Forum Post: 30 Years of Wealth Redistribution
Posted 13 years ago on Nov. 3, 2011, 12:26 p.m. EST by rmmo
(262)
This content is user submitted and not an official statement
What has happened over the last 30 years?
1) Worker wages have stagnated;
2) workers worked more hours and dual incomes to try to make up for stagnate wages;
3) worker benefits decreased -- workers paid more and more of their own healthcare and retirement;
4) highest marginal tax rates dropped from 90% to 36% -- getting rid of disincentive against paying out all corporate profits to the few at the top;
5) worker productivity reached all time high with no wage gains;
6) as worker wages stagnated and productivity increased, corporate profits dramatically increased;
7) larger and larger share of corporate profit pie went to executives at the top;
8) executive salaries ballooned up 275% since 1980;
9) corporations replaced worker wages with easy credit (workers were loaned money to buy products instead of paying them a living wage);
10) workers worked harder than ever and were swimming in debt;
11) corporations and the wealthy pay little in taxes because they use loop holes to evade paying taxes -- the effective tax payments by business and the wealthy are the lowest in 60 years;
12) the loss of unions (now only 6.9% of all private sector jobs are unionized) has led to the loss of employee bargaining power to get the fruits of their labor in wages and benefits;
13) to gain more profit for themselves and shareholders, executives continue to squeeze workers -- laying off workers and making their workers pick of the slack and reducing worker benefits more and more;
14) you need either worker wage increases or more easy credit to get the economy going and workers are already drowning in debt and executives keep all of the profit for themselves -- corporate profits have been at an all time high and executive salaries are at an all time high, but there is no balance of power for the workers get a fair share of the fruits of their labor;
15) our government is corrupted by the wealthy and powerful and we will see years of a main street recession.
Watch this video by an MIT Economics Professor explaining the problem: http://www.youtube.com/watch?v=0HTkEBIoxBA
That pretty well spells it out On point 12, the destruction of organized labor, the favorite and most effective tool has been to outsource jobs to nations that literally kill people who try to protest their slave conditions.
We have been mislead by Reagan, Bush Sr, Clinton, Bush Jr, Obama, and nearly every other public figure. Economic growth, job creation, and actual prosperity are not necessarily a package deal. In fact, the first two are horribly misunderstood. Economic growth/loss (GDP) is little more than a measure of domestic wealth changing hands. A transfer of currency from one party to another. The rate at which it is traded. This was up until mid ’07′ however, has never been a measure of actual prosperity. Neither has job creation. The phrase itself has been thrown around so often, and in such a generic political manner, that it has come to mean nothing. Of course, we need to have certain things done for the benefit of society as a whole. We need farmers, builders, manufacturers, transporters, teachers, cops, firefighters, soldiers, mechanics, sanitation workers, doctors, managers, and visionaries. Their work is vital. I’ll even go out on a limb and say that we need politicians, attorneys, bankers, investors, and entertainers. In order to keep them productive, we must provide reasonable incentives. We need to compensate each by a fair measure for their actual contributions to society. We need to provide a reasonable scale of income opportunity for every independent adult, every provider, and share responsibility for those who have a legitimate need for aid. In order to achieve and sustain this, we must also address the cost of living and the distribution of wealth. Here, we have failed miserably. The majority have already lost their home equity, their financial security, and their relative buying power. The middle class have actually lost much of their ability to make ends meet, re-pay loans, pay taxes, and support their own economy. The lower class have gone nearly bankrupt. In all, its a multi-trillion dollar loss taken over about 30 years. Millions are under the impression that we need to create more jobs simply to provide more opportunity. as if that would solve the problem. It won’t. Not by a longshot. Jobs don’t necessarily create wealth. In fact, they almost never do. For the mostpart, they only transfer wealth from one party to another. A gain here. A loss there. Appreciation in one community. Depreciation in another. In order to create net wealth, you must harvest a new resource or make more efficient use of one. Either way you must have a reliable and ethical system in place to distribute that newly created wealth in order to benefit society as a whole and prevent a lagging downside. The ‘free market’ just doesn’t cut it. Its a farce. Many of the jobs created are nothing but filler. The promises empty. Sure, unemployment reached an all-time low under Bush. GDP reached an all-time high. But those are both shallow and misleading indicators. In order to gauge actual prosperity, you must consider the economy in human terms. As of ’08′ the average American was working more hours than the previous generation with far less equity to show for it. Consumer debt, forclosure, and bankruptcy were also at all-time highs. As of ’08′, every major American city was riddled with depressed communities, neglected neighborhoods, failing infrastructures, lost revenue, and gang activity. All of this has coincided with massive economic growth and job creation. Meanwhile, the rich have been getting richer and richer and richer even after taxes. Our nation’s wealth has been concentrated. Again, this represents a multi-trillion dollar loss taken by the majority. Its an absolute deal breaker. Bottom line: With or without economic growth or job creation, you must have a system in place to prevent too much wealth from being concentrated at the top. Unfortunately, we don’t. Our economy has become nothing but a giant game of Monopoly. The richest one percent of Americans already own nearly 1/2 of all US wealth. An all-time high. More than double their share before Reagan took office. The lower 90 percent of Americans own less than 10 percent of all US wealth. An all-time low. Still, the rich want more. They absolutely will not stop. Now, our society as a whole is in serious jeapordy. Greed kills.
