I have been rather astonished and disappointed with all of the hullabaloo being made over the record highs achieved with the Dow, as though it were an accurate instrument measuring the financial success and stability of ALL Americans. This continued subscription to “trickle down economics” is part of the dark legacy of Ronald Reagan. This distorted view of economics does hold true…if you are standing in front of a Fun House mirror. Regardless of my own philosophy and my own political convictions, the unbiased truth is that the recent record highs of the Dow only demonstrate the exponentially increasing wealth of the top 10% of Americans.
I admit to having my own very conflicted feelings around money and about capitalism, so I will try to contain all of this article to just facts regarding wealth in the United States. I have to thank my friend Steve Joiner for inspiring me to write this.
First, let us divide the country into five sections of wealth: The Bottom 20%, The Second 20%, The Middle 20%, The Fourth 20%, and finally the top 20%. 92% of all Americans believe the distribution of wealth needs to be more equitable and distributed more fairly. Sadly, this same 92% of Americans’ perception of the actual distribution of wealth is far removed from the reality. The reality is that the bottom 40% of Americans have an infinitesimal portion of the distribution of wealth, while the top 1 % have more than the entire wealth that 9 out of 10 Americans believe the top 20% should have.
I will try to make this a bit more simple and understandable. Let us say the entire country has 100 people total. Of that 100 people, 60% of those people are either destitute, or struggling to make ends meet. Another 20% are doing well financially. The final 20% can be split up as follows: 18% are doing exceedingly well and controlling a great amount of wealth, but then the top 1% control so much wealth that it cannot be pictured on a simple bar graph of wealth due to its disproportionate size. For greater detail and so you can see the actual graphs, click here.
What can be done? We know that 92% of Americans want this inequality to change, so where do we begin? Here I have to thank my friend Bruce Kestelman for inspiring me to address Paul Ryan’s budget redux. Here is where the disparities in wealth have to become political and I have to call out bad behavior. Paul Ryan continues to offer a budget for the United States that only benefits the top 2% of Americans. Yes, he continues to beat the tired old drum of ending Medicare and gutting Medicaid and of course, lowering taxes on the very wealthy. Am I the only one nonplussed here? While claiming to be in alignment with “Catholic Values,” see what Catholics say in response to Ryan. How on earth does Ryan’s budget honor the social contract or social justice in any way? We can change the inequitable distribution of wealth with our votes. We can take power away from Paul Ryan and John Boehner by not voting for them!
I realize today is April Fool’s Day, but I regret to say this is not an April Fools joke. Well, sadly the joke is at the expense of the American people.
Social Justice For All 
Most Americans want a more equitable distribution, until they learn about the policies that will make that come about. Don’t get me wrong, I think the policies we need to do it are good one. We need a more progressive tax code, we need a healthy welfare state (including Single Payer health care) that will keep the wheels of economy going. That first one stymies most Americans though, because, to paraphrase a much better writer than I, most Americans don’t view themselves as poor but as temporarily embarrassed millionaires. They want that regressive tax code for the (mythical) day they get to enjoy our (mythical) meritocracy.
Christine, this is brilliant. I have to steal most Americans don’t “view themselves as poor but as temporarily embarrassed millionaires.” I do hope a good percentage of readers will take the time to click through to the 6 minute video, for it does such a marvelous job of showing the devastating disparities that continue to grow exponentially.
Go ahead and steal it, I already did! 😀
LOL! Thank you, dear.
One change I’d like to see take place? Let’s have technology actually serve its purpose and shorten our workday. If we reduce everyone’s hours, without reducing overall pay, then more people will need to be hired to meet demand. Which means fewer people in poverty, higher demand for products as more people have money to purchase them (and more time to shop for them), and an overall happier and healthier populace. Just sayin’ is all
I am intrigued by this idea, Will. I am wondering how could we adopt something like this in our current (protect the top 20% at all cost) model.
Hi Michael, Thanks for your blog today. I appreciate Christine’s comment about being temporarily embarrassed millionaires, and maybe that is reality for folks in the group that has the next to highest wealth. For folks, certainly in the bottom 40% and even in the bottom 60% the reality is that they are working so hard to make ends meet that it is hard to get involved politically or ask the tough questons. That doesn’t excuse their lack of political engagement, it just helps someone to undertand.
Thanks for passing along the link to the YouTube video. It certainly makes the reality easily understandable and why folks in the top 1% are so focused on keeping what they have (for the most part).
I wonder whether it will be possible to address the disparity in an incremental way, slowly, but surely moving a little closer to the “ideal” expressed in the video over time. Or, will it require almost revolutionary action, where the next civil war will be fought between the wealthy and the poor, with some folks being paid by the wealthy to fight their battles.
Folks like Scott Walker who are not wealthy are doing the bidding of those who are with the expectation of “getting paid” at the end of the road. Scott Walker and president (POTUS) are being used in the same sentence by the media. Some things are just so unrealistic that they might become true.
There are some (probably many) folks who don’t yet get why it is NOT in their own best interest to vote for the Walker’s of the US. Yet they do, thinking that Walker and his ilk will protect their racial, religious, gender, sexual orientation biases and allow them to live in a world where they can be poor, but safe from folks unlike themselves.
Bruce, this was beautifully said! YES, I fear it is far more complicated for the bottom 60% who are working so hard, they may not have the luxury of being fully engaged politically and thus have to trust the system, which is failing us all. Regarding change, I would like to think educating the masses, such as the video tries to do, is the answer, but I fear it may take a revolution. I do worry at the number of folk that support the dominant discourse (Scott Walker, Paul Ryan, and their ilk) and can only surmise that looking at the truth of “regardless of how hard I work, the system is stacked against me” may be too painful. Let us hope this conflict/tension will be the impetus to pave the way for equity.
“Let us hope this conflict/tension will be the impetus to pave the way for equity.”
And if only it could be true.
Bruce, I must believe in bell hooks’ transformative experience. 🙂
Another consideration worth noting is to examine the wealth breakdown within the top 1%. The angle of the graph gets even steeper if you look at the top 10th of that top 1% (which would be one person in a 1000, or approximately 314,000 Americans), and that angle continues to steepen if you look at the top 100th of the top 1%.
Also worth noting is the breakdown of the meager growth we’ve seen in personal income over the past 30 years. The higher you look up the income scale, the greater the proportional share of the total increase in personal income. Which translates into flat or shrinking constant-dollar incomes for 60% of Americans, modest increases for the next 20%, good increases for the top 20%, impressive increases for the top 1%, astonishing increases for top tenth of the top 1%, and absurd and unbelievable increases for the top 100th of the top 1%.
There is no single solution to these troubling trends, but removing distortions in the tax code that specifically benefit the ultra-wealthy (such as on ‘carried interest’), and tacking surcharges on ultra-high incomes and estates would be places to start.
Top earners are, by definition, doing very well financially–what is NOT inevitable is for their share of total income and total wealth to be inexorably (and rapidly!) increasing. Our society has reversed those precise trends in the past (such as during Teddy Roosevelt’s trust-busting era), and in principle it can be done again. What’s uncertain is if the political will can be mustered, which is where blogs such as yours, Michael, make a positive contribution.
Jay,
That was exceedingly well said and I see you felt the full pain I did when I initially watched the video. Parsing out the top 1% does make one physically ill. Yes, I, too, harken back to the days of Teddy Roosevelt and try to cling to some hope. Thank you for your very kind comments and I take solace in knowing there are people like you, Bruce, Steve, and so many others that are working to change this embarrassing disparity.