Distribution of Wealth : Way Out of Whack

Image from OECD / CBS News.
Trickle UP theory:
The recession and its roots

By Ted McLaughlin / The Rag Blog / July 15, 2010

Have you ever wondered just what caused the deep recession that the United States is in? Many people believe it was the meltdown of Wall Street and the financial industry. That was the trigger that began the recession, but was it the true cause of it? Robert Reich has a very good article in The Nation that the folks over at Alternet have reprinted.

Reich agrees that the Wall Street meltdown was the trigger to the recession, just as the Wall Street disaster in 1929 triggered the Great Depression. But the real cause of both the current recession and the Great Depression was the absurdly lopsided distribution of income. In 1928 the income distribution had reached a point where the top 1% of the population was making 23.9% of all income in the United States. With only 76.1% of the country's income left for 99% of the country's people, the situation created was like a loaded gun waiting for something to pull the trigger (and that trigger was pulled with the Wall Street crash of 1929).

Conservatives don't like to admit it, but a capitalist economy such as ours simply cannot function correctly when such a large proportion of the country's income is going to such a small percentage of it's people. The country did not pull out of that depression until the income was redistributed in a more equitable way. This was accomplished by the New Deal programs putting people to work, World War II (which employed even more people), the GI Bill (which educated many soldiers, qualifying them for higher-paying jobs), the Great Society, which decreased the number of people in poverty, and higher income taxes.

By the 1970's the income percentage of the top 1% had been reduced to around 7% or 8% of the nation's total income -- a much more manageable figure. But the Great Depression had taught the Republican Party nothing it seems. In 1980, Ronald Reagan became president and began the process of again redistributing the income toward the top 1%.

The Republicans did this with a really good propaganda campaign which convinced many Americans that a "trickle down" theory of economics would work. This was the idea that if we just let the rich make more and more money, then they would share it with the rest of us -- in other words, it would trickle down and benefit all Americans. Sadly, all it did was fatten the bank accounts of the rich.

The Republicans redistributed the country's income by busting unions, deregulating the stock market and the financial industry, severely cutting social programs, deregulating college tuitions (which priced college out of the budgets of many Americans), and by repeatedly and radically cutting taxes for the richest Americans. By 2007, the top 1% of Americans was again controlling 23.5% of this country's total income.

Once again the country's economic gun was loaded and cocked. The trigger was pulled by the meltdown of the financial industry. Reich says the reason this has not caused another depression was the bailout of the financial industry with the TARP funds. I'm not so sure we have yet escaped that. The bailout saved the financial giants and the rich, but many smaller banks have gone under (and it's still happening), and all but the rich are still mired in a deep depression because of the loss of 12 to 15 million jobs. We may still see a deeper recession (depression?) because the jobs situation has not been adequately addressed and the income distribution is still way out of line.

So what can be done to cure the current recession? Further deregulation or tax cuts will not help. That would only exacerbate the situation and make the income distribution problem even worse (which was the cause of this mess in the first place). The problem must be attacked on a broad front by government targeted at re-distributing the country's income. Conservative's hate the term "income redistribution," but they have been doing just that for the last 30 years. The problem is they have been redistributing the income away from the people who need it and toward the richest among us. This process must be reversed.

The government must spend a lot more money on job creation. Much of this can be directed at the private sector through the building and revamping of our transportation infrastructure (bridges, streets and highways, mass transit, trains, etc.). They could also create government programs to clean up and improve our National Parks, wetlands, monuments, and other things along the lines of the New Deal's WPA and CCC.

Another thing needed is a massive influx of money into low-cost and easy-to-pay-back loans for small businesses (since small businesses provide the bulk of jobs in this country). These small businessmen and -women are hurting too, and they are certainly not among that richest 1% of Americans. Although the government bailed out the financial giants, these financial giants have not repaid Americans by making loans available to small businesses as they should have. They have instead used that money to speculate in the stock market and give themselves enormous bonuses.

