The upward redistribution of income in the U.S. is undermining the nation’s Social Security:
if you’re a millionaire, February 16th is the last day that you will pay into the social security for the entire year. That’s because the Federal payroll tax cap is set at $127,000, so any money made beyond this point, is not subject to taxation that would fund this very crucial Federal social program.
See Real News Network interview with Dean Baker of the Center for Economic Policy Research here.
Inequality by the numbers:
Source: “Economic growth in the United States: A tale of two countries,” by Thomas Piketty, Emmanuel Saez and Gabriel Zucman for the Washington Center for Equitable Growth.
Portland, Oregon, has instituted a first-ever tax on corporations that pay their CEOs more than 100 times as much as their workers. Econ4’s Doug Smith told the Portland City Council:
“Instead of building a real economy beneficial to all, these unethical pay practices spread outsourcing, offshoring, tax avoidance, downsizing and the substitution of good-paying permanent jobs with temporary, precarious employment.”
Read about it here.
Econ4’s Jim Boyce and Peter Barnes, author of With Liberty and Dividends for All, break down how universal basic income could be funded by common wealth:
The wealth we inherit and create together is worth trillions of dollars, yet we presently derive almost no income from it. Our joint inheritance includes invaluable gifts of nature such as our atmosphere, minerals and fresh water, and socially created assets such as our legal and financial infrastructure, without which private corporations couldn’t exist, much less thrive. If our common assets were better managed, they could pay every American, including children, several hundred dollars a month.
Read their piece here.
Nobel laureate Joe Stiglitz writes:
Where the trade agreements failed, it was not because the US was outsmarted by its trading partners; it was because the US trade agenda was shaped by corporate interests….
We need to rewrite the rules of the economy once again, this time to ensure that ordinary citizens benefit. Politicians in the US and elsewhere who ignore this lesson will be held accountable. Change entails risk. But the Trump phenomenon – and more than a few similar political developments in Europe – has revealed the far greater risks entailed by failing to heed this message: societies divided, democracies undermined, and economies weakened.
Read more here.
Nancy Folbre takes issue with Harvard professor Gregory Mankiw’s defense of the one percent:
The rich are not like you and me. They contribute far more to society than everybody else, so argues Harvard University economist Gregory Mankiw in his essay “Defending the One Percent.” Mankiw’s praise for talented superstars such as Steven Jobs, J.K. Rowling, and Steven Spielberg quickly blooms into a more general argument that competitive labor markets pay workers what they deserve. This is music to the ears of high earners, and it sings to a very human desire to believe that the world is fair….
Some of us contribute more than members of the top one percent to the economy, and some of us contribute less. None of us gets exactly what we deserve. One difference between the rich and us is that they have more money. They also enjoy—both as cause and effect—a lot more power.
Bill Moyers on the need for a level playing field and real democracy:
In May, President Obama and I both spoke at the Rutgers University commencement ceremony. He was at his inspirational best as 50,000 people leaned into every word. He lifted the hearts of those young men and women heading out into our troubled world, but I cringed when he said, “Contrary to what we hear sometimes from both the left as well as the right, the system isn’t as rigged as you think…”
Wrong, Mr. President, just plain wrong. The people are way ahead of you on this. In a recent poll, 71% of Americans across lines of ethnicity, class, age, and gender said they believe the U.S. economy is rigged. People reported that they are working harder for financial security. One quarter of the respondents had not taken a vacation in more than five years. Seventy-one percent said that they are afraid of unexpected medical bills; 53% feared not being able to make a mortgage payment; and, among renters, 60% worried that they might not make the monthly rent.
Millions of Americans, in other words, are living on the edge. Yet the country has not confronted the question of how we will continue to prosper without a workforce that can pay for its goods and services….
The religion of inequality — of money and power — has failed us; its gods are false gods. There is something more essential — more profound — in the American experience than the hyena’s appetite. Once we recognize and nurture this, once we honor it, we can reboot democracy and get on with the work of liberating the country we carry in our hearts.
Read his powerful essay, “We, the Plutocrats vs. We, the People,” here.
A new interactive website from the Economic Policy Institute compares the one percent and everyone else in the U.S. – by state and by county:
Check out the numbers for your state here.
A long history of elite disconnection from the economic realities faced by most Americans helped to set the stage for the nation’s current political turmoil:
For some time now most of the people in this country have been under economic pressure. Pay is not going up very much or at all, while living costs keep rising. One recent statistic stands out – 63 percent of Americans would have difficulty raising $500 to cover an emergency, like a sudden need for car repair so they can get to work. Around them the community’s roads and schools and services are in decline.
Most of the public can see this clearly, yet so many elites can’t see at all, and see it or not, they do little or nothing to make things better. This arrogance of our blind, well-fixed elites is helping drive the Donald Trump phenomenon.
Read more here.
Peter Barnes explains how protecting the environment and sharing the fruits of our economy more broadly can – and should – go hand-in-hand:
The failure to charge for common wealth — for example, letting polluters dump freely into our atmosphere — leads to what economists call “negative externalities.” The costs of pollution aren’t paid by polluters; they are shifted to pollutees, nature and future generations. And this market failure persists because no living individuals or companies would financially benefit from fixing it.But imagine a system in which everyone benefits from fixing this tragic flaw. In this system, polluters would pay and all living citizens, as joint beneficiaries and trustees of nature’s gifts, would get dividends. The higher the price for using the commons, the larger the dividends and the lower the externalities. The health of nature’s gifts would be directly linked to greater income for everyone.
Read more here.