Those of you who agree on these major issues are welcome to summarize this post, copy it, link to it, save it, show a friend, or spread the word in any fashion. I don't care who takes the credit. We are up against a tiny but very powerful minority who have more influence on the masses than any other group in history. They have the means to reach millions at once with outrageous political and commercial propaganda. Those of us who speak the ugly truth must work incredibly hard just to be heard.
According to the Social Security Administration, 50 percent of U.S. workers made less than $26,364 in 2010. In addition, those making less than $200,000, or 99 percent of Americans, saw their earnings fall by $4.5 billion collectively.
The sobering numbers were a far cry from what was going on for the richest one percent of Americans.
The incomes of the top one percent of the wage scale in the U.S. rose in 2010; and their collective wage earnings jumped by $120 billion.
In addition, those earning at least $1 million a year in wages, which is roughly 93,000 Americans, reported payroll income jumped 22 percent from 2009.
Overall, the economy has shed 5.2 million jobs since the start of the Great Recession in 2007. It’s the worst economic downturn since the Great Depression in the 1930’s.
Another word about the first Great Depression. It really was a perfect storm. Caused almost entirely by greed. First, there was unprecedented economic growth. There was a massive building spree. There was a growing sense of optimism and materialism. There was a growing obsession for celebrities. The American people became spoiled, foolish, naive, brainwashed, and love-sick. They were bombarded with ads for one product or service after another. Encouraged to spend all of their money as if it were going out of style. Obscene profits were hoarded at the top. All of this represented a MASSIVE transfer of wealth from poor to rich. Executives, entrepreneurs, developers, celebrities, and share holders. By 1929, America's wealthiest 1 percent had accumulated around 40% of all United States wealth. The upper class held around 30%. The middle and lower classes were left to share the rest. When the majority finally ran low on money to spend, profits declined and the stock market crashed. Of course, the rich threw a fit and started cutting jobs. They would stop at nothing to maintain their disgusting profit margins and ill-gotten obscene levels of wealth as long as possible. The small business owners did what they felt necessary to survive. They cut more jobs. The losses were felt primarily by the little guy. This created a domino effect. The middle class shrunk drastically and the lower class expanded. With less wealth in reserve and active circulation, banks failed by the hundreds. More jobs were cut. Unemployment reached 25% in 1933. The worst year of the Great Depression. Those who were employed had to settle for much lower wages. Millions went cold and hungry. The recovery involved a massive infusion of new currency, a World War, and higher taxes on the rich. With so many men in the service, so many women on the production line, and those higher taxes to help pay for it, the lions share of United States wealth was gradually transfered back to the middle class. This redistribution of wealth continued until the mid seventies. This was the recovery. A massive redistribution of wealth.
Then it began to concentrate all over again. Here we are 35 years later. The richest one percent now own well over 40 percent of all US wealth. The lower 90 percent own less than 10 percent of all US wealth. This is true even after taxes, welfare, financial aid, and charity. It is the underlying cause. No redistribution. No recovery.
The government won't step in and do what's necessary. Not this time. It's up to us. Support small business more and big business less. Support the little guy more and the big guy less. It's tricky but not impossible.
No redistribution. No recovery.
People are going to have to adopt a new philosophy and way of life, just like the green movement. That started way back with "Silent Spring" in the early 1960s. It took a long time to get people to adopt something as plain and simple as recycling. The green revolution is still ongoing. What OWS has started will take decades.