A couple of other things that could be done: strengthen worker unions and have the government provide a much larger portion of the money needed for a college education. Strengthening unions would insure workers' wages and benefits and guarantee that those workers receive their fair share of increased production. Paying a much higher portion of the cost of a college education would once again let all Americans take advantage of educational opportunities to create a better and higher-paying future for themselves.

Finally, income taxes should be raised significantly on the richest Americans -- especially that top 1%. I know the right-wingers will whine that this would hurt job creation. That is false. High taxation does not cause job losses and low taxation does not create jobs. Businesses will hire only the number of workers needed to appropriately deliver their goods or services to their customers -- regardless of what the tax rate is.

In fact, there is a good argument to be made that our country prospers the most when the rich are highly taxed (as they were during the boom times of the 1950s). For one thing, it helps to distribute the country's income more evenly and fairly. It also encourages business interests to re-invest their excess income back into their business to save on the taxes they would owe, thus creating new jobs and helping the economy (and creating even more income for the business).

The right wing will scream that much of what I have proposed will increase our already large deficit. That is true. But it must be done if we are to stave off an even deeper recession and eventually pay off that deficit. As the income is redistributed and jobs are created there will be an ever increasing number of people paying taxes. The higher taxes on the rich and the increasing number of tax-paying workers will pay down the deficit as these proposals begin to take effect.

The deficit is important, but just trying to reduce it without creating jobs and redistributing income will not bring the country out of the recession. It will only make it worse. Job creation and income redistribution are much more important -- not only to bring the country out of recession but also to prevent another even worse recession.

[Rag Blog contributor Ted McLaughlin also posts at jobsanger.]

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Poor Grow Poorer : Richest 1% Has Captured America's Wealth

The ultra rich have captured America;
How can we take it back?

By David DeGraw / February 19, 2010

"The war against working people should be understood to be a real war... Specifically in the U.S., which happens to have a highly class-conscious business class... And they have long seen themselves as fighting a bitter class war, except they don't want anybody else to know about it." -- Noam Chomsky

As a record amount of U.S. citizens are struggling to get by, many of the largest corporations are experiencing record-breaking profits, and CEOs are receiving record-breaking bonuses. How could this be happening, how did we get to this point?

The Economic Elite have escalated their attack on U.S. workers over the past few years; however, this attack began to build intensity in the 1970s. In 1970, CEOs made $25 for every $1 the average worker made. Due to technological advancements, production and profit levels exploded from 1970-2000. With the lion's share of increased profits going to the CEO's, this pay ratio dramatically rose to $90 for CEOs to $1 for the average worker.

As ridiculous as that seems, an in-depth study in 2004 on the explosion of CEO pay revealed that, including stock options and other benefits, CEO pay is more accurately $500 to $1.

Paul Buchheit, from DePaul University, revealed, "From 1980 to 2006 the richest 1% of America tripled their after-tax percentage of our nation's total income, while the bottom 90% have seen their share drop over 20%." Robert Freeman added, "Between 2002 and 2006, it was even worse: an astounding three-quarters of all the economy's growth was captured by the top 1%."

Due to this, the United States already had the highest inequality of wealth in the industrialized world prior to the financial crisis. Since the crisis, which has hit the average worker much harder than CEOs, the gap between the top one percent and the remaining 99% of the U.S. population has grown to a record high. The economic top one percent of the population now owns over 70% of all financial assets, an all time record.

As mentioned before, just look at the first full year of the crisis when workers lost an average of 25 percent off their 401k. During the same time period, the wealth of the 400 richest Americans increased by $30 billion, bringing their total combined wealth to $1.57 trillion, which is more than the combined net worth of 50% of the US population. Just to make this point clear, 400 people have more wealth than 155 million people combined.

Meanwhile, 2009 was a record-breaking year for Wall Street bonuses, as firms issued $150 billion to their executives. 100% of these bonuses are a direct result of our tax dollars, so if we used this money to create jobs, instead of giving them to a handful of top executives, we could have paid an annual salary of $30,000 to 5 million people.

