It is true that there has been a great redistribution of wealth going on. As a matter of fact, it's been underway for the past 30 years. But the direction of the wealth's movement has not been downward toward the undeserving poor as so many seem to fear. No, the movement has been upward to the most well-to-do, and the shift has been massive. And, we see the results every day, as increasing numbers of people come our way seeking assistance.
Eugene Robinson explains in the following report:
The study that shows why Occupy Wall Street struck a nerve
The hard-right conservatives who dominate the Republican Party claim to despise the redistribution of wealth, but secretly they love it — as long as the process involves depriving the poor and middle class to benefit the rich, not the other way around.
That is precisely what has been happening, as a jaw-dropping new report by the nonpartisan Congressional Budget Office demonstrates. Three decades of trickle-down economic theory, see-no-evil deregulation and tax-cutting fervor have led to massive redistribution. Another word for what’s been happening might be theft.
The gist of the CBO study, titled “Trends in the Distribution of Household Income Between 1979 and 2007,” is that while we’ve become wealthier overall, these new riches have largely bypassed many Americans and instead flowed mostly to the affluent. Perhaps my memory is faulty, but I don’t remember voting to turn the United States into a nation starkly divided between haves and have-nots. Yet that’s where we’ve been led.
Overall, in inflation-adjusted dollars, average after-tax household income grew by 62 percent during the period under study, according to the CBO. This sounds great — but only until you look a little closer.
For those at the bottom — the one-fifth of households with the lowest incomes — the increase was just 18 percent. For the middle three-fifths, the average increase was 40 percent. Spread over nearly 30 years, these gains are modest, not meteoric.
By contrast, look at the top 1 percent of earners. Their after-tax household income increased by an astonishing 275 percent. For those keeping track, this means it nearly quadrupled. Nice work, if you can get it.
This is not what Republicans want you to think of when you hear the word redistribution.
Overall, in inflation-adjusted dollars, average after-tax household income grew by 62 percent during the period under study, according to the CBO. This sounds great — but only until you look a little closer.
For those at the bottom — the one-fifth of households with the lowest incomes — the increase was just 18 percent. For the middle three-fifths, the average increase was 40 percent. Spread over nearly 30 years, these gains are modest, not meteoric.
By contrast, look at the top 1 percent of earners. Their after-tax household income increased by an astonishing 275 percent. For those keeping track, this means it nearly quadrupled. Nice work, if you can get it.
This is not what Republicans want you to think of when you hear the word redistribution.
Reactions welcomed, as always.
This ties in nicely with this article from one of America's great thinkers:
ReplyDeleteBill Moyers: 'How Wall Street Occupied America': http://t.co/bXx2FzjC
Ken
Dallas
The top 1 percent paid nearly 40 percent of the taxes.
ReplyDeletePerhaps the occupiers should occupy the libraries and schools more so they wouldn't have to flip burgers for a living.
When asked why he robbed banks, Willie Sutton (allegedly) responded "because that's where the money is." Given the enormous curve on the graph indicating the wealthiest 1 percent have so much of the money, it makes perfect sense to me that's where most of the money comes from in taxes. And I'm pretty sure they don't even miss it. No less than Warren Buffet says as much.
ReplyDeleteKen
Dallas
So importing over 100 million unskilled immigrants since 1965 has increased inequality? I am shocked, absolutely shocked; it goes against everything I've been taught at university: low skill immigrants reduce inequality and enrich the culture because diversity is strength and pc censorship is freedom.
ReplyDeleteMy worldview is shattered.
One of my colleagues posted this to his blog:
ReplyDeleteThis is a message board exercise students in Principles of Microeconomics have to do this weekend. They will have read Chapter 7 of Good Intentions entitled "How Did Ben & Jerry Get So Rich?"
This chapter deals with CEO compensation. Many people are outraged that CEOs earn so much more than the average worker. You have likely seen the news coverage of Occupy Wall Street and similar groups protesting this, among other things.
In 2005, the median annual salary for a CEO of a Fortune 500 company (the largest 500 companies in the U.S.) was $6.7 million. The median salary of a factory worker was $29,544. Some people think this is unfair.
Tom Brady, quarterback of the New England Patriots earned $18 million in 2010, while his current wife also earns somewhere around $15 million as a model. Peyton Manning's contract was set to pay him about $23 million this year to QB the Colts (and will still pay him most of that even though he hasn't played a single game due to an injury).
1. Chapter 4 of Good Intentions discussed how workers are paid according to their productivity-- classical labor theory says workers should be paid according to the marginal product of their labor--about as much as they add value to the overall economy. Do you think the median Fortune 500 CEO is 227 times more productive than the median factory worker? Is Tom Brady 609 times more productive? Is Peton Manning 778 times more productive?
2. Why do you think the media and politicians focus on salary and bonsuses for CEOs and not athletes?
3. The NFL is a government-granted monopoly, it is exempt from antitrust legislation. Most CEOs and factory workers work for companies competing globally. How do you think this affects the salaries above?