthiest estates pay the tax because it is levied only on the portion of an estate's value that exceeds a specified exemption level -- $5.43 million per person (effectively $10.86 million per married couple) in 2015.[2] The estate tax thus limits, to a modest degree, the large tax breaks that extremely wealthy households get on their wealth as it grows, which can otherwise go untaxed.

Like many wealthy Americans, Hillary and Bill Clinton utilize a range of strategies for limiting their estate tax exposure. But while 99.8 of families don't have to pay the estate tax at all, the Clintons are among the 0.02 percent who will.

Unless, that is, a Republican becomes President of the United States.

Robert Reich: The Wealthy Have Pulled America Back to the 19th Century

By Robert Reich [1] / AlterNet [2]

February 10, 2015

My recent column about the growth of on-demand jobs like Uber making life less predictable and secure for workers unleashed a small barrage of criticism from some who contend that workers get what they’re worth in the market.

A Forbes Magazine contributor, for example, writes [3] that jobs exist only “when both employer and employee are happy with the deal being made.” So if the new jobs are low-paying and irregular, too bad.

Much the same argument was voiced in the late nineteenth century over alleged “freedom of contract. [4]” Any deal between employees and workers was assumed to be fine if both sides voluntarily agreed to it.

It was an era when many workers were “happy” to toil twelve-hour days in sweat shops for lack of any better alternative.

It was also a time of great wealth for a few and squalor for many. And of corruption, as the lackeys of robber barons deposited sacks of cash on the desks of pliant legislators.

Finally, after decades of labor strife and political tumult, the twentieth century brought an understanding that capitalism requires minimum standards [5] of decency and fairness – workplace safety, a minimum wage, maximum hours (and time-and-a-half for overtime), and a ban on child labor.

We also learned that capitalism needs a fair balance of power between big corporations and workers.

We achieved that through antitrust laws that reduced the capacity of giant corporations to impose their will, and labor laws that allowed workers to organize and bargain collectively.

By the 1950s, when 35 percent [6]of private-sector workers belonged to a labor union, they were able to negotiate higher wages and better working conditions than employers would otherwise have been “happy” to provide.

But now we seem to be heading back to nineteenth century.

Corporations are shifting full-time work onto temps, free-lancers, and contract workers who fall outside the labor protections established decades ago.

The nation’s biggest corporations and Wall Street banks are larger and more potent than ever.

And labor union membership has shrunk to fewer than 7 percent of private-sector workers.

So it’s not surprising we’re once again hearing that workers are worth no more than what they can get in the market.

But as we should have learned a century ago, markets don’t exist in nature. They’re created by human beings. The real question is how they’re organized and for whose benefit.

In the late nineteenth century they were organized for the benefit of a few at the top.

But by the middle of the twentieth century they were organized for the vast majority.

During the thirty years after the end of World War II, as the economy doubled in size, so did the wages of most Americans — along with improved hours and working conditions.

Yet since around 1980, even though the economy has doubled once again (the Great Recession notwithstanding), the wages most Americans have stagnated. And their benefits and working conditions have deteriorated.

This isn’t because most Americans are worth less. In fact, worker productivity is higher [7] than ever.

It’s because big corporations, Wall Street, and some enormously rich individuals have gained political power to organize the market in ways that have enhanced their wealth while leaving most Americans behind.

That includes trade agreements [8] protecting the intellectual property of large corporations and Wall Street’s financial assets, but not American jobs and wages.

Bailouts of big Wall Street banks and their executives and shareholders when they can’t pay what they owe, but not of homeowners who can’t meet their mortgage payments.

Bankruptcy protection for big corporations, allowing them to shed their debts, including labor contracts. But no bankruptcy protection for college graduates over-burdened with student debts.

Antitrust leniency toward a vast swathe of American industry – including Big Cable (Comcast, AT&T, Time-Warner), Big Tech (Amazon, Google), Big Pharma, the largest Wall Street banks, and giant retailers (Walmart).

But less tolerance toward labor unions — as workers trying to form unions are fired with impunity, and more states adopt so-called “right-to-work” laws [9] that undermine unions.

We seem to be heading full speed back to the late nineteenth century.

So what will be the galvanizing force for change this time?

Robert B. Reich has served in three national administrations, most recently as secretary of labor under President Bill Clinton. He also served on President Obama's transition advisory board. His latest book is "Aftershock: The Next Economy and America's Future." His homepage is www.robertreich.org [10].