So while U.S. workers are now working more hours and have become dramatically more productive and profitable, our pay is actually declining and all the dramatic increases in wealth are going straight into the pockets of the Economic Elite.

If our income had kept pace with compensation distribution rates established in the early 1970s, we would all be making at least three times as much as we are currently making. How different would your life be if you were making $120,000 a year, instead of $40,000?

So it should come as no surprise to see that we now have the highest inequality of wealth in the industrialized world and the highest inequality of wealth in our nation's history. The backbone of America, a hard working middle class that has made our country a world leader, has been devastated.

Now that we have a better understanding of how our income has been suppressed over the past 40 years, let's take a look at how the economy has been designed to take the limited money we receive and put it into the hands of the Economic Elite as well.

Cartoon from links.org.

Costs of living

Other than in the workplace, in almost all our costs of living the system is now blatantly rigged against us. Let's take a look at it, starting out with our tax system.

In total, the average U.S. citizen is forced to give up approximately 30% of our income in taxes. This tax system is now strategically designed to flow straight into the hands of the Economic Elite. A huge percentage of our tax dollars ultimately end up in their pockets. The past decade proves that -- whether it's the Republicans or the Democrats running the government -- our tax money is not going into our community, it is going into the pockets of the billionaires who have bought off both parties -- it is obscene.

For an example of how this system flows to the Economic Elite, just look at the Wall Street "bailout." The real size of the bailout is estimated to be $14 trillion -- and could end up costing trillions more than that. By now you are probably also sick of hearing about the bailout, but stop and think about this for a moment. Do you comprehend how much $14 trillion is?

What could be accomplished with this money is almost beyond common comprehension.

And this is just the tip of the iceberg that has hit us. On top of the trillions given to the Wall Street elite, we already have a record $12.3 trillion in national debt -- and we now have to pay $500 billion in interest to the Economic Elite on this debt every year, yet another way they are milking us dry. When you add in unfunded liabilities owed, like social security payments, we actually owe a stunning $74 trillion. That adds up to a debt of $242,000 for every man, woman and child in America.

Trillions more, 25% of taxpayer dollars allocated to military spending, goes unaccounted for every year, not to mention the billions spent on overcharging and outright fraud. During the War on Terror, the Economic Elite have used our tax money to build a private army that has more soldiers deployed than the U.S. military -- a congressional study revealed that 69% of the "U.S." fighting forces deployed throughout the world in our name are in fact private mercenaries, 80% of them are foreign nationals.

Private contractors regularly get paid three to five times more than our soldiers, and have been repeatedly caught overcharging and committing fraud on a massive scale. A congressional investigation revealed this and strongly recommended that we seize wasting tax dollars on these private military contractors. However, under Obama, there has actually been a drastic increase in total tax dollars spent on them.

In 2009, just over $1 trillion tax dollars were spent on the military, it's safe to say that at least $350 billion of that was needlessly wasted.

When you research our tax system you see an unprecedented level of waste and fraud rampant throughout most expenditures. Our tax system is a national disaster of epic proportions. It is literally an organized criminal operation that continues to rob us in broad daylight, with zero accountability.

Politicians and mainstream "news" outlets will not tell you this, but most every serious economist knows that due to so much theft and debt created in the tax system, the only way to fix things, other than stopping the theft and seizing the trillions that have been stolen, will be for the government to cut important social funding and drastically raise our taxes.

Other than the record national debt, many states are running record deficits and are barreling toward economic disaster, raising the likelihood of higher taxes, more government layoffs and deep cuts in services. Our nation's biggest state economies, like California and New York, are the ones in most trouble.

To merely say that things will not be improving economically is to be a delusional optimist. The truth that you will not hear: we have been hit by an economic deathblow and the United States lay in ruins.

It's not just this criminal tax system; the theft is now built into all our costs of living.

Trillions more in our spending on food and fuel has been stolen due to fraudulent stock transactions and overcharging. Just 10 years ago, in 2000, American families paid 7% of our income on food and fuel. We now pay 20%.

