(Originally published on Pecorino & Eggs on March 1, 2017)
Today, the banks are bigger than ever, 45 million people (or 14.5% of America’s population) live below the poverty line, and the rich only seem to be getting richer.
Tonight’s main story pertains to the world’s unequal distribution of wealth.
In a report published last month, Oxfam, a global response company that investigates economic inequality, reported that 8 men own the same wealth as the poorest half of the world. This means that the net worth of these 8 men is equivalent to more 3.6 billion people. Oxfam determined that the global economy, in order to prevent an all-out collapse, must stop rewarding the top 1% and redistribute the wealth to the middle and lower classes.
But history has shown that we, as Americans, are far from heeding the advice of dozens of prominent economists. The fact that these 8 men own such a majority of the world’s wealth shouldn’t shock us. The trend has been there for us to see for quite some time. In 2010, 388 people were worth more than half the world’s population. In 2015, 62 people were as wealthy as half the world’s population. And now that number is down to 8.
The Economic Policy Institute released a study concluding that between 1973-2008, the bottom 99% of households lost 10.6% of the total share of U.S. household income. During this same period, the annual income of the top 1% of earners rose by roughly 15 percent. And, according to a recent study by economics professors Emmanuel Saez of the University of California-Berkeley and Thomas Piketty of the Paris School of Economics, since 1960, U.S. income inequality has increased more than any other major western country.
Oxfam blamed rising inequality partially on tax dodging. Last year, rich individuals placed a total of $7.6 trillion in offshore accounts, making these funds exempt from income tax. Had these funds been taxed, it would have accounted for an extra $190 billion available to world governments. Mark Goldring, the Oxfam GB chief executive, said, “World leaders’ concern about the escalating inequality crisis has so far not translated into concrete action...In a world where one in nine people go to bed hungry every night, we cannot afford to carry on giving the richest an ever bigger slice of the cake.” But this is America, and our concern for other people beyond our own households is about as tangible as a ghost. We stand idly by as the banks pick our pockets and justify it with trite phrases like, “It’s just the way the world works.”
There are harmful effects that go beyond the devastation of a country’s economy. In surveys conducted between 1968 and 2000, researchers determined countries with unequal distributions of wealth also have higher crime rates. Similar studies found these countries were also unhealthy, as a large number of citizens were unable to afford quality food or pay for their healthcare. This is particularly disturbing as healthcare costs in 2021 are expected to reach $4.8 trillion, up from $75 billion in 1970. And, according to James Levine, professor of endocrinology at the Mayo Clinic, “Americans living in the poorest neighborhoods are more likely to be obese than Americans living above the poverty line.” What’s more is that individuals below the poverty line are twice as likely to die from diabetes.
Studies have also shown an unequal distribution of wealth will lead to political inequalities. Political inequalities occur when Political Action Committees (PACs) or Super PACs allow multi-millionaires and multi-billionaires to donate unlimited amounts of money. The problem with this is, it essentially eliminates the little guy from making an impact. For example, a former teacher of mine donated $30 to Hillary Clinton’s campaign. Unbeknownst to her, this $30 was probably used to help pay for a fraction of the cost of postage in order to mail out more contribution letters asking for money. In contrast to this teacher, in 2016, the corporation Fahr LLC donated $90,639,038 to democrat and liberal PACs, and Las Vegas Sands and Adelson Drug Clinic gave a combined $82,693,930 to conservative and republican PACs. In total, that’s $173,332,968 given by three corporations—$173,332,938 more than my former teacher.
Education is another victim of unequal societies, pitilessly taken out in the back alley and shot and killed by the rich with extreme prejudice. This happens because as the rich become richer, public policies become increasingly favorable to the policy goals of the economic elites; and affordable education for all has never been a high priority with the rich. Education programs tend to be unpopular because they involve taking public funds, which often consist of taxes primarily imposed on the wealthy. They wonder why they should give a fraction of their billions to benefit the poor. Because, asshole, that’s how society stays alive. Now we have a Secretary of Education who wants to implement school vouchersas a means of supplementing education. School vouchers have never, and will never work, but it’s a way for the wealthy to keep millions of more dollars in their pockets as the rest of society fades away like a bad dream. But Betsy Devos’ idiotic policy plans should be left for another day, perhaps when my blood pressure has normalized.
THE BANKS ARE NOT OUR FRIEND
Banks have been out to protect themselves for decades. If only some sort of catastrophe would happen to make the banks realize consolidation of wealth and power is harmful and could lead to a disastrous society and full-on economic downfall. Oh wait. It fucking did. In 2008, the banks collapsed. And the American government took the taxpayers’ money and redistributed it to the wealthy. Not surprisingly, the result of this colossal fuck-up was that the share of total wealth owned by the top 1% grew from 34.6% to 37.1%. Furthermore, the recession and the bailout caused the median household wealth of the top 1% to drop only 11.1%. What happened to the other 99%? Their median household wealth dropped a whopping 36.1%, thus, creating a wider gap between the rich and the poor.
On a global scale, Oxfam said that the wealth of the poorest half of the population dropped by 41% between 2010 and 2015. In the same period, the wealth of the richest 62 people in the world increased by $500 billion to $1.76 trillion.
And, just in case anyone is interested, the top 20 richest Americans hold a net worth of over $1 trillion. $450 billion more than America’s 2016 deficit.
Unequal distribution of wealth is real, and nations have failed when they refused to not only accept it, but act on its harmful consequences. We need serious plans and serious answers, not a government dedicated to placing the blame of our economic troubles on poor people and immigrants.
Make no mistake about it: this unequal distribution is responsible for the systematic execution of lower classes in America, with a heavy burden falling on minorities. How do we fix it? We can take several measures. We can reinstate Glass-Steagall, repeal Citizens United, increase the capital gains tax, reduce income tax for impoverished families, restrict off-shore accounts, forgive student loan debt, keep the ACA, audit the federal reserve, overhaul the SEC, audit the banks. And please, if nothing else, listen more often to Bernie Sanders. I know it sounds like he’s perpetually shouting from the other side of a ballroom, but he knows how to fix the system, and it’s time we take control of our financial futures, and listen.