Buried under all the noise of the national circus over the last month was some fairly stark economic news. Despite all the hoopla about the stock market booming along and other financial happy talk, it appears the iceberg of economic inequality is becoming an even larger threat to our collective ship.
Late last December we learned that the world’s wealthiest people got a whole lot richer in 2017. As the Washington Post reported, “The richest people on earth became $1 trillion richer in 2017, more than four times last year’s gain, as stock markets shrugged off economic, social and political divisions to reach record highs.”
Of course, this has only helped exacerbate America’s historic level of economic inequality. As The Hill recently noted:
The wealthiest 1 percent of Americans now own 40 percent of the country’s wealth, the highest share in the last 50 years, according to a new study. . . . [T]he gap between the wealth owned by the top 1 percent and the wealth owned by the bottom 90 percent has been steadily widening over the past few decades as the wealthiest become wealthier and the majority of households lose their share.
The average net worth of households in the top 1 percent is $26.4 million. The top 20 percent of households own 90 percent of the country’s wealth, and the bottom half of the top 20 percent have an average net worth of $740,800, according to Woolf. The wealth inequality gap in worse in the US than in any country around the world.
And rather than designing policy to address this issue, the current administration and Congress have rushed us headlong in the wrong direction with the new tax plan that, as the Post notes, redistributes wealth from the rest of us to the rich while increasing the burden on the poor. Thus, despite the booming stock market, the underlying economic news about structural inequality in the economy continues to get worse.
On that note, just after the new year, the Post again reported on yet another recent study that reveals that even Thomas Piketty’s dire predictions might have underestimated how bad our “endless inegalitarian spiral” has become:
In his best-selling 2014 book “Capital in the Twenty-First Century,” French economist Thomas Piketty warned that if the already rich were able to accumulate wealth faster than economies were able to grow, inequality would skyrocket in the coming decades, potentially destabilizing societies in the process . . Now a working paper, written by Federal Reserve Bank of San Francisco economist Òscar Jordà and others, purports to calculate just that: “The Rate of Return on Everything.” After compiling this first-of-its-kind data set, Jordà’s team makes a startling conclusion: If anything, Piketty’s book underestimates the historical rate of return on wealth. “The same fact reported [by Piketty] holds true for more countries and more years, and more dramatically,” the researchers conclude . . . The implication is that Piketty may have been correct after all with his dire prediction of accelerating inequality in the decades to come, perhaps even more correct than he realized.
So, as we push forward in our resistance to Trump, it’s important to remember that as important as rejecting this President is, any answer to the Social Darwinist nightmare his reign has wrought has to say no not just to Trump but to the real power behind him–the unchecked clout of the economic elite. As Bernie Sanders writes in a recent Guardian piece:
Now, more than ever, those of us who believe in democracy and progressive government must bring low-income and working people all over the world together behind an agenda that reflects their needs. Instead of hate and divisiveness, we must offer a message of hope and solidarity. We must develop an international movement that takes on the greed and ideology of the billionaire class and leads us to a world of economic, social and environmental justice.
Sanders is right and any politics of “resistance” that fails to address this task is doomed to failure.