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Source URL: http://www.alternet.org/robert-reich-wealthy-have-pulled-america-back-19th-century

Links:

[1] http://www.alternet.org/authors/robert-reich-0

[2] http://alternet.org

[3] http://www.forbes.com/sites/jeffreydorfman/2015/02/07/robert-reich-former-labor-secretary-does-not-understand-labor-markets/

[4] https://books.google.com/books?id=YGYnOoOJTXcC&pg=PA10&lpg=PA10&dq=late+nineteenth+century+freedom+of+contract&source=bl&ots=V4HIB5FAtD&sig=gTkEuvWwCC6j3nBxZjzKHjMbkAU&hl=en&sa=X&ei=3fjYVJq2EcH6oQSEvYLwBw&ved=0CD0Q6AEwBQ#v=onepage&q=late%20nineteenth%20century%20freedom%20of%20contract&f=false

[5] http://www.dissentmagazine.org/online_articles/the-bare-minimum-labor-standards-and-american-inequality

[6] http://www.nytimes.com/2013/01/24/business/union-membership-drops-despite-job-growth.html?_r=0

[7] http://www.bls.gov/lpc/

[8] http://www.theguardian.com/business/2015/jan/20/barack-obama-trans-pacific-partnership-republicans

[9] http://www.motherjones.com/politics/2012/03/what-are-right-to-work-laws

[10] http://www.robertreich.org

[11] mailto:corrections@alternet.org?Subject=Typo on Robert Reich: The Wealthy Have Pulled America Back to the 19th Century

[12] http://www.alternet.org/

[13] http://www.alternet.org/%2Bnew_src%2B

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[http://www.ted.com/speakers/james_b_glattfelder James Glattfelder studies complexity]: how an interconnected system — say, a swarm of birds — is more than the sum of its parts. And complexity theory, it turns out, can reveal a lot about how the economy works. Glattfelder shares a groundbreaking study of how control flows through the global economy, and how concentration of power in the hands of a shockingly small number leaves us all vulnerable. TEDtalk.

chart http://krugman.blogs.nytimes.com/2015/01/01/recent-history-in-one-chart/?_r=1

http://www.alternet.org/economy/paul-krugman-how-soaring-inequality-may-lead-world-down-path-fascism

http://www.alternet.org/economy/10-economic-trends-spell-doom-americas-workers?paging=off¤t_page=1#bookmark

http://www.alternet.org/culture/get-out-while-you-can-why-young-americans-should-consider-moving-abroad

AlterNet [1] / By Paul Buchheit [2]

5 Facts About How America Is Rigged for a Massive Wealth Transfer to the Rich

November 4, 2014 |

A recent posting [3] detailed how upper middle class Americans are rapidly losing ground to the one-percenters whoaveraged $5 millionin wealth gains over just three years. It also noted that the global 1% has increased their wealth from $100 trillion to $127 trillion in just three years.

The information came from the Credit Suisse [4] 2014 Global Wealth Databook (GWD), which goes on to reveal much more about the disappearing middle class.

Each Year Since the Recession, America's Richest 1% Have Made More Than the Cost of All U.S. Social Programs

In effect, a reverse transfer from the poor to the rich. Even as conservatives blame Social Security for being too costly.

Much of the 1% wealth just sits there, accumulating more wealth. The numbers are nearly unfathomable. Depending on the estimate, the 1% took in anywhere from $2.3 trillion to $5.7 trillion per year. (All numeric analysis is detailed here [5].)

Even the smaller estimate of $2.3 trillion per year is more than the budget [6] for Social Security ($860 billion), Medicare ($524 billion), Medicaid ($304 billion), and the entire safety net [7] ($286 billion for SNAP, WIC [Women, Infants, Children], Child Nutrition, Earned Income Tax Credit, Supplemental Security Income, Temporary Assistance for Needy Families, and Housing).

Almost None of the New 1% Wealth Led To Innovation and Jobs

In 2005, for every $1 of financial wealth there was 66 cents of non-financial (home) wealth. Ten years later, for every $1 of financial wealth there was just 43 cents of non-financial (home) wealth.

What happens to all this financial wealth?

