Things Could Be Worse
Reading time – 2:13; Viewing time – 4:15 . . .
In a most accessible article in the November 10, 2014 Christian Science Monitor, author Henry Gass reviewed a fresh examination of wealth inequality, comparing 1929 America to today. Here are selections of Gass’ writing:
In the late 1920s, the top 10 percent of Americans possessed 84 percent of the country’s wealth. Since then, wealth inequality in America has followed a U-shaped trajectory, declining through the Great Depression until the mid-1980s, then steadily increasing since then.
Professors Saez and Zucman found that the richest 0.1 percent of Americans [today] have as much of the country’s wealth as the poorest 90 percent. Both groups control roughly 22 percent of total wealth . . .
While the bottom 90 percent of Americans and the top 0.1 percent control about 22 percent of the country’s wealth each, the top 0.01 percent of Americans now control 11.2 percent of total wealth. That share of the wealth held by the country’s richest 0.01 percent . . . is the largest share they’ve had since 1916, the highest on record, according to the study.
Wait a second: the study’s authors said that, ” . . . wealth inequality in America has followed a U-shaped trajectory, declining through the Great Depression until the mid-1980s, then steadily increasing since then.” What do you suppose happened in the 1980s to cause that shift? Could it be trickle-down economics that really only trickles up? Could it also have something to do with blind faith in unregulated free markets, with Adam Smith’s invisible hand blessing only the already wealthy?
Perhaps it’s pleasant to have so much power that one can influence laws and regulations in order to continually expand one’s power and wealth. On the other hand, this is exactly why the Founders abhorred monopoly (it had been forced on them by the Crown) and it is why we passed the Sherman Anti-Trust Act in 1890. “Trust” was what monopolies were called then, and the last time that law was invoked was in 2000 in a case involving Microsoft and its bundling of apps that unfairly restricted competition (Read: put other companies out of business, kept prices unnaturally high and Americans lost jobs). The time it was invoked before that was before Reagan was elected. He refused to use the Act and that hands-off approach and absolute faith in “the market” has led to the enormous roll up of companies in industry after industry, with the result that competition is severely limited and, prices escalate and wealth continues to concentrate in the hands of a very few Americans.
For example, we used to have seven major air carriers in the U.S. Due to mergers, we now have only three. American Airlines just completed the purchase of US Air, claiming that doing so would have no adverse effect on competition. But it is reported that they will be devaluing their Frequent Flyer program in the second half of 2016. And, in a January 29, 2016 conference call, American Airlines CEO Doug Parker explained how American will be increasing revenues by charging more for things like room for your knees and things that they haven’t charged for before. That is to say, now that they own a former competitor, prices are going up.
That’s just one small example of how the rich get richer and the poor get poorer in today’s rigged economy.
Given enough economic jabs, people will become angry, and that Chinese water torture of wealth inequality expansion could lead to something ugly. It certainly has given us a crazy election season, the essence of which was captured by one South Carolina supporter of Donald Trump, who explained, “We’re voting with our middle fingers.”
Things could be worse. Unfortunately, we keep proving that to be true.
————————————-
Ed. note: There is much in America that needs fixing and we are on a path to continually fail to make things better. It is my goal to make a difference – perhaps to be a catalyst for things to get better. That is the reason for these posts. To accomplish the goal requires reaching many thousands of people and a robust dialogue.
ACTION STEP: Please offer your comments below and pass this along to three people, encouraging them to subscribe. Thanks! JA
Copyright 2024 by Jack Altschuler
Reproduction and sharing are encouraged, providing proper attribution is given.
