OT: The Trickle Up Effect
- From: not <lordkoos@xxxxxxxxxxx>
- Date: Thu, 25 Oct 2007 11:50:03 -0700
Republican tax cuts in action:
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Billionaires Up, America Down
By Holly Sklar
McClatchy-Tribune News Service
Sunday 21 October 2007
When it comes to producing billionaires, America is doing great.
Until 2005, multimillionaires could still make the Forbes list of
the 400 richest Americans. In 2006, the Forbes 400 went billionaires
only.
This year, you'd need a Forbes 482 to fit all the billionaires.
A billion dollars is a lot of dough. Queen Elizabeth II, British
monarch for five decades, would have to add $400 million to her $600
million fortune to reach $1 billion. And she'd need another $300
million to reach the Forbes 400 minimum of $1.3 billion. The average
Forbes 400 member has $3.8 billion.
When the Forbes 400 began in 1982, it was dominated by oil and
manufacturing fortunes. Today, says Forbes, "Wall Street is king."
Nearly half the 45 new members, says Forbes, "made their fortunes
in hedge funds and private equity. Money manager John Paulson joins
the list after pocketing more than $1 billion short-selling subprime
credit this summer."
The 25th anniversary of the Forbes 400 isn't party time for
America.
We have a record 482 billionaires - and record foreclosures.
We have a record 482 billionaires - and a record 47 million people
without any health insurance.
Since 2000, we have added 184 billionaires - and 5 million more
people living below the poverty line.
The official poverty threshold for one person was a ridiculously
low $10,294 in 2006. That won't get you two pounds of caviar ($9,800)
and 25 cigars ($730) on the Forbes Cost of Living Extremely Well
Index. The $20,614 family-of-four poverty threshold is lower than the
cost of three months of home flower arrangements ($24,525).
Wealth is being redistributed from poorer to richer.
Between 1983 and 2004, the average wealth of the top 1 percent of
households grew by 78 percent, reports Edward Wolff, professor of
economics at New York University. The bottom 40 percent lost 59
percent.
In 2004, one out of six households had zero or negative net worth.
Nearly one out of three households had less than $10,000 in net worth,
including home equity. That's before the mortgage crisis hit.
In 1982, when the Forbes 400 had just 13 billionaires, the highest
paid CEO made $108 million and the average full-time worker made
$34,199, adjusted for inflation in $2006. Last year, the highest paid
hedge fund manager hauled in $1.7 billion, the highest paid CEO made
$647 million, and the average worker made $34,861, with vanishing
health and pension coverage.
The Forbes 400 is even more of a rich men's club than when it
began. The number of women has dropped from 75 in 1982 to 39 today.
The 400 richest Americans have a conservatively estimated $1.54
trillion in combined wealth. That amount is more than 11 percent of
our $13.8 trillion Gross Domestic Product (GDP) - the total annual
value of goods and services produced by our nation of 303 million
people. In 1982, Forbes 400 wealth measured less than 3 percent of
U.S. GDP.
And the rich, notes Fortune magazine, "give away a smaller share
of their income than the rest of us."
Thanks to mega-tax cuts, the rich can afford more mega-yachts,
accessorized with helicopters and mini-submarines. Meanwhile, the
infrastructure of bridges, levees, mass transit, parks and other
public assets inherited from earlier generations of taxpayers crumbles
from neglect, and the holes in the safety net are growing.
The top 1 percent of households - average income $1.5 million -
will save a collective $79.5 billion on their 2008 taxes, reports
Citizens for Tax Justice. That's more than the combined budgets of the
Transportation Department, Small Business Administration,
Environmental Protection Agency and Consumer Product Safety
Commission.
Tax cuts will save the top 1 percent a projected $715 billion
between 2001 and 2010. And cost us $715 billion in mounting national
debt plus interest.
The children and grandchildren of today's underpaid workers will
pay for the partying of today's plutocrats and their retinue of
lobbyists.
It's time for Congress to roll back tax cuts for the wealthy and
close the loophole letting billionaire hedge fund speculators pay
taxes at a lower rate than their secretaries.
Inequality has roared back to 1920s levels. It was bad for our
nation then. It's bad for our nation now.
.
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