Over 90% of the assets [8] owned by millionaires are held in low-risk investments (bonds and cash), the stock market, and real estate. Business startup [9] costs made up less than 1% of the investments of high net worth individuals in North America in 2011. A recent study [10] found that less than 1 percent of all entrepreneurs came from very rich or very poor backgrounds. They come from the middle class.

On the corporate side, stock buybacks are employed to enrich [11] executives rather than to invest in new technologies. In 1981 [12], major corporations were spending less than 3 percent of their combined net income on buybacks, but in recent [13] years [14] they've been spending up to 95 percent of their profits on buybacks and dividends.

Just 47 Wealthy Americans Own More Than Half of the U.S. Population

Oxfam [15] reported that just 85 people own as much as half the world. Here in the U.S., with nearly a third of the world's wealth, just 47 individuals own more than all 160 million people (about 60 million households) below the median wealth level of about $53,000.

The Upper Middle Class of America Owns a Smaller Percentage of Wealth Than the Corresponding Groups in All Major Nations Except Russia and Indonesia.

The upper middle class in the U.S., defined as everyone in the top half below the richest 20%, owns 11.9 percent [5] of the wealth. Indonesia at 10.5 percent and Russia at 7.5 percent are worse off, but in all other nations the corresponding upper middle classes own 12 to 27 percent of the wealth.

America's bottom half compares even less favorably to the world: dead last, with just 1.3 percent of national wealth. Only Russia comes close to that dismal share, at 1.9 percent. The bottom half in all other nations own 2.6 to 10.2 percent of the wealth.

Ten Percent of the World's Total Wealth Was Taken by the Global 1% in the Past Three Years

As in the U.S., the middle class is disappearing at the global level. An incredible one of every ten dollars of global wealth [5] was transferred to the elite 1% in just three years. A level of inequality deemed unsustainable three years ago has gotten even worse.

Solution: A Financial Transaction Tax (FTT)

More appropriately called a Financial Speculation Tax, it would help to limit the speculative trading [16] that contributed to the financial meltdown in 2008.

The FTT has extraordinary revenue-generating potential, on a global scale. The Bank for International Settlements reported in 2008 that annual trading in derivatives had surpassed $1.14 quadrillion [17]. Just one-tenth of one percent of that is a trillion dollars.

It's also a fair tax. While average Americans pay up to a 10% sales tax [18] on shoes for the kids, millionaire investors pay [19] a zero sales tax on financial purchases. They pay just a .00002% [20] SEC fee [21] (2 cents for every thousand dollars) for a financial instrument.

In addition, the FTT is easy to administer and difficult to evade. Clearing houses already review all trades, and serve as collection agencies for transaction fees.

And as evidence of its suitability, three of the top five countries on the Heritage Foundation's Index of Economic Freedom [22] are Singapore, Hong Kong, and Switzerland, all of whom have FTTs.

People in the U.S. and around the world are being rapidly divided into two classes, the well-to-do and the lower-income majority. This severing of society will change only when progressive thinkers (and doers) agree on a single, manageable solution that will stop the easy flow of wealth to the privileged few.

See more stories tagged with:

economy [24],

rich [25],

wealthy [26],

1 percent [27],

Financial Speculation Tax [28]

Source URL: http://www.alternet.org/economy/5-facts-about-how-america-rigged-massive-wealth-transfer-rich

Links:

[1] http://alternet.org

[2] http://www.alternet.org/authors/paul-buchheit

[3] http://www.alternet.org/economy/stark-facts-global-greed-disease-challenging-climate-change

[4] https://www.credit-suisse.com/ch/en/news-and-expertise/research/credit-suisse-research-institute/publications.html

[5] http://www.usagainstgreed.org/20141103_Analysis.txt

[6] http://www.whitehouse.gov/sites/default/files/omb/budget/fy2014/assets/tables.pdf

[7] http://www.UsAgainstGreed.org/20140120_Analysis.txt

[8] http://www.marketwatch.com/story/where-the-rich-are-keeping-their-money-2011-06-24

[9] http://www.commondreams.org/views/2012/05/29/how-job-creators-really-spend-their-money

[10] http://cdn.americanprogress.org/wp-content/uploads/issues/2012/05/pdf/middleclass_growth.pdf

[11] http://fiid.org/wp-content/uploads/2012/10/Lazonick-Financialization-of-the-US-Corporation-20121029.pdf