This drastic increase is primarily driven by fraudulent market manipulation that drives up stock prices. Congress uncovered this in 2006; as part of the Enron investigation they found that companies manipulated the oil market to create major spikes in stock values, and then they didn't do anything about it -- nothing to see here, just move on.

As mentioned before, we have the most expensive health care system in the world and we are forced to pay twice as much as other countries, and the overall care we get in return ranks 37th in the world. On average, U.S. citizens are now paying a record high 8% of their income on medical care.

Part of the reason why foreclosure rates are so high is because the percentage of income Americans pay on their housing has risen to 34%.

So for these basic necessities -- taxes, food, fuel, shelter and medical bills -- we have already lost 92% of our limited income. Then factor in ever-increasing interest rates on credit cards, student loans, rising prices for cable, internet, phone, bank fees, etc., etc., etc. We are being robbed and gouged in all costs of living, in every aspect of our life. No wonder bankruptcies are skyrocketing and the number of people suffering from psychological depression has reached an epidemic level.

The American worker is screwed over every step of the way, and it all starts with the explosion in the cost of a college education. This is one of the Economic Elite's most devastating weapons. To have any chance of succeeding in this economy, it is commonly believed that you must attend the best college possible. With the rising costs involved, today's students are graduating with record levels of debt from student loans.

At the same time, the unemployment rate among recent college graduates has risen higher than the national average, and those that do find work are making significantly less than they expected to make. This combination of extreme debt and reduced pay has crippled an entire generation right from the start and has put them in a vicious cycle of spiraling debt that they will struggle with for the rest of their lives. The most recent college graduates are now known as a "lost generation."

The American dream has turned into a nightmare. The economic system is a sophisticated prison cell; the indentured servant is now an indebted wage slave; whips and chains have evolved into debts.

"There are two ways to conquer and enslave a nation. One is by sword. The other is by debt." -- John Adams

Concealing national wealth

"Liberty in the concrete signifies release from the impact of particular oppressive forces; emancipation from something once taken as a normal part of human life but now experienced as bondage... Today, it signifies liberation from material insecurity and from the coercions and repressions that prevent multitudes from participation in the vast cultural resources that are at hand." -- John Dewey

When you take the time to research and analyze the wealth that has gone to the economic top one percent, you begin to realize just how much we have been robbed. Trillions upon trillions of dollars that could make the lives of all hard working Americans much easier have been strategically funneled into the coffers of the Economic Elite. The denial of wealth is the key to the Economic Elite's power. An entire generation of massive wealth creation has been strategically withheld from 99% of the U.S. population.

The U.S. public doesn't have any understanding of how much wealth has been generated and concentrated into the hands of the Economic Elite over the past 40 years; there is no historical frame of reference. This withholding of wealth is truly the greatest crime against humanity in the history of civilization.

What could be done with all the money that has been hoarded by the Economic Elite is extraordinary!

Let's consider what we could do with the money that has been stolen from us? On top of what should be our average six-figure yearly income, we could have:

• Free health care for every American,
• A free 4 bedroom home for every American family,
• 5% tax rate for 99% of Americans,
• Drastically improved public education and free college for all,
• Significantly improved public transportation and infrastructure,

The list goes on...

This is not some far-fetched fantasy. These are all things that Franklin D. Roosevelt talked about doing in the 1940's, long before the explosion of wealth creation in our technologically advanced global economy. The money for all this is already there, stashed into the claws of the Economic Elite.

The denial of wealth to the masses is the key to the Economic Elite's power. Outside of outdated and obsolete economic models and theories -- and incredibly short-sighted greed -- there is no reason why all this money should be kept in the hands of a few, at the immense suffering and expense of the many.

If Americans could just understand how much wealth is being withheld from us, we would have a massive uprising and the Economic Elite would be swept away, into the history books alongside the evil despots of the past.

[This is Part II of David DeGraw's report, "The Economic Elite vs. People of the USA," originally published at Amped Status. Click here for Part I. Read more of David McGraw's writing here.]

