Wealth Inequality in the United States
Wealth inequality will only grow worse in the coming decade. (Robert Reich: The Widening Wealth Divide, Huffington Post) Most economists already know this but are reluctant to inform the general populace. The reason is built right into the above video. Most Americans already show a remarkable lack of awareness regarding the economic and class structures in place in the United States. The true state of affairs is simply beyond most people to truly understand either the scope or the effect of our political policy on this landscape. The economic elite have both the money and power to alter the behavior of businesses, governments, both local and federal and the media systems which provide information to the public ensuring their continued hegemony.
Just a few of the controls used by corporations to further their growth at the expense of everyone else:
- Avoiding taxation: Yes, large corporations and the very rich are shouldering the burden for the nation’s taxes but since they own 80% of the nations wealth, it makes sense, they should also pay 50% of its tax burden. But with that said, many large corporations pay almost no taxes by using offshore companies, keeping money in foreign banks or utilizing tax havens/loopholes allowing them to reduce their tax obligation.
- Stagnation of wages: Reducing the value of the work done by actual workers while increasing the value of the work done by managers and executives allows firms to force workers to work for less and fight for jobs while wages are systematically reduced. With politicians reducing options for unions, making states ‘right to work’, off-shoring, out-sourcing and other such tactics erodes the worker’s value while still increasing the profitability of corporations at their workers expense.
- Leveraging the value of money: Currently the dollar can be borrowed at fantastic rates, allowing companies to purchase smaller firms (thus our recent merger-mania) in order to gain further economic advantage by absorbing intellectual properties from smaller companies. While this is normally encouraged, during difficult economic times, it gives a greater advantage to companies which already have the capital to invest without risk.
- Control of media: The media is a powerful tool when dealing with the expectations of the public. Control of media agencies gives corporations (and often the politicians they lease) the ability to tailor messages to make themselves appear in a positive light even while they are convincing the people to vote against their own interests, either by making the information too difficult to absorb (i.e. the debt ceiling debate) or wearing people out with the constant bombardment of news coverage until people tune out and are unable to make informed decisions. Media saturation or complete blackouts are both effective ways of allowing corporations to manipulate the mindset of the public.
Here is a twitter-stream and associated documents which expand on this video further in my Storify collection: Wealth Inequality in America