The Top 1% of Americans Have Taken $50 Trillion from the economy?
Tell me it's all a big lie and after having getting off the gold standard in 1971 had nothing to do with it!
serf
The three decades following the Second World War saw a period of
economic growth that was shared across the income distribution, but
inequality in taxable income has increased substantially over the last
four decades. This work seeks to quantify the scale of income gap
created by rising inequality compared to a counterfactual in which
growth was shared more broadly. We introduce a time-period agnostic and
income-level agnostic measure of inequality that relates income growth
to economic growth. This new metric can be applied over long stretches
of time, applied to subgroups of interest, and easily calculated. We
document the cumulative effect of four decades of income growth below
the growth of per capita gross national income and estimate that
aggregate income for the population below the 90th percentile over this
time period would have been $2.5 trillion (67 percent) higher in 2018
had income growth since 1975 remained as equitable as it was in the
first two post-War decades. From 1975 to 2018, the difference between
the aggregate taxable income for those below the 90th percentile and the
equitable growth counterfactual totals $47 trillion. We further explore
trends in inequality by applying this metric within and across business
cycles from 1975 to 2018 and also by demographic group.
President Richard Nixon’s actions in 1971 to end dollar convertibility to gold and implement wage/price controls were intended to address the international dilemma of a looming gold run and the domestic problem of inflation. The new economic policy marked the beginning of the end of the Bretton Woods international monetary system and temporarily halted inflation.
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So? Does it argue for equality of outcome in a neutral playing field, or does it argue for equality of opportunity? You can give two men $10,000 at age 15 and one will be broke by age 20 and the other will be nearing $20,000. From there the gains are geometric.
I started with a small nest egg when my kids were young, pre-teen. I invested it with jointly owned accounts and their "permission" and we watched it grow. When they reached 16 it was no longer "In Trust For" and the kinds manage it now. One of them has nearly quintupled her nest egg and the other is happy to let it ride with the investments we chose together. One will be a millionaire before she's 50 and the other will simply have a nice fat nest egg. Same environment, same rules, different tastes for risk/reward.0 -
Being lazy and not wanting to download and read the report this synopsis is from, I wonder if it addresses any of the non taxable wealth that those below the 90th percentile have accumulated, 401K plans for example? A few thousand a year plus the employer contribution X the number of plans probably adds up to quite a bit. Bob 3 -
BobJudy said:Being lazy and not wanting to download and read the report this synopsis is from, I wonder if it addresses any of the non taxable wealth that those below the 90th percentile have accumulated, 401K plans for example? A few thousand a year plus the employer contribution X the number of plans probably adds up to quite a bit. BobAny additions if even true was wipe out with 2007-8 debacle after Congress repealed The Banking Act of 1933 (a.k.a. the Glass-Steagall Act) so it was all a big set up and the elites have really took care of themselves at our expense. I think the pitch forks and sickles are getting ready to be use again,myself.
Derivatives will be the undoing of it all real soon.
serf
Then-President George W. Bush had no explanations. He could only urge fortitude. "In the short run, adjustments in the financial markets can be painful—both for the people concerned about their investments and for the employees of the affected firms,” he said, attempting to quell potential panic on Main Street. “In the long run, I'm confident that our capital markets are flexible and resilient and can deal with these adjustments." Privately, he sounded less sure, saying to advisors, "Someday you guys are going to need to tell me how we ended up with a system like this.… We're not doing something right if we're stuck with these miserable choices."And because that system had become a globally interdependent one, the U.S. financial crisis precipitated a worldwide economic collapse. So…what happened?
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I know it may sound selfish of me but when the mortgage backed crash occurred, I doubled my 401K contributions and continued to do so until I retired in 2010. That small account is now worth 3 times what it was in 2010. While I am far from being in that wealthy percentile I am actually better off financially than I was when I retired. I am not alone and if you add up all the non taxable assets owned by us average folks I bet the number would be astounding. That is why I asked if the report took that into account.
Fortunately, wealth in this country is limitless. Just because there are a rich few doesn't mean that there isn't a way for you to become wealthy without taking from/ taxing the mega rich. Currency, precious metals, gems are a way of making that wealth portable but we could actually use any agreed upon medium for that. The wealth that disappeared in 2008 was not currency or any common means of exchange. It was the value of what the currency could buy. Real estate, stocks, commodities all became cheaper and the key was to invest your currency into assets at the right time. Bob3 -
Your just a timer investor and recovered but a lot people lost thousands in there investments then and grow tired of debt giveaways to prime the old debt machine .The Federal Reserve is bailing out big businesses by the billions now and the banks just sit on there reserves.
There will come a time when the mask is pulled off this ponzi debt scheme and it will be very soon in my opinion. Keynesian money theory and fractional banking is just a shell game to fool the little people and intrinsic money will be coming back in a very big way and if taxes increase to keep the shell game going there is going to be trouble in my opinion at least with the poor people struggling to feed their family and keeping a roof over their head.
serf
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Thanks, Karl.
Your concerns are noted.
Don0 -
they are useing it against the rest of us to further their agenda 0 -
If we were to return to "intrinsic money" then you will be putting a limit on how many people can rise out of poverty. By either using actual intrinsic money like gold and silver coins or backing money with hard assets one of two things will happen. Not enough to go around for everyone or massive inflation where gold is 10 times the value it is now and a loaf of bread is $50. Nether of these alternatives is very attractive compared to what we have now. Money is nothing but an agreed upon means of exchange, whether it is fiat or intrinsic. Gold was used as money because it was relatively rare, easily worked and durable. You could bury your gold coins in the backyard and dig them up a year later unchanged. Is that really necessary today? Bobserf said:Your just a timer investor and recovered but a lot people lost thousands in there investments then and grow tired of debt giveaways to prime the old debt machine .The Federal Reserve is bailing out big businesses by the billions now and the banks just sit on there reserves.
There will come a time when the mask is pulled off this ponzi debt scheme and it will be very soon in my opinion. Keynesian money theory and fractional banking is just a shell game to fool the little people and intrinsic money will be coming back in a very big way and if taxes increase to keep the shell game going there is going to be trouble in my opinion at least with the poor people struggling to feed their family and keeping a roof over their head.
serf
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Too many games with the old digits,you cannot spend your way out of a depression,the money has no intrinsic value and there comes a time when the faith in the game is over. They are holding the lid on it but it's going to blow soon .Roosevelt stole all the gold and it doubled in price over night so this time around there is nothing to exchange for The Federal reserve note,it's just a bond with no backers anymore. The show is about over especially if Biden wins.
Only a crypto gold would have a chance and it would be cashless and not very intrinsic to many.
serf
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If anybody has stolen trillions from the economy and wasted most of it, the guilty party is government. A classic example would be the welfare state and the war on poverty. The amount spent on poverty and welfare eclipses the national debt.
Worse of all we have more poverty and welfare than ever.3 -
That is because we are subsidizing poverty and making to many people comfortable being poor. I think we have substituted hand outs for hand ups. Kind of that old give a man a fish or teach a man to fish parable. Bobchiefr said:If anybody has stolen trillions from the economy and wasted most of it, the guilty party is government. A classic example would be the welfare state and the war on poverty. The amount spent on poverty and welfare eclipses the national debt.
Worse of all we have more poverty and welfare than ever.3
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