[12] http://www.alternet.org/economy/154746/how_high_ceo_pay_hurts_the_99_percent/?page=entire

[13] http://www.bloomberg.com/news/2014-10-06/s-p-500-companies-spend-almost-all-profits-on-buybacks-payouts.html

[14] http://www.washingtonpost.com/business/economy/companies-turning-again-to-stock-buybacks-to-reward-shareholders/2013/12/15/58a2e99c-4aef-11e3-9890-a1e0997fb0c0_story.html

[15] http://www.oxfam.org/sites/www.oxfam.org/files/bp-working-for-few-political-capture-economic-inequality-200114-en.pdf

[16] http://www.nytimes.com/2012/10/02/opinion/putting-the-brakes-on-high-frequency-trading.html?_r=0

[17] http://www.rense.com/general91/tobin.htm

[18] http://www.forbes.com/2011/02/17/average-sales-tax-rate-record-high-shopping-arizona-25-highest-sales-taxes.html

[19] http://economix.blogs.nytimes.com/2011/08/22/a-sales-tax-on-wall-street-transactions/

[20] http://www.sec.gov/rules/other/2012/34-66495.pdf

[21] http://www.sec.gov/answers/sec31.htm

[22] http://www.heritage.org/index/ranking

[23] mailto:corrections@alternet.org?Subject=Typo on 5 Facts About How America Is Rigged for a Massive Wealth Transfer to the Rich

[24] http://www.alternet.org/tags/economy-0

[25] http://www.alternet.org/tags/rich

[26] http://www.alternet.org/tags/wealthy

[27] http://www.alternet.org/tags/1-percent-1

[28] http://www.alternet.org/tags/financial-speculation-tax

[29] http://www.alternet.org/%2Bnew_src%2B

http://www.dailykos.com/story/2014/09/26/1332513/--The-most-important-chart-about-the-American-economy-you-ll-see-this-year?detail=email

increasing gap in recovery

I was doing my usual perusal of news and commentary throughout the blogosphere, earlier on Thursday, and I came across this quite stunning chart (see below) from Bard College and Levy Institute economist Pavlina Tcherneva. She’ll be discussing her graphics (republished throughout the blogosphere over the past 36+ hours, along with commentary by folks such as Ryan Cooper, Matt Yglesias, Kevin Drum, Justin Wolfers, and a slew of other well-known economists, bloggers and journalists) in a presentation at the 12th International Post-Keynesian Conference at the University of Missouri at Kansas City (UMKC), Saturday. However, Tcherneva’s work is already trending on Twitter, as you read this.

Here’s Matt Yglesias with his take on the most widely-mentioned of Tcherneva’s graphics--which are based upon statistics from French economist Thomas Piketty’s bestseller, “Capital In The 21st Century”--headlined, “The most important chart about the American economy you'll see this year,” over at Vox.com…

Pavlina Tcherneva's chart showing the distribution of income gains during periods of economic expansion is burning up the economics internet over the past 24 hours and for good reason. The trend it depicts is shocking:

Distribution of Average Income Growth During (U.S. Economic) Expansions (since WWII)

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July 31, 2014 |

Liberals throughout the land breathed a sigh of relief when Senator Sam Brownback of Kansas stepped down in 2008 and later decided to run for governor. Yes, the nation's gain was a loss for the good people of Kansas, but Brownback's special brand of right-wing fundamentalism was so extreme that many felt it was better to try to contain him in a single state rather than inflict him on the whole of the country. Judging from the four years he's been in charge of that unfortunate state, their concerns were well-founded.

This should come as no surprise. His tenure in the Senate was characterized by his righteous absolutism and entirely predictable ultra-conservative vote. There was no tax cut he did not back or military adventure he wasn't in favor of. He voted to impeach President Clinton and even took the unusual step of decrying the immorality of the American public for failing to be properly outraged. But it was in the realm of culture and religion where he made his mark.

Once a devout evangelical Protestant, Brownback converted to Catholicism later in life. (His chief of staff at the time was none other than Congressman Paul Ryan, who is credited with counseling him in his conversion.) In the Senate he took up the banner of the culture war, even chairing a Senate group called the Values Action Team which included such conservative activist groups as Concerned Women for America, Family Research Council, the U.S. Conference of Catholic Bishops, and the National Right to Life Committee, where he and fellow right-wing senators plotted their strategy for taking America back to the Dark Ages. He was so doctrinaire he even refused to vote for a particular judicial candidate because she had once attended a lesbian commitment ceremony. (She didn't officiate or participate; she merely attended.) For the two terms he served in the Senate he was a ferocious culture warrior.

