Saturday, November 23, 2019

'Eye-Popping': Analysis Shows Top 1% Gained $21 Trillion in Wealth Since 1989 While Bottom Half Lost $900 Billion

"The top one percent owns nearly $30 trillion of assets while the bottom half owns less than nothing."

The growth of wealth inequality over the past 30 years, Bruenig found, is "eye-popping."
"Between 1989 and 2018, the top one percent increased its total net worth by $21 trillion," Bruenig wrote. "The bottom 50 percent actually saw its net worth decrease by $900 billion over the same period."

Common Dreams

'Eye-Popping': Analysis Shows Top 1% Gained $21 Trillion in Wealth Since 1989 While Bottom Half Lost $900 Billion


AXEC / E.K-H said...

Gosh! the One Percent have gotten $21 trillion richer: Links on Distribution
Comment on Common Dreams on ‘'Eye-Popping': Analysis Shows Top 1% Gained $21 Trillion in Wealth Since 1989 While Bottom Half Lost $900 Billion’*

In order to tackle distribution, it is certainly a good thing to have a valid Profit Theory. Economists, though, have to this day NO idea what profit is. Their multiple common-sense notions of profit stem from microeconomic observations that are subject to the Fallacy of Composition and therefore do not translate into macroeconomic profit.

The axiomatically correct macroeconomic Profit Law reads Q=Qm+Qn with Qm=Yd+(I−Sm)+(G−T)+(X−M). This Law tells one, among many other things, that Public Deficit G−T>0=Private Profit Qm which means that the Oligarchy’s financial wealth and public debt grow in lockstep. This explains, as a first approximation, why the “One Percent have gotten $21 trillion richer”. As it happens, the public debt stands currently around $22 trillion. Needless to emphasize that this back-of-the-envelope comparison can and must be greatly refined but it is good enough for now. The Profit Law explains the extremely skewed distribution of income and financial wealth. The primary distributional effect is reinforced by the interest on public debt.

Public deficit-spending/money-creation is a free lunch program for the Oligarchy. The fact is that the so-called market economy is already for a long time on the life support of the State. Profit is in the main produced by public deficits. The Oligarchy, in turn, uses the opulent free lunches to corrupt the State’s legislative, executive, judiciary institutions in its favor. This constitutes a positive feedback loop and this, in turn, explains the exponential deterioration of distribution.

MMTers claim that public deficits are a good thing because they increase “private” financial wealth. This is not quite correct because, on closer inspection, public deficits increase the financial wealth of the one-percenters and NOT of the ninety-nine-percenters. The weasel word “private” obscures this distributional fact. The MMT policy of permanent deficit-spending/money-creation amounts to a permanent self-alimentation of the Oligarchy to the detriment of the ninety-nine-percenters.

Of course, MMTers are Progressives and vehemently against the unequal distribution of income and wealth. They identify the Neoliberals as culprits and their greed-is-good philosophy and their austerity policy. It is important to note that bad philosophy and bad behavior cannot explain the amount of overall monetary profit Qm which is measurable with the precision of two decimal places and determined by simple balance mechanics.

The economic fact of the matter is: so-called free market economies like the USA have long been on full life-support of the State. The continuous creation of financial wealth has become the first and foremost economic task of the State. The Oligarchy is continuously fed by deficit-spending/money-creation. From the perspective of society, though, the Oligarchy’s financial wealth is roughly equal to public debt which means that the net financial wealth of society as a whole is zero. People think that public debt is the business of the State and forget that the State is only an intermediary which, in turn, means that economically they own the debt. So, when a private household calculates its net financial wealth it has to deduct its share of public debt. This is not done, of course, which means that private households are poorer than they think.

Economists in general and MMTers, in particular, deceive the general public about the distributional effects of deficit-spending/money-creation. That is their job as useful idiots of the Oligarchy.

Egmont Kakarot-Handtke

* Common Dreams


Kaivey said...

Do you support the welfare state?

AXEC / E.K-H said...


You ask: “Do you support the welfare state?”

The realization or elimination of the welfare state in the United States is the business of the Legitimate Sovereign of the United States. Nobody has to interfere in the process. Least of all science.

To recall, the principle of the separation of science and politics holds also for economics. It is self-evident and borne out by history that science cannot improve politics but politics always corrupts science.

The economist as scientist figures out how the economic system works. As a scientist I neither support right, center, nor left politics but have proved with the help of elementary logic/mathematics that the major approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism, MMT ― are proto-scientific garbage and that, by implication, Walrasians, Keynesians, Marxians, Austrians, MMTers are either stupid or corrupt or both.

Note that the abuse of science for political purposes comes always in the garb of the do-gooder, world-saver, philanthropist, welfare improver, and heroic fighter for WeThePeople. Real do-gooders do good and do not talk much about it while false do-gooders do much troll-talk on social media but nothing else.

Egmont Kakarot-Handtke

Kaivey said...

So, if a country wanted to tax people for a welfare state, it's fine? And a progressive tax system too?

Kaivey said...

Is it okay in your system if the government runs public services. What about nationalising the energy suppliers, the trains and buses? If this is what people wanted, would that be fine in your system?

Matt Franko said...

“The realization or elimination of the welfare state in the United States is the business of the Legitimate Sovereign of the United States. Nobody has to interfere in the process. Least of all science.”

Amen brother....

Good comment Egmont...

Matt Franko said...

“either stupid or corrupt or both.”

They’re stupid...