...that is the conclusion of a new report published by the Next System Project and the Institute for Policy Studies. Their analysis, Common Dreams reports, “makes overwhelmingly clear that despite the Trump administration's self-serving celebrations of the stock market boom and recent monthly job data, the vast majority of Americans remain locked out of America's tremendous wealth.” The report builds on the research of economists Thomas Piketty, Gabriel Zucman, and Emmanuel Saez, who recently found that “the bottom half of the income distribution has been completely shut off from economic growth for the past several decades” as it “highlights the systemic causes of America's vast inequities, including the concentration of political power at the very top, systemic racism, and the dwindling power of organized labor in the face of sustained corporate attacks.”
The report—titled Reversing Inequality: Unleashing the Transformative Potential of an Equitable Economy—notes that due to
….decades of stagnant wages, most low-income workers are now struggling to get by on poverty wages. Nearly half of the workforce is stuck in jobs paying less than $15 an hour. According to Oxfam USA, 43.7 percent of workers—58.3 million people—earn less than $15 an hour, including 53 percent of black workers and 60 percent of Latino workers. Over 41 million of these workers earn under $12 an hour.
The wealthiest Americans, meanwhile, continue to accumulate exorbitant wealth. Common Dreams reports
- "The top one-tenth of 1 percent (an estimated 160,000 households with net worth that starts at $20 million) now own more than 22 percent of all US household wealth in 2012, up from 7 percent in the 1978."
- "This tiny subgroup—the true American elite—now owns as much as the bottom 90 percent of U.S. households combined."
- The combined wealth of the Forbes 400 amounts to around $2.3 trillion. "Together, this small group has more wealth than the bottom 61 percent of the US population combined."
- "The net worth of the wealthiest 20 billionaires—all of whom could sit in one Gulfsteam 650 luxury jet— exceeds that of the bottom half of the U.S. population combined."
The “basic problem,” an article published yesterday in the New York Times concurs, “is that most families used to receive something approaching their fair share of economic growth, and they don’t anymore.”
Only a few decades ago, the middle class and the poor weren’t just receiving healthy raises. Their take-home pay was rising even more rapidly, in percentage terms, than the pay of the rich.
The post-inflation, after-tax raises that were typical for the middle class during the pre-1980 period — about 2 percent a year — translate into rapid gains in living standards. At that rate, a household’s income almost doubles every 34 years. (The economists used 34-year windows to stay consistent with their original chart, which covered 1980 through 2014.)
In recent decades, by contrast, only very affluent families — those in roughly the top 1/40th of the income distribution — have received such large raises.
The report proposes several ways to tackle inequality, including policies that would "lift the floor, level the playing field, break up the over-concentration of wealth, and check unbridled corporate power." Proposals include
- Guaranteeing healthcare to all Americans;
- Making the minimum wage a living wage;
- Ensuring that every worker has "family medical leave, sick leave, and protections against wage theft, racial discrimination, and sexual harassment";
- Making public college tuition-free;
- Enacting reforms that would "limit campaign contributions, ban corporate contributions and influence, and require timely disclosure of all political donations";
- Restoring progressive taxation and eliminating avenues used by the wealthy to avoid paying taxes;
- Breaking up "mega-banks" and vigorously enforcing anti-trust measures.
Chuck Collins, the author of the report and the director of the Program on Inequality at the Institute for Policy Studies, concedes it is “hard to imagine many of these solutions moving forward at the national level in the current political environment," but there are "opportunities to incubate them in states and localities and lay the groundwork for a future political realignment."