But he wasn't always so intensely focused on the decadence and moral dissipation of modern American life. When he first ran for congress in the mid-'90s he was considered a moderate Kansas Republican like Eisenhower. But a tough campaign against an opponent backed by well-organized right-to-life zealots converted him to an evangelical culture warrior and Republican revolutionary so committed to cutting taxes and shrinking government one profiler said he even gave Newt Gingrich "the willies."

He became leader of a House group called the New Federalists which devoted itself to the dismantling of the government one brick at a time. Fortunately, they were unable to pass their ambitious agenda so they instead became the far-right's hitmen, pioneering the use of hard-core obstructionist tactics to paralyze the government. They were the faction agitating the hardest for a government shutdown in 1995, pushing Gingrich to his most obstreperous limits (and setting the stage for his precipitous fall from grace). Joe Scarborough famously quoted Brownback telling him not to be disillusioned by the PR disaster that ensued, saying "Rome wasn't burnt in a day."

His far-right fiscal bona fides solidly demonstrated, Brownback turned his attention to social issues when he ran for the Senate in 1996 at the height of the religious right's growing clout in the GOP. He spent the next 12 years as a hardcore fiscal conservative but more importantly, as a far-right Christian crusader, sometimes fashioning himself as a "Wilberforce" conservative (after the British anti-slavery activist) comparing abolition of slavery to his determination to ban abortion. He's been closely associated for years with the secretive Christian fellowship group known as the Family.

By the time he tried to run for president in 2008, he appeared to be perfect conservative candidate. Unfortunately, the anticipated groundswell didn't materialize and he dropped out before the primaries. But he did participate in the early debates and was memorably one of the three (with Mike Huckabee and Tom Tancredo) who raised his hand to declare he did not believe in evolution.

Evidently, he really wanted an executive position, so he set his sights on the governor's seat in Kansas and in the Tea Party wave of 2010, won decisively. Brownback's Kansas has turned out to be a perfect petrie dish for every right-wing policy proposal he's championed for the past 20 years. With a Republican legislature and a strong mandate, he quickly established his tenure as the right-wing experiment to end all experiments. The results are in and they are amazing. And not in a good way.

Unlike other Tea Party governors around the nation who have tried out a handful of their more extreme policies, Brownback went for broke. First he and his Koch brother allies (they are Kansas homeboys too, you'll recall) engineered a full-blown Tea Party takeover of the legislature with a well-funded primary strategy in 2012. It is now the most conservative legislature in the nation (and that's saying something considering how conservative Republican legislatures have become). In their minds, they are on a mission from God.

He went after the teachers' union, in one particularly clever move creating what he called "innovation zones" which allow districts to circumvent existing state law regarding curriculum and teacher salaries. He slashed education funding, including cutting the arts programs entirely. He privatized Medicaid. (It goes without saying refused the Medicaid expansion under the ACA.) He defunded Planned Parenthood and signed one of the most far reaching anti-abortion laws in the land, declaring that life begins at "fertilization" and forcing the last remaining Kansas providers to read an anti-abortion script filled with frightening misinformation to women seeking the procedure. (He doesn't even try to hide his religious motives—he wrote the words Jesus + Mary on top of the bill when he signed it.)

Gun legislation has been similarly extreme. Adopting the language of the 10th Amendment fetishists, they managed to pass what they called the Second Amendment Protection Act, a thoroughly useless piece of legislation declaring that the state of Kansas does not have to observe federal gun laws under its "sovereign" status. This last April, Brownback signed the "CLEO Shall Sign and Comprehensive Preemption legislation" which, among other things, prohibits all county and municipal initiative to regulate firearms and ammunition. So much for the vaunted small government, local control portion of the conservative program.

All of this was to be expected from Sam Brownback. But the results of his equally fundamentalist approach to economics has made a lot of people stand up and take notice. First and foremost, he slashed taxes to the bone. Well, not for everyone. The Center on Budget and policy priorities shows how that tax cut has been distributed:

Click to enlarge.

And he cut spending, especially for education, as far as the eye can see:

Click to enlarge.

