Here’s a summary of the economic disaster that has hit the U.S.: There’s a report from the Economic Policy Institute, The New Gilded Age, and I quote from page 12, “The pattern in the distribution of income growth reversed itself from 1973 to 2007 as the income of the bottom 99 percent of families grew much more slowly (by just 15.4 percent) compared with the top 1 percent, whose average income grew by 216.4 percent. As a result, over half (58.7 percent) of all income growth in this period landed in the hands of the top 1 percent of families. (Data are shown in Appendix Table B8.)”
What happens to wealth that is not consumed? It pumps up asset prices, mostly financial asset prices. The Fed’s Flow of Funds report, page 2, shows that “net household worth” increased from $48 trillion in January, 2009, to $109 trillion in December, 2018 – adjusting for inflation it is less than doubling.
Fortunately now both Senators Sanders and Warren have proposed a surtax (Sanders) and a wealth tax (Warren). And I’m not done – the United Way charity has issued a report, ALICE, that 40% of Americans cannot pay their monthly expenses including food, shelter, utilities, medical care, transportation, phone service and child care – see United Way ALICE (Asset Limited, Income Constrained, Employed). So the system is clearly not serving the people adequately.
My blog: Economics Without Greed, http://benL8.blogspot.com