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Wednesday, March 16, 2011

WE ARE FAR TOO TOP-HEAVY!

"Corporations are NOT people! Money is NOT free speech!"
- TomCat, www.politics.plus.org -


"Advertising is legalized lying."
- H.G. Wells -


Big business AND government have grown far too large and inefficient in this country. They have handicapped themselves by turning boards of directors into buddy clubs filled with out-of-touch officers who actually drag their companies down, by manufacturing a bogus air of profitability through the outsourcing of labor and cutting wages down. Huge corporations have managed to buy off large portions of Congress through massive campaign contributions to Republicans and Democrats alike. Corporate lobbyists, rather than Congresspersons, often write bills themselves and offer them up to be enacted! They have managed to corrupt government regulators to the point where these "regulators" are no longer acting in the vpublic's best interest. THAT, ladies and gentlemen, is why we see the government seemingly paralyzed and unable to deliver what we all need from it. It is the reason why only laws beneficial mainly to the privileged and wealthy get passed and why everyone else is left wanting. It is the reason why our activist Supreme Court has now allowed corporations the exact same rights as individuals, and has declared they may contribute all the cash they can muster to spend freely without restriction in our political campaigns!

This perverse corporate influence is rampant and permeates all areas of American life today. It is why TV shows are constantly interrupted by lying commercials which insult our intelligence, and why these obnoxious commercial breaks have steadily grown from 8 minutes per HOUR in the very early 1960s to roughly 22 minutes per HOUR today. It is the reason why American jobs have been exported outside of our borders; why our wages have flattened out or have even been reduced in recent years; why labor union power, influence, and membership have all declined to dangerously anemic levels over the past 40 years; and why the middle class is rapidly disappearing. This entire country is being squeezed so those at the top of the income scale may grow even wealthier than they have ever been.

This is NOT how democracy is supposed to function, and it is a dangerously regressive phenomenon which must be halted and reversed!


A revealing study by Norton & Ariely, 2010, shows that Americans are clueless about how the country's wealth is distributed or is as concentrated as it now is. (Left click on the graphs to make them larger if you need to). When shown three pie charts representing possible wealth distributions, 90% or more of the 5,522 respondents -- whatever their gender, age, income level, or party affiliation -- thought that the American wealth distribution most resembled one in which the top 20% has about 60% of the wealth. Of course, the top 20% actually control about 85% of the wealth!

Even more unbelievable, they did not come close to the amount of wealth held by the bottom 40% of the population: the lowest two groups which compose the lowest 40% hold just 0.3% of the wealth in the United States! Most people in the survey guessed the figure to be between 8% and 10%, and two dozen academic economists got it wrong too, by guessing about 2% -- seven times too high. Those surveyed did have it about right for what the 20% in the middle have; it's at the top and the bottom that they don't have any idea of what's really going on.

Table 3: Share of wealth held by the Bottom 99% and Top 1% in the United States, 1922-2007.
Bottom 99 percent / Top 1 percent
1922 63.3% / 36.7%
1929 55.8% / 44.2%
1933 66.7% / 33.3%
1939 63.6% / 36.4%
1945 70.2% / 29.8%
1949 72.9% / 27.1%
1953 68.8% / 31.2%
1962 68.2% / 31.8%
1965 65.6% / 34.4%
1969 68.9% / 31.1%
1972 70.9% / 29.1%
1976 80.1% / 19.9%
1979 79.5% / 20.5%
1981 75.2% / 24.8%
1983 69.1% / 30.9%
1986 68.1% / 31.9%
1989 64.3% / 35.7%
1992 62.8% / 37.2%
1995 61.5% / 38.5%
1998 61.9% / 38.1%
2001 66.6% / 33.4%
2004 65.7% / 34.3%
2007 65.4% / 34.6%

Sources: 1922-1989 data from Wolff (1996). 1992-2007 data from Wolff (2010).


Table 4: Percentage of wealth held in 2000 by the Top 10% of the adult population in various Western countries:
Switzerland 71.3%
United States 69.8%
Denmark 65.0%
France 61.0%
Sweden 58.6%
UK 56.0%
Canada 53.0%
Norway 50.5%
Germany 44.4%
Finland 42.3%
It is interesting to note that all of these countries EXCEPT THE UNITED STATES have generous universal health care services provided by their governments that are financed by their taxpayers!

Source: 2006 study, World Institute for Development Economics Research

Corporations love to talk about how lower taxes and huge profits are necessary to provide stockholders with generous dividend checks, as if millions of lower income folks will benefit. But as the table below clearly shows, only 8.9% of the bottom 80% of wage earners are even stockholders!