(Of course, Governor Brownback is a huge proponent of religious home schooling so this is killing two birds with one stone.)

His economic mentor and top adviser, the thoroughly discredited inventor of supply-side economics, Arthur Laffer, explained the game plan back in 2012 this way:

Laffer told more than 200 people at a small-business forum at Johnson County Community College that there is a war among states over tax policy and that nowhere is that revolution more powerful than in Kansas. He said Kansas’ tax cuts and political shifts will produce “enormous prosperity” for the state.

How's that working out? Well, last May this happened:

Moody’s Investors Service dropped Kansas from its second-highest bond rating, Aa1, to its third highest, Aa2. The Kansas Department of Transportation also took the same downgrade.

“The downgrade reflects Kansas’ relatively sluggish recovery compared with its peers, the use of non-recurring measures to balance the budget, revenue reductions resulting from tax cuts which have not been fully offset by recurring spending cuts, and an underfunded retirement system for which the state is not making required contributions,” the report said.

And that's not all. This graph shows what's the matter with Kansas in 2014 in red, white and blue:

Click to enlarge.

As Michael Hiltzik of the LA Times pointed out, if the last few years have shown anything, it's that draconian spending cuts inhibit economic growth while preservation of the services that businesses and workers require to thrive enable it. He cites the example of California where Gov. Jerry Brown successfully raised taxes once the recession was over. As you can see above, California's job growth and prosperity is now leading the nation.

Yes, the citizens of Kansas voted in this right-wing wrecking crew, but it must be remembered that there was a whole lot of help from the deep pockets of native sons Charles and David Koch, who wanted to demonstrate once and for all how well their libertarian economic ideas would work if only they were given a chance. Unlike their counterparts in DC, they didn't have to deal with a Democratic usurper in the Governor's Mansion—they had a true believer leading the way and full rein to see their ideology put to the test.

Their problem now is not because they are seen as the Party of No, or that they are using obstructionist tactics that offend the sensibilities of those who seek a nice bipartisan consensus. These Republicans got everything they wanted. Governor Brownback's approval rating is unsurprisingly in the dirt and he is in grave danger of losing re-election. Another nail in his coffin was pounded in last week when more than 100 current and former Republican officials endorsed Brownback's Democratic opponent, citing the failure of his economic program and the extreme nature of his overall agenda.

Just as other races in the country are reflecting the fight between the GOP establishment and the Tea Party wing, Kansas will be a battleground in the fall for the latest fight for the soul of the Republican Party. But this time it isn't just about race or the culture war or bad political tactics. This one is about all of that to be sure. But this time the Koch brothers' libertarian economic dream agenda has been enacted and it's on the ballot. If America wants to see what the country will look like if the Brownback wing of the GOP manages to get its way nationally, they only need to look at Sam Brownback's Kansas—a disaster on every level.

Heather Digby Parton is a writer also known as Digby. Her political and cultural observations can be found at www.digbysblog.blogspot.com.

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wm robinson ucsb: rise of fascism, inequality // 30's? but instability creates opp for ppl's movement (skep of L/R a la Nader) Talkies 7/26/14

global capitalism and the rise of

http://www.truth-out.org/opinion/item/25141-prof-william-i-robinson-global-capitalism-is-in-the-midst-of-its-most-severe-crisis

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AlterNet [1] / By David Atkins [2]

5 Reasons the Rich Are Ruining the Economy by Hoarding Their Money

June 26, 2014 |

It has been nearly four decades since the Reagan revolution in supply-side economics came to power in the United States. Tax rates on the wealthiest Americans are at near record lows, asset values have been pumped up to record highs, and corporate America is sitting prettier than ever before. There can be no question but that the ideologues who promoted supply-side economics have succeeded in enforcing their vision policy on our lives. But their decades-long experiment has also proven to be structural failure at every possible level (except for padding the pockets of the top 1%.) Here are five things we know without doubt about supply-side economics today:

The money doesn't trickle down.

