How to Cripple an Economy, Part 3: Wealth Gap Multipliers

[One note here at the outset:  the wealth gap multipliers are not really “hidden pieces” as my headline below implies, but they are pieces that most people don’t think about when they speak of income disparities and tax policy. But they are pieces you can’t separate from the whole picture of economic disparities, and are arguably just as important a topic of discussion as income taxes.  Bernie Sanders speaks about it, but unfortunately his bombast tends to cause independent voters—the ones who increasingly make the differences in elections—to tune out.]

Hidden Pieces of the Tax and Wealth Puzzle: Wealth and Wealth Gap Multipliers

Regardless of specific amounts, even at comparable incomes (say, within one order of magnitude, $75,000 to $150,000), those with wealth behind them are many times more secure than those with little wealth.  (Note that I plucked these numbers out of national averages; of course incomes and expenses are far greater in many major cities and upscale suburbs.  Incomes are far lower among the poor and much of the lower middle class, of whom to speak of their nonexistent “wealth” is a bitter irony.)

To state the obvious: the wealthy have something to fall back on in hard times and personal emergencies.

Moreover, their wealth expands through wealth multipliers.

I have not looked at exact disparities in wealth in the U.S. for 20 years, since it was bad then and has obviously been getting worse.  The Great Recession of 2007-2009 amplified the wealth disparity, and it  hasn’t improved since then. (For a good idea of where it’s all going, read Plutocrats by Chrystia Freeland. )

Multiplier Number One, Race: note that the hardest hit are people of color, where the wealth gap is worse than for whites, and widening: see CNN analysis at Racial wealth gap in 2016

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World Order 2.0 and National Debt

Richard Haass Stumps for a Reset of World Order, Targets National Debt

Centrist Big Thinker and President of the Council on Foreign Relations Richard Haass has a new book out, The World in Disarray: American Foreign Policy  and the Crisis of the Old Order. As I gleaned from an interview on NPR’s Morning Edition today, and from the summary offered on Amazon, he’s looking for a reset (my word) of our foreign policy that recognizes our limitations but still projects our strength—reflecting “the reality that power is widely distributed and that borders count for less.”

In case you were wondering, Haass was pretty satisfied with the world order from the Cold War up through September 11, 2001. It may have been a tense world order, but at least it was orderly. Sort of.

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