Does the Future Belong to People Who Profit Off Our ‘Extreme Wealth Disorder’?

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The University of California’s inequality stats team has now trimmed the data lag time even further, to help us “track the distributional impacts of government policies” on a month-to-month basis and provide critically important information to have in the middle of an economic crisis.

The Berkeley team notes that none of the timely government economic stats we’ve had up to now — on total national personal income, unemployment, and more — have come “disaggregated by income level.” Without that disaggregation, we can’t know what social groups are benefiting from current government policies and what groups aren’t. And if we don’t have that information, then government programs successfully helping people who really need help can fall politically by the wayside.

The Berkeley analysts illustrate that dynamic by applying their new “real-time inequality” statistical methodology to our Covid pandemic years. At the end of 2021, their approach shows, America’s working-class households found themselves with 20 percent more disposable income than before the pandemic, thanks to the federal government’s expanded child tax credit and expanded earned income tax credit for adults with children.

But disposable income for the nation’s working families promptly then fell in early 2022 after Congress let those aid programs expire. By June 2022, the Berkeley economists sum up, the wealth share of America’s top 0.1 percent had returned “to its pre-Covid level.”

So what do we do with all the new distributional data we now have available? Do we gaze at the new numbers and marvel at how incredibly rich our rich continue to be? Or do we battle to create a much more equal society where helping the wealthy manage their money no longer rates as our nation’s hottest career option?

A host of long-time egalitarian activists are choosing the latter. They’ve just come together to establish an Excessive Wealth Disorder Institute, and this new Institute, as its first order of business, is now teaming up with social justice advocacy groups and coalitions in a “Tax the Ultra-Rich Now” campaign to “TURN” America around.

TURN campaign activists will be initially “collaborating with grassroots organizations across five key states – Georgia, North Carolina, Nevada, Pennsylvania, and Wisconsin – with a focus on organizations centered in communities of color.”

Other campaigns will no doubt follow, on a wide variety of fronts. Those campaigns will have no shortage of tax-the-rich proposals to draw from. Among the latest, from Bob Lord and Dylan Dusseault of Patriotic Millionaires, a call for the passage of an “Oppose Limitless Inequality Growth and Restore Civil Harmony Act.” This “OLIGARCH” legislation would key new taxes on the wealth of America’s super rich to the nation’s median — most typical — household wealth.

Under the OLIGARCH Act, households holding between 1,000 and 10,000 times America’s median household wealth would pay an annual 2 percent tax on their fortunes. Those rates would escalate on households sitting on even greater stores of wealth. In the top tax bracket, for households worth over one million times our most typical household wealth, the annual tax would run at 8 percent.

Back in 1980, Lord and Dusseault note, fewer than 0.005 percent of America’s adults held over 1,000 times the nation’s median household wealth. By 2020, the ranks of that wealth cohort had quintupled. In 1983, not a single American held a fortune that equaled 100,000 times the nation’s median household wealth. In 2021, slightly over 50 Americans exceeded that threshold, and two Americans actually held over a million times the wealth of America’s most typical households.

That can all change. We all can change it.

Sam Pizzigati co-edits Inequality.org. His latest books include The Case for a Maximum Wage and The Rich Don’t Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class, 1900-1970. Twitter: @Too_Much_Online.