Of all the failures of supply-side economics, this is the most damning. Conservatives often excuse poor wage growth and high unemployment as part of the global competitive marketplace, saying that everyone needs to tighten their belts. But not everyone is struggling--in fact, the rich are better off than ever. They control half of all the wealth [3], and the top 10% control almost 9/10ths of it [4]. Corporate profits are at or near record highs [5], disproving the myth that the middle class must suffer due to competitive pressures. The Dow Jones index is threatening to burst past 17,000. Meanwhile, wages have stagnated since the Reagan era [6], even though productivity continues to increase [7]. Corporate executives, in other words, are forcing workers to toil longer, harder and smarter than ever, but all the proceeds are going into the hands of the very rich while the people actually creating the wealth are struggling harder than ever to get by. Republicans either wave away this phenomenon as insignificant, or desperately attempt to blame regulation and "crony capitalism." Of course, the last time economic trends were so disproportionately imbalanced against workers was the era before the regulatory and tax increases of the New Deal, nor is there any significant sense (outside perhaps of military contractors favored by the GOP establishment) in which government contracts play a larger role in the economy. Instead, the truth is obvious: corporations don't exist to create jobs but to rake in money, and most rich people didn't get rich by being generous. When you give corporations and the rich more money, they simply hoard it and find ways to make themselves even more money--preferably by employing as few people as possible, at the lowest wages possible.

The rich aren't investing almost half of their resources.

This one is almost comical. In concept, supply-side economics is supposed to work by the corporate rich taking money gleaned by tax breaks and subsidies, and plowing it back into investments that theoretically employ people. Now, we already know that the economic life doesn't actually work that way: when wealthy individuals and companies invest, they tend to do it in financialized vehicles, mergers, acquisitions and interest-bearing accounts while employing the fewest people possible at awful wages.

But even if it did work as supply-siders theorize, the brutal reality is that the rich aren't investing almost half of their money [8] (corporations aren't doing much better, as their record profits sit largely idle [9] avoiding taxation). 40% of the assets of the wealthy are sitting in deposits: the rich person's equivalent of stuffing money into a mattress. Money sitting in deposits in Swiss and Cayman Islands accounts is essentially wasted wealth. It does as little good for the world economy as gold hoarded by a dragon in Middle Earth. It essentially sits there uselessly as an economic security blanket for the very people who need it least. By contrast, putting more money into the hands of the poor and middle class pays off immediately for the economy, as most people living paycheck to paycheck spend the money immediately or at least create a small backstop against bankruptcy and delinquency--thus creating immediate economic and social benefits. So not only does giving the rich more money not pay off when they do invest, it doesn't even have the opportunity to pay off at all since almost half of the money isn't even being invested.

Supply-side economics leads to a bubble economy with bigger and longer recessions.

One of the most dramatic and intentional yet underreported effects of supply-side economics was to convert a stable wage-based economy into an unstable asset-based economy [10]. An economy focused on wage growth and broad prosperity tends to have slower overall growth and is at somewhat greater risk for inflation. It was understandable after the 1970s that some political elites would want to steer far in the other direction. But one of the many downsides to boosting asset growth at all costs is that assets fluctuate in value. Stocks and real estate both tend to rise over the long haul, but in the short term they are subject to bubbles and crashes. And the more money gets thrown into asset markets, the greater is the risk of irrational exuberance, the larger are the bubbles--and the worse are the plunges and panics.

This is extremely problematic at both the individual and macro levels. Individuals whose investments are inadequately diversified and/or who lack enough liquid cash face ruin during downturns. Individuals who lack assets at all find themselves out of work and underpaid when increasingly large recessions slash both wages and jobs. At the broadest level, entire societies bear the burden of asset bubbles when the downturns are so devastating as to threaten the very solvency of the markets themselves. Taxpayers are then forced to shoulder the burden of socializing the market's losses even though its gains are privatized and go almost entirely to the top 1% of incomes. Lastly but not least, inflating housing markets by orders of magnitude within a generation may help those who already own homes to feel richer despite their stagnant wages--but at the severe social cost of making housing largely unaffordable to younger generations [11].

High inequality frays society and reduces trust in institutions.

It is not an accident [12] that trust in major institutions has declined on a linear track with rising inequality. Study [13] after study [14] has shown that trust in our fellow citizens and in institutions at large are dependent on the level of inequality and corruption in society. This stands to reason: people know when they're getting the short end of the stick, even if they can't agree on why. Conservatives wrongly blame government spending and regulation. Liberals rightly blame disproportionate rewards going to the very wealthy. Not surprisingly, then, high levels of inequality also create strong partisanship within society [15] as politicians and pundits alike ratchet up the rhetoric of blame. As both secular and religious institutions seem equally powerless to address increasing economic and social insecurity, the social fabric begins to fray and people tend to self-segregate in many ways, including politically [16]. Economic tension and social tension tend to go hand in hand.