© 2010 Amped Status

Source / Amped Status / AlterNet

• Find The Economic Elite Vs. The People of the United States of America by David McGraw at Amped Status.

Thanks to S.M. Wilhelm / The Rag Blog

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Money Alone Is Not Wealth

America, smitten with financial sector, must build true wealth
By Anna Manzo / Thursday, August 27, 2009

The unemployment rate at the end of July was 9.4 percent and is expected to reach 10 percent by year’s end. If part-time workers who want full-time jobs and those who have given up hope for a new job are included, the current jobless rate jumps to 16 percent.

Could it be that jobs are disappearing because society values money and profits over wealth created by production of goods and services? Companies routinely cut labor costs — namely, individuals’ compensation for producing — to maximize profit. How sustainable is that?

Since the global economy is requiring massive government bailouts, it’s time to rethink “wealth” and how valuing money and profit over people affects a society.

Dean Baker, macroeconomist with the Center for Economic and Policy Research, points out that the U.S. financial sector does not directly provide a good or a service. Its primary activity is mediating buying and selling. In the 1940s, the sector created less than 6 percent of corporate profits. It was still under 10 percent in the 1960s, but it was 30 percent in 2004.

Critics of government bailouts say Wall Street now focuses on “making money off money,” which enriches the wealthy but creates fake wealth: wealth created by accounting entries, commissions, fees, debt pyramids, predatory lending or the inflation of asset bubbles unrelated to creation of goods and services.

John C. Edmunds, a finance professor at Babson College known as an advocate of financial expansion, had been advising governments for at least a decade that “an economic policy that aims to achieve growth by wealth creation does not need to increase the production of goods and services, except as a secondary objective.”

In 1996, he declared that financial securities were the leading components of wealth; their fast growth would soon be more than two years’ worldwide output of goods and services.

Critics say the Federal Reserve allied with the U.S. Treasury and Wall Street banks to give higher priority to creating this “fake” wealth rather than producing actual wealth.

The Fed pursued cheap money policies to encourage borrowing by speculators to support inflation. Meanwhile, publicly traded corporations sought to increase share prices by outsourcing production to low-wage countries without labor unions, undermining the industrial sector once responsible for America’s largest economic growth.

Such priorities also led to massive deregulation of the financial sector, allowing exploiters such as Bernard Madoff and Allen Stanford to bilk their investors of billions. Academics, business interests and their lobbyists, media such as CNBC and policymakers dependent on campaign contributions had complicity in the deregulation.

In 1999, banking, insurance and real estate lobbying successfully got repeal of the Glass-Steagall Act, enacted in 1933 to protect depositors by mandating separation between speculative investment firms and commercial banks, backed by deposits.

With fewer protections, exotic “financial instruments” proliferated, including an estimated $56 trillion in unregulated “credit default swaps.” That is equal to the world’s gross domestic product. The exotic “instruments” collapsed as subprime mortgages defaulted.

CEOs from America’s largest financial corporations involved in the collapse collected vast sums of money by questionable means, while driving their companies and unsuspecting investors into bankruptcy.

Hardworking people who invested in 401(k)s, stocks, bonds and mortgages are facing loss of jobs, homes and pensions. They entrusted the fruit of their labor to a financial sector they didn’t know resembled a casino.

In 2005, Forbes magazine reported 691 billionaires worldwide. In 2008, there were 1,250 billionaires with an estimated combined wealth of $4.4 trillion. According to a United Nations study, the richest 2 percent of the world’s people now own 51 percent of the world’s assets. The poorest 50 percent own 1 percent.

Baker notes that maintaining the rate of productivity growth of goods and services enjoyed between 1943 and 1975 would enable reducing the average workweek to 21 hours or adding 24 weeks of vacation while still having the same real income in 2030 as we have today.