Table 5a: Concentration of stock ownership in the United States, 2001-2007
Percent of all stock owned:
Wealth class / 2001 / 2004 / 2007
Top 1% 33.5% / 36.7% / 38.3%
Next 19% 55.8% / 53.9% / 52.8%
Bottom 80% 10.7% / 9.4% / 8.9%


Table 5b: Amount of stock owned by various wealth classes in the U.S., 2007
Percent of households owning stocks worth:
Wealth class $0 (no stocks) / $1-$10,000 / More than $10,000
Top 1% 7.4% / 4.2% / 88.4%
95-99% 7.8% / 2.7% / 89.5%
90-95% 13.2% / 5.4% / 81.4%
80-90% 17.9% / 10.9% / 71.2%
60-80% 34.6% / 18.3% / 47.1%
40-60% 52.3% / 25.6% / 22.1%
20-40% 69.7% / 21.6% / 8.7%
Bottom 20% 84.7% / 14.3% / 2.0%

Source: Wolff, 2007 and 2010

THE TOP 400 WEALTHIEST AMERICAN WAGE EARNERS HOLD MORE WEALTH TODAY THAN THE BOTTOM 155 MILLION COMBINED!

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 has now dramatically risen to a whopping $90 for CEOs to $1 for the average worker!
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Graph courtesy www.politicsplus.org/

Our economy has become top-heavy, folks. This unhealthy trend toward repeated tax cuts for the very rich combined with ever-accelerating CEO pay and benefits coming at the expense of average workers' pay and benefits is unsustainable and must be REVERSED! Like most top-heavy items, if not corrected soon, the country itself will collapse altogether. The signs of economic collapse are all around us. Our infrastructure is in serious disrepair. Corporations grow greedier every day. Labor has become a scapegoat to be neutralized and exported. Debt is rising at an alarming rate.The very rich are sitting on their money or investing overseas while the country they were born in stagnates and putrifies.

A PEOPLE'S PARTY dedicated solely to reversing these threatening trends is the ONLY answer! It must restore the power of labor and, through government regulation, roll back runaway CEO pay, minimize corporate influence over government, and revamp our grossly unfair tax system which benefits only the very wealthy. It must reduce the power and influence of weak, blue dog Democrats and help push the hopelessly out-of-touch and ultra-conservative Republican Party into its deserved place on the scrap heap of history. Time is running out for the middle class. Proudly hoisting the banner of the People's Party, the middle class and poor must strike back NOW!

17 comments:

Tom Harper said...

This whole "rich getting richer" syndrome is one of those self-reinforcing vicious cycles, like a snowball rolling downhill.

The wealthier the richest 1% gets, the more money they have for bribing the government. The larger their bribes, the more rewards they get in the form of lower taxes for millionaires, fewer regulations, etc.

And the lower their taxes and regulations, the more money they can spend on bribing the government for even better tax breaks. And the beat goes on...

Jack Jodell said...

Tom,
That is why the next two election cycles (at least) are so very crucial. After years of ceding ground and getting smothered by these self-centered bastards, the time has now come for the 98% who have been getting screwed to rise up, take an activist stance, and turn the tables on them before it's too late. We MUST win the White House again next year and we MUST win Congress back, too, with greatly expanded majorities! That is why it is so important for each of us to become one of the People's Party faction, ATTEND YOUR LOCAL DEMOCRATIC CAUCUS NEXT YEAR, and, in general, take an activist approach and throw these Republicans and corporate-stooge teabaggers OUT for good! Our country will be a LOT better off with a progressive agenda being practiced, much like it had in the 1960s through most of the 1970s. At the very least, the middle class will be strengthened with a resurgance in the voice of labor.

S.W. Anderson said...

Uh, I left a comment on this post earlier today.

Dave Dubya said...

We are living in such sick and twisted times that democracy is now the radical solution.

Jolly Roger said...

The simple fact of the matter is, a topheavy society is a sh*t society. The economy doesn't work for anyone except those at the top. We passed the 13th and 14th Amendments to get rid of this kind of a structure, and the Constipatives have been trying to put it back ever since.

Jack Jodell said...

S.W.,
I don't know what could have happened to it! Please comment again.
---------------
Dave,
I hear ya, brother!
---------------
That's why we have to attack them with a broad People's Party front!

S.W. Anderson said...

Jack, could my comment have gone to a spam trap? There was a link to a book at Amazon in it, and depending on your settings, that might cause it to be sidelined as possible spam.

