Graham has a disturbing statistic up, stating that The top 400 families control as much wealth as the bottom 60%. Here are a few other disturbing statistics:
The wealthiest 5% of Americans control 72% of America’s financial wealth. The bottom 80% control only 7% of the nation’s financial wealth. The richest 400 Americans have more combined wealth than the poorer HALF of all Americans. That means 400 people have more wealth than 150,000,000 people combined. American corporations saw record profits in 2010. Nearly 80% of all economic gains made in the past thirty years have gone to the richest 1%. In the 1970s, the average CEO made 30 times what an hourly worker made. Today, a CEO makes 300 times what an hourly worker makes.
March 21, 2011 at 10:26 pm
Those are some shocking statistics. I’m not sure that redistribution is the solution, though, at least not income tax. There is a peculiar oligarchic conception of freedom that permits any amount of money, assets, land etc to be considered ‘private property’. This obscene distortion of our intuitive sense of private property (i.e. what we can personally make use of in our everyday lives) carries with it the whole weight and authority of the state and its coercive power.
One can imagine a different system, in which no protection is offered for ‘property’ exceeding the ability of a person to make use of it without help; excess would revert to the commons, unless some kind of cooperative could be formed, a company not of hierarchy but of co-owners. Corporations would be democratic; no distinction between worker and shareholder; there would be no fat cats and no need for unions.
People are rightly concerned for their own freedom, especially their freedom of expression and so on. Such freedoms must remain inviolate, and America deserves credit for placing these at the centre of its own political system. Where the idea of freedom conflicts with justice is in the economic sphere: “Entre le fort et le faible, entre le riche et le pauvre, entre le maître et le serviteur, c’est la liberté qui opprime, c’est la loi qui affranchit” – Lacordaire
March 22, 2011 at 5:45 am
Good information.
It is unfortunate that the quoted article goes so fully into the populist damn-the-greedy-rich mode, forgetting to even ask whether or not this particular imbalance in the distribution of wealth might be at least influenced by strong structural incentives, rather than the supposedly unending “greed” of the upper classes–who doubtlessly see their own capital as brilliantly productive and therefore helpful on the whole. This reduces the structural flaws of capitalism to the personality flaws of the super wealthy, like peasants praying that their king will be a little more gracious next year.
March 22, 2011 at 5:51 am
Actually, the stat I quoted was that the top 400 families have as much as the bottom 60%. I doubt they control 60% of the wealth, because families from #401 on down are doing very well for awhile on the list.
March 22, 2011 at 12:26 pm
Ack, thanks for the correction Graham!
March 22, 2011 at 1:27 pm
Stanley,
I think you’re absolutely right and that this is a tremendously important point. If we see this as a matter of personal greed rather than structural dynamics our approach to solving this problem will be entirely different. We’ll go on a moral crusade rather than address that structural flaw.
March 22, 2011 at 10:15 pm
Joshua, I agree to some degree with your sentiment. I am not a socialist. I know many of you are, so don’t slam me too hard :) so I likewise do not consider redistribution a solution. I think socialism, like liberalism, merely favors one class over the others and takes away incentive from many who would produce things of benefit to all. I also adhere to the iron law of oligarchy as a general rule: no society seems to have gotten around the problem of the existence of the state or oligarchial power. Personally, my views more closely approximate corporatism, but because of the negative stigma attached to it I just get angry responses and name calling.
Ideally, I would like to live in a USA where each state had its own economic system, so long as each state would continue to pay federal taxes. Let some states practice socialism, others capitalism, others something in between. At the end of 50 years, we’ll see who is flourishing the best. Of course, that idea will never be popular.
March 23, 2011 at 2:09 am
In my view, liberalism does favour one class over another, by its insistance on economic freedom; social mobility, from a liberal viewpoint, is proof of equality. Whereas all it means in reality is that the makeup of the economic elite changes over time – everyone can aspire to bourgeois success. That’s not equality; meaningful equality would require the dissolution of classes altogether. (I do realise that ‘liberal’ means different things to different people, so maybe that’s a point of confusion there – in America, a nation founded on liberal principles, it has come to mean the only – totally compromised, ineffectual, identity-politics-obsessed – excuse for a left wing that’s available.)
I am avowedly a socialist, and my reservations about redistribution aren’t because I’m worried about meritocratic incentivising. Quite the reverse. I think redistribution is closing the door after the horse has bolted. That’s why I would prefer a revision to property law based on the principle that your private property rights extend only to what you and your family can actually use, personally. That would of course require a root-and-branch overhaul of every part of the economic system, and the political system too.
March 23, 2011 at 10:40 pm
I see Joshua, as a rule of thumb I use the term ‘liberalism’ in the economic sense when having philosophical conversations as not to confusing people with the American ‘Democrat’. As for distribution, well, I see where you are coming from now.
March 26, 2011 at 12:23 pm
As Warren Buffett once put it in an interview on CNN: “It’s class warfare, my class is winning”. Perhaps he used the wrong tense (should it be ‘won’?).
In fairness he also added: “But they shouldn’t be.”