A return to sustainable local economies is sorely needed. Wall Street’s critics have noted that money is not wealth; it is useless until exchanged for something of value. For example, $1 billion spent to safeguard Middle East fossil fuel supplies takes a toll in military combat deaths and injuries, expensive consequences not incurred with $1 billion invested in renewable energy jobs.

True wealth is priceless: healthy, self-sustaining families and communities; a world free of homelessness, crime, war and terrorism; and retirements spent in dignity, not destitution. It’s time to get priorities straight. Money alone is not wealth.

[Anna Manzo is a New Haven Register copy editor and Web editor/producer for “Between The Lines,” a radio news magazine heard on 45 radio stations in the United States, Canada and Australia.]

Source / New Haven Register

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What's Wrong with This Picture?

Forbes publishes list of 400 wealthiest Americans
By Tom Eley / September 24, 2008

Even as the US careens into its greatest economic calamity since the Great Depression, the financial aristocracy whose parasitism and criminality has brought on the crisis has held its own—and then some.

The recently released Forbes 400 list of the richest Americans shows that the combined wealth of the aristocracy has increased 2 percent, even amidst the financial breakdown and recession of the economy. “In this, the 27th edition of the list,” Forbes glumly notes, “the assembled net worth of America’s wealthiest rose by $30 billion — only 2% — to $1.57 trillion.”

Readers will be forgiven for tripping over the word “only” in relationship to a $30 billion increase in wealth for 400 spectacularly wealthy individuals. This “modest” figure—the increase in wealth for the oligarchy in a bad year—is only slightly less than the federal government has budgeted for unemployment insurance for all of 2008.

The overall wealth of the 400 richest Americans is staggering. There are no multimillionaires on the list; a minimum of $1.3 billion being required to gain admittance, while the average net worth is $3.9 billion.

The combined wealth of the richest 400 individuals is $400 billion more than the entire discretionary spending budget for the federal government. It is more than $300 billion larger than the combined 2008 outlay for Social Security, Medicare, and Medicaid. It is more than 15 times the combined appropriations for education and highways and mass transit.

The personal wealth of the top 400 Americans is more than twice the combined annual GDP of all of sub-Saharan Africa, home to nearly 800 million people, the vast majority of whom live in dire conditions. It is also several hundred billion dollars larger than the GDP of the world’s eighth biggest economy, that of Spain.

The club’s richest member is Microsoft magnate Bill Gates, whose net worth, $57 billion, is greater than the annual GDP of about 120 of the world’s 180 nations.

The year’s biggest winner is New York City Mayor Michael Bloomberg, whose personal wealth increased by $8.5 billion to $20 billion, making Bloomberg the nation’s eighth richest individual.

On Tuesday, without a hint of irony—much less shame—Mayor Bloomberg proposed brutal across-the-board budget cuts for the city of New York. He is calling for cutbacks totaling $500 million for the current fiscal year, to be followed by much steeper cuts in the coming years. Meanwhile Bloomberg, in the course of just one year, pocketed 17 times what he is now demanding that millions of working people in New York City forfeit in terms of vital services and jobs. Only in America!

However, owing to the turbulence of the stock market, great fortunes were being both made and squandered even as Forbes published its list. “The Forbes 400 is a snapshot of estimated wealth on Aug. 29, 2008, the day we locked in prices of publicly traded stocks,” the magazine wrote. “Given how unsettled the stock market is, some of those on our list will become significantly richer or poorer within weeks—even days—of publication. Many, including AIG shareholders Eli Broad and Steven Udvar-Hazy, have lost hundreds of millions of dollars.”

Becoming poorer is of course a relative process; we can be certain that none of the demoted oligarchs faces hunger.

Among this year’s biggest “losers”—and there is a degree of poetic justice in this—are casino moguls. Kirk Kerkorian has managed to squander $6.8 billion of ill-gotten social wealth, while the fortune of his rival Sheldon Adelson “has fallen $13 billion in the past 12 months—$1.5 million per hour.” Adelson has managed to lose more in an hour than most US workers will earn in a lifetime.