Jack Jodell said...

S.W.,
Could be. Just email me at jackjod@q.com, and type CAPITAL LETTERS in the subject heading. Sorry for the hassle.

Marc McDonald said...

Hi Jack, great and informative piece.

re:
>>>Americans are clueless about
>>>how the country's wealth is
>>>distributed or is as
>>>concentrated as it now is

This is one of the biggest problems I have in debating right-wingers.

Many of them insist that the rich are unfairly penalized and forced to pay too much in taxes. None of them grasp that America was a vastly more egalitarian society from the 1940s to the 1970s.

Indeed, thanks to the likes of Rush, many wingnuts are convinced that today's America has the narrowest gap between rich and poor that it ever has had, thanks to Obama's "socialist" parties.

When I tell them Obama is no progressive and is instead a bland corporate-friendly moderate, they always give me a blank stare.

Great societies aren't defined by the number of super-wealthy people, but rather by how prosperous the middle class is.
In the U.S. these days, the middle class is pretty much extinct.

Talk to any marketer and they'll tell you that 40 years ago, they focused their efforts on targeting the middle class. By contrast, today, marketers have what they call a "two-tiered" approach: either targeting the rich or the working class. There isn't much of an in-between any more.

Jack Jodell said...

Marc,
There is absolutely no forgiving right-wing ignorance. I would urge you to copy and paste this post, print it, and distribute it to every one of those unbelieving morons.

Conservatives in the time of Columbus argued that the world was flat and that Isabella and Ferdinand were wrong to fund his voyage. Where would this world be today if THEY had been so cocksure and ignorant as their conservative advisors were?

Rush Limbaugh and Fox "News" are doing a grave injustice to this country. They are paranoid voices of the past and present trying to prevent the inevitable future. And those who follow them are wholly unoriginal, mindless sheep! It is high time they WAKE UP to the fact that our taxes are FAR BELOW that of the rest of the world and that our rich aren't overtaxed at all, but are rather stealing from us to feather their own nest!

S.W. Anderson said...

Jack, I'll just hit the high spots.

This is an excellent post. More background and incredible depth and detail are available in Kevin Phillips' book, Wealth and Democracy: A Political History of the American Rich.

I can't recommend Phillips' book highly enough. If we could get even half of U.S. voters to read it, I doubt we would have another Republican president or Congress for a generation or more.

Jack Jodell said...

S.W.,
Thank you for that excellent recommendation. I WILL follow up on it and even do a future post based on it! After the shenanigans the GOP has pulled for the past 30 years, they should never again be able to capture Congress OR the White House!

Jack Jodell said...
This comment has been removed by the author.
Bobby Kearan said...

Great to see a whole lot more people becoming aware of this!

Its not a question of being Jealous of the wealthy - if they earned it, good for them. However, as money gushes up, the entire consumer base is weakened. Eventually, no workers have money to buy anything but maybe food and shelter. Economy collapses.

I am promoting "Ethical Capitalism can Save U.S." as a solution. Based on Henry Ford, "we believe in making twenty thousand men prosperous and contented rather than following the plan of making a few slave drivers in our enterprise multi-millionaires."

Dave Dubya said...

Last Friday Google took down my blog without notice.

Talk about a Kafkaesque experience. No warning, no explanation, no accusation even. I guess a lot of blogger world goes down because of misidentification as spammers. They also have a very Kafkaesque system of hoops and loops to jump through for a review.

I get a sick sense of foreshadowing from this that all politically incorrect blogs and information sources may meet the same fate when net neutrality is lost and corporatist government clamps down.

I'll take my davedubya.com elsewhere; Wordpress looks pretty good in comparison. I'm glad I saved all my posts and links.

Jolly Roger said...

Actually, corporate corruption makes Government in eras like Eisenhower's look downright efficient and pristine in comparison. Corporations are no longer driven by the urge to produce a better service, or product-they are driven by pure greed, which is a direct result of all the breaks both Rushpubliscums and Dumbocrats have been all to anxious to hand them. There has to be a check on greed, or what we see now always happens.

I say that a CEO not consumed with grabbing every dime he or she can get their hands on will be MORE concerned with putting out a quality product or service, since his or her pay will be just one concern among many, rather than THE concern. The system of allowing Corporate Boards to be staffed by intertwined members of different companies must also be addressed, since a Board member of Company "A" knows that the CEO of "A" will be voting on HIS package over at Company "B", where "A"'s CEO is a Board member.

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