It feels like we’ve returned to the days of the so-called “robber barons” of the 19th Century. J.P Morgan and Andrew Carnegie, had nothing on this current batch of 21st Century Wall Street high rollers.
Our contemporary economic nightmare began with the supply-side “trickle down” economics of the Reagan Administration in the 80’s. At the Time, President George H.W. Bush blasted the idea, saying “it just isn’t going to work.” His term for it was “Voodoo Economics.” Which is what it was. Mr. Reagan cut taxes for the wealthy only to turn around and raise taxes eleven times, according to Alan Simpson. Something those on the right would like us to forget as”trickle down” is now more powerful than ever despite the fact that George H.W. Bush, was right. Consider the following from Steven Rattner, in the New York Times-
“In 2010, as the nation continued to recover from the recession, a dizzying 93 percent of the additional income created in the country that year, compared to 2009 – $288 billion – went to the top 1 percent of taxpayers, those with at least $352,000 in income. That delivered an average single-year pay increase of 11.6 percent to each of these households.
Still more astonishing was the extent to which the super rich got rich faster than the merely rich. In 2010, 37 percent of these additional earnings went to just the top 0.01 percent, a teaspoon-size collection of about 15,000 households with average incomes of $23.8 million. These fortunate few saw their incomes rise by 21.5 percent.
The bottom 99 percent received a microscopic $80 increase in pay per person in 2010, after adjusting for inflation. The top 1 percent, whose average income is $1,019,089, had an 11.6 percent increase in income. “
How much of all that wealth that’s flowing to the top has trickled back down to average folk by way of a stimulated economy providing more jobs? It’s not happening, because the jobs have been off-shored to China, India, and other developing nations. Millions of jobs. And don’t kid yourself. They aren’t coming back.
That’s okay though. The lower 99% have credit cards to live on as they struggle to pay the ever increasing costs of gasoline, groceries, healthcare and housing, making the top 1% even richer. Goodbye, American middle class.
The extraction of wealth by the very rich obviously contributes to the growing disparity between the rich and the poor. It’s clearly unsustainable and with our current leadership vacuum in Washington, the situation will eventually be resolved in the streets. It has to. When people can’t get jobs to make money to feed their families, it leads to unrest. However, to date, the attitude of the captains and the kings of high finance and industry appears to be, “Let them eat cake.” Clearly, they’ve forgotten the lessons of history. Or perhaps, they never learned? Or maybe they’re living in a bubble, blinded by greed.
Teddy Roosevelt, stepped up and took on J.P. Morgan and his “too big to fail” buddies on Wall Street all those years ago. Roosevelt, by the way, was a Republican. As was George H.W. Bush. Sometimes, they get it right. Who do we have?