That the nation’s financial aristocracy continues to gorge itself even as the economy stagnates demonstrates the increasing parasitism of the elite. The wealth of the super-rich is no longer bound up with the growth of the real economy, as it was in the days of Carnegie, Rockefeller, and Ford. Just the opposite is the case. The wealth of the aristocracy is based on the plundering and destruction of the real economy.

A perusal of the basis of the Forbes 400 members’ wealth illustrates the parasitic nature of US capitalism. The largest two categories on the list are “finance” with 65 members and “investments” with 51. Among the “sources” Forbes lists for these categories are “leveraged buyouts,” “investments,” “hedge funds,” “money management,” and “banking, insurance.”

The next largest category is “media/entertainment,” with 36 representatives among the Fortune 400, followed by the 35 members in the highly toxic “real estate” category. There are 30 members of the Fortune 400 who have reaped their fortunes from “technology,” almost all from Internet ventures or computer technology. Twenty-eight more are found in the “oil/gas” category.

Among the Fortune 400 there are 20 in the “retail” group, among them seven members of the Walton clan, owners of Wal-Mart, who collectively have assets of over $100 billion.

It has to be asked: Are there any members of the Forbes 400 actually associated with producing commodities or creating wealth of some sort?

There are only 19 members of the 400 in the category called “manufacturing.” However, upon inspection we see that this group is comprised of corporate raiders, oil refiners, inheritors, and controllers of holding companies. Only five members of this classification are actually associated with producing a commodity—and four of these produce light consumer goods.

Likewise, there are only 11 members of the financial aristocracy whose wealth has been associated with commodity production in the agricultural sector. But among these, nine are inheritors of the Cargill fortune. Of the other two, one has gained his fortune selling discount cigarettes; another by producing pesticides in Argentina.

There are nine members of the group in the “apparel” category, which is split between those whose wealth has come from retail sales, such as the owners of the Gap clothing stores, and those who have made windfalls by producing consumer goods in low-cost countries and selling the products for inflated prices in the US, such as Phil Knight of Nike.

There is only one member of the “construction/engineering” category, the 321st richest American, Alfred Clark, who has made his fortune by building sports stadiums. The “food” category, of which there are 21 members, is divided among retailers, inheritors, and the owners of single product lines, including the owner of the Slim-Fast empire. There are only three members of the “shipping/trucking/transport” category, and one member of “mining/lumber” (whose wealth came from overseas ventures).

In short, the incredible fortunes accumulated by the American elite have precious little to do with socially useful production. On the contrary, the financial aristocracy has reaped its obscene piles of wealth from the gutting of infrastructure, the shuttering of industrial production, and the impoverishment of working people, the broad mass of the population.

Copyright 1998-2008 World Socialist Web Site - All rights reserved

Source / World Socialist Web Site

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"Equal Opportunity": Just Another Fairy Tale

A note of appreciation from the rich
By Author Unknown / September 21, 2008

Let's be honest: you'll never win the lottery.

On the other hand, the chances are pretty good that you'll slave away at some miserable job the rest of your life. That's because you were in all likelihood born into the wrong social class. Let's face it -- you're a member of the working caste. Sorry!

As a result, you don't have the education, upbringing, connections, manners, appearance, and good taste to ever become one of us. In fact, you'd probably need a book the size of the yellow pages to list all the unfair advantages we have over you. That's why we're so relieved to know that you still continue to believe all those silly fairy tales about "justice" and "equal opportunity" in America.

Of course, in a hierarchical social system like ours, there's never been much room at the top to begin with. Besides, it's already occupied by us -- and we like it up here so much that we intend to keep it that way. But at least there's usually someone lower in the social hierarchy you can feel superior to and kick in the teeth once in a while. Even a lowly dishwasher can easily find some poor slob further down in the pecking order to sneer and spit at. So be thankful for migrant workers, prostitutes, and homeless street people.

Always remember that if everyone like you were economically secure and socially privileged like us, there would be no one left to fill all those boring, dangerous, low-paid jobs in our economy. And no one to fight our wars for us, or blindly follow orders in our totalitarian corporate institutions. And certainly no one to meekly go to their grave without having lived a full and creative life. So please, keep up the good work!