Supply-side economics creates deficits.

Keynesian economists like Paul Krugman will note up front that deficits don't matter nearly as much as most conservative economists claim they do, and that conservatives only seem to care about the deficit when Democrats are in power. Still, insofar as government deficits do matter, it's clear that supply-side economics exacerbates them. Remember that supply-side economics requires tax cuts for the wealthy in order to work. There was a time when conservatives could claim without derision that reducing tax burdens on the rich would lead to so much increased growth that government revenues would actually expand to cover and surpass the upfront tax losses.

That argument has been proven laughably untrue. Government deficits nearly tripled under Ronald Reagan [17]. The tax cuts passed by George W. Bush dramatically increased the budget deficit [18] without even considering increased military and homeland security spending after 9/11. We now know beyond a doubt that whatever the inflection point on the Laffer curve [19] where decreased taxes do lead to greater revenues actually is, it's apparently far higher than the pre-Reagan marginal rates on the wealthy. Liberals often accuse conservatives of intentionally creating large deficits while in power, then using deficit hysteria to "starve the beast" and slash government spending--which in turn damages the economy, reduces consumer demand and slows growth, thus increasing deficits again. Regardless of the merits of that claim, however, we do know for certain today that conservative economics inexorably increases government deficits.

In short, whatever excuses there might have been for voters and policymakers to buy into conservative economic theories in the 1980s, those excuses are now gone.

We know better. We know that supply-side money does not trickle down to workers. We know that corporations and the rich don't even bother to invest a huge portion of their wealth. We know that pumping up assets and investments leads to more unstable economies. We know that supply-side economics is creating larger deficits, and we know that the rampant political corruption and massive inequality caused by supply-side economics is eroding the very fabric of our society.

rich [21]

Source URL: http://www.alternet.org/economy/5-reasons-rich-are-ruining-economy-hoarding-their-money

Links:

[1] http://alternet.org

[2] http://www.alternet.org/authors/david-atkins

[3] http://www.huffingtonpost.com/2013/10/09/richest-1-percent-wealth_n_4072658.html

[4] http://multinationalmonitor.org/mm2003/03may/may03interviewswolff.html

[5] http://thinkprogress.org/economy/2014/03/27/3420092/corporate-profits-record-2013/

[6] http://www.huffingtonpost.com/stan-sorscher/we-all-do-better-when-we-all-do-better_b_1469635.html

[7] http://www.nytimes.com/2013/01/13/sunday-review/americas-productivity-climbs-but-wages-stagnate.html?_r=0

[8] http://business.financialpost.com/2014/06/11/the-worlds-richest-people-are-sitting-on-gigantic-piles-of-cash-that-arent-earning-them-anything/

[9] http://blogs.reuters.com/david-cay-johnston/2012/07/16/idle-corporate-cash-piles-up/

[10] http://www.salon.com/2014/05/04/how_the_rich_stole_our_money_and_made_us_think_they_were_doing_us_a_favor/

[11] http://www.forbes.com/sites/realspin/2013/10/31/millennials-failure-to-launch-is-a-function-of-poor-u-s-housing-policy/

[12] http://opinionator.blogs.nytimes.com/2013/12/21/in-no-one-we-trust/

[13] http://www.gvpt.umd.edu/uslaner/uslanersocialcapitalhandbookelgar.pdf

[14] http://blogs.iq.harvard.edu/sss/attachments/Social.Trust.You.081905.pdf

[15] http://politics.as.nyu.edu/docs/IO/5395/inequality5.pdf

[16] http://www.economist.com/node/11581447

[17] http://thinkprogress.org/politics/2011/02/05/142288/reagan-centennial/

[18] http://www.washingtonpost.com/blogs/wonkblog/wp/2013/01/02/the-legacy-of-the-bush-tax-cuts-in-four-charts/

[19] http://en.wikipedia.org/wiki/Laffer_curve

[20] mailto:corrections@alternet.org?Subject=Typo on 5 Reasons the Rich Are Ruining the Economy by Hoarding Their Money

[21] http://www.alternet.org/tags/rich

[22] http://www.alternet.org/%2Bnew_src%2B

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