FacebookTwitterGoogle+RedditEmail

Inequality Will Increase Until There’s a Revolution

Imagine, after a deep sleep, you suffered the fate of Rip Van Winkle and woke in the spring of 2040. What might you find?

Among other things, maybe a presidential candidate railing against America’s concentration of wealth. Except this time, it’s not the 1 percent that owns as much wealth as the bottom 90 percent — it’s the top hundredth of a percent.

Could it get that bad? Yes, quite easily. In fact, that nightmare is already on the way.

To see this better, take a step back in time. If you woke up 24 years ago, you could hear candidate Bill Clinton lamenting the fact that the top 1 percent owned as much wealth as the bottom 90 percent.

Today, as anyone who’s heard Bernie Sanders give his stump speech knows, it’s the top tenth of 1 percent who owns that much. That’s 10 times more concentrated — and it’s happened over just six presidential cycles. If the trend continues, the scenario I presented at the outset will be a reality.

Here’s another way to look at it: In 1992, when Bill Clinton first found America’s wealth concentration unacceptable, the average person in the top hundredth of a percent was about 1,100 times wealthier than the average person in the bottom 90 percent. By 2012, the most recent year for which statistics are available, that ratio had quadrupled, to approximately 4,500 times.

If the numbers I predicted for 2040 hold, that figure will rise to 9,000 times. If the average net worth is around $30,000 then — a sliver of equity in a modest home — then the average household in the top hundredth of a percent will be worth over $250 million.

Can America avoid such a dismal future?

Yes, but only if the philosophy underlying our tax policy changes. We can’t just raise revenue and distribute the tax burden in a way our leaders deem fair. Preventing undue accumulations of wealth must become a cornerstone of American tax policy.

That would entail three fundamental changes.

First, lawmakers must abandon the policy of taxing investment income — which flows almost exclusively to the wealthiest Americans — far less heavily than income from labor, the income on which the rest of us depend.

Second, they should increase the top marginal income tax rate substantially for those with huge incomes. Ludicrously, current rates subject a billionaire with a nine-figure income to the same top marginal income tax rate as a doctor making $500,000. That’s a major factor in our worsening wealth inequality.

Third, the gigantic loopholes in the estate tax system, which allow even billion-dollar estates to escape taxation when they’re passed on to the next generation, must be closed and the top estate tax rate increased.

Possible? Yes, but it will take a revolution.

This column is distributed by OtherWords.org.

More articles by:

Bob Lord is a veteran tax lawyer who practices and blogs in Phoenix, Arizona. He’s an associate fellow of the Institute for Policy Studies. 

Weekend Edition
January 18, 2019
Friday - Sunday
Melvin Goodman
Star Wars Revisited: One More Nightmare From Trump
John Davis
“Weather Terrorism:” a National Emergency
Jeffrey St. Clair
Roaming Charges: Sometimes an Establishment Hack is Just What You Need
Louisa Willcox
Sky Bears, Earth Bears: Finding and Losing True North
Robert Fisk
Bernie Sanders, Israel and the Middle East
Robert Fantina
Pompeo, the U.S. and Iran
David Rosen
The Biden Band-Aid: Will Democrats Contain the Insurgency?
Nick Pemberton
Human Trafficking Should Be Illegal
Steve Early - Suzanne Gordon
Did Donald Get The Memo? Trump’s VA Secretary Denounces ‘Veteran as Victim’ Stereotyping
Andrew Levine
The Tulsi Gabbard Factor
John W. Whitehead
The Danger Within: Border Patrol is Turning America into a Constitution-Free Zone
Dana E. Abizaid
Kafka’s Grave: a Pilgrimage in Prague
Rebecca Lee
Punishment Through Humiliation: Justice For Sexual Assault Survivors
Dahr Jamail
A Planet in Crisis: The Heat’s On Us
John Feffer
Trump Punts on Syria: The Forever War is Far From Over
Dave Lindorff
Shut Down the War Machine!
Glenn Sacks
LA Teachers’ Strike: Student Voices of the Los Angeles Education Revolt  
Mark Ashwill
The Metamorphosis of International Students Into Honorary US Nationalists: a View from Viet Nam
Ramzy Baroud
The Moral Travesty of Israel Seeking Arab, Iranian Money for its Alleged Nakba
Ron Jacobs
Allen Ginsberg Takes a Trip
Jake Johnston
Haiti by the Numbers
Binoy Kampmark
No-Confidence Survivor: Theresa May and Brexit
Victor Grossman
Red Flowers for Rosa and Karl
Cesar Chelala
President Donald Trump’s “Magical Realism”
Christopher Brauchli
An Education in Fraud
Paul Bentley
The Death Penalty for Canada’s Foreign Policy?
David Swanson
Top 10 Reasons Not to Love NATO
Louis Proyect
Breaking the Left’s Gay Taboo
Kani Xulam
A Saudi Teen and Freedom’s Shining Moment
Ralph Nader
Bar Barr or Regret this Dictatorial Attorney General
Jessicah Pierre
A Dream Deferred: MLK’s Dream of Economic Justice is Far From Reality
Edward J. Martin
Glossip v. Gross, the Eighth Amendment and the Torture Court of the United States
Chuck Collins
Shutdown Expands the Ranks of the “Underwater Nation”
Paul Edwards
War Whores
Alycee Lane
Trump’s Federal Government Shutdown and Unpaid Dishwashers
Martha Rosenberg
New Questions About Ritual Slaughter as Belgium Bans the Practice
Wim Laven
The Annual Whitewashing of Martin Luther King Jr.
Nicky Reid
Panarchy as Full Spectrum Intersectionality
Jill Richardson
Hollywood’s Fat Shaming is Getting Old
Nyla Ali Khan
A Woman’s Wide Sphere of Influence Within Folklore and Social Practices
Richard Klin
Dial Israel: Amos Oz, 1939-2018
Graham Peebles
A Global Battle of Values and Ideals
David Rovics
Of Triggers and Bullets
Elliot Sperber
Eddie Spaghetti’s Alphabet
January 17, 2019
Stan Cox
That Green Growth at the Heart of the Green New Deal? It’s Malignant
FacebookTwitterGoogle+RedditEmail