You also probably don't have the same greedy, compulsive drive to possess wealth, power, and prestige that we have. And even though you may sincerely want to change the way you live, you're also afraid of the very change you desire, thus keeping you and others like you in a nervous state of limbo. So you go through life mechanically playing your assigned social role, terrified what others would think should you ever dare to "break out of the mold."

Naturally, we try to play you off against each other whenever it suits our purposes: high-waged workers against low-waged, unionized against non-unionized, Black against White, male against female, American workers against Japanese against Mexican against.... We continually push your wages down by invoking "foreign competition," "the law of supply and demand," "national security," or "the bloated federal deficit." We throw you on the unemployed scrap heap if you step out of line or jeopardize our profits. And to give you an occasional break from the monotony of our daily economic blackmail, we allow you to participate in our stage-managed electoral shell games, better known to you ordinary folks as "elections." Happily, you haven't a clue as to what's really happening -- instead, you blame "Aliens," "Tree-hugging Environmentalists," "Niggers," "Jews," Welfare Queens," and countless others for your troubled situation.

We're also very pleased that many of you still embrace the "work ethic," even though most jobs in our economy degrade the environment, undermine your physical and emotional health, and basically suck your one and only life right out of you. We obviously don't know much about work, but we're sure glad you do!

Of course, life could be different. Society could be intelligently organized to meet the real needs of the general population. You and others like you could collectively fight to free yourselves from our domination. But you don't know that. In fact, you can't even imagine that another way of life is possible. And that's probably the greatest, most significant achievement of our system -- robbing you of your imagination, your creativity, your ability to think and act for yourself.

So we'd truly like to thank you from the bottom of our heartless hearts. Your loyal sacrifice makes possible our corrupt luxury; your work makes our system work. Thanks so much for "knowing your place" -- without even knowing it!

Source / Information Clearing House

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Jim Hightower : 'Lifestyles of the Rich... and Cranky.'

Ferrari F430 Spider, just $3,500 a day. Dude.
Democratizing luxury
By Jim Hightower / July 11, 2006

Time to take another peek into the “Lifestyles of the Rich… and Cranky.”

A problem for many rich people is that they’re merely rich – not fabulously wealthy. And, of course, being Mr. Richie Rich means never having to ask the price of anything. So the merely rich get cranky because, while they might be millionaires, it can be hard for them to keep up with the Joneses who are billionaires. I’m sure you can empathize with their angst.

Take the matter of transportation. In some zip codes, you are what you ride, and mass-market mobiles like Cadillacs and Hummers are simply humdrum vehicles, even if they come with uniformed chauffeurs. No, no, it’s important that your wheels make a statement, so you want something like a Bugatti Veyron, with its 978-horsepower engine. The Bugatti is a favorite of Mr. Richie Rich, but with a sticker price of $1.6 million, it’s out of reach for the merelies.

Luckily, though, enterprising saviors like Beverly Hills Rent-A-Car let common millionaires keep up appearances. While these modestly-wealthy swells can’t afford to buy a sleek Aston Martin Vantage Coupe with a powerhouse engine that has “a nice purr to it” – they can rent one for only $1,600 a day. Or, if they want to strut their stuff in even higher style, they can get behind the wheel of a red Ferrari F430 Spider for $3,500 a day. Its “wow” factor is that it can go 200 miles per hour. Be warned, though, that the $3,500 rental fee only gets you 50 miles a day – it’s an extra $2 a mile beyond that.

Oh, and that eye-popping Bugotti? Yes, for ultimate showmanship, you can even rent one of those babies for $25,000 a day.

In these days of economic stress, it’s good to know that luxury is being democratized so mere millionaires are not priced out of the good life.

“A posh ride, for a day,” Los Angeles Times, June 6, 2008

Source. / Jim Hightower

See A posh ride, for a day / Los Angeles Times

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