“We can have a democracy in this country or we can have great wealth concentrated in the hands of a few, but we can’t have both.”
US Supreme Court Justice Louis Brandeis (1846 – 1941)
Here’s a couple of short, concise, explanations of our economic crisis:
We’re NOT all in it together–follow the money:
Every area of the economy is still about taking wealth from the great mass of people and putting it into the hands of a few. (Source)
It’s what Kenneth Rogoff calls, “Byzantine labyrinths funneling money to powerful interests“.
Remember the old days when the landlord advanced the money and had first dibs on the harvest? And the harvest was never quiet enough to clear the debt. And so the farmer got poorer and poorer, until he had nothing. Substitute Citibank as the landlord and your own name as the tenant farmer/sharecropper. (Source)
Curious how wealth transfer to the elite is accomplished in practice? These videos explain:
- The Handbook of Human Ownership – A Manual for New Tax Farmers
Does this affect me? Yes:
If you make less than $114,000 a year (90% of us), you’ve been financially damaged by the flow of income to the richest 1% of Americans over the past 30 years. (Source)
Here’s how our global financial system is set up to extract a maximum amount of money from effective farming of the middle class:
- Farming the Middle Class–how to extract maximum dollars
- de Facto Decriminalization of Elite Financial Fraud
- Give ‘em easy credit, when they can’t pay it back, use their default to take WHATEVER you want–bwahahaha, hahahah
All that bailout money has got to go somewhere . . .
Know what I’m sayin’?
It’s a great time to be an oligarch!
. . . just check global income and wealth distributions
Combined net worth: (Source)
The Forbes 400 wealthiest Americans in 2007: $1.5 trillion
The poorest 50% of American households: $1.6 trillion
INCOME: The top 1/5 are paid 82.7% of all global income.
(Source: Conley, 2008):
WEALTH: The top 1/3 own 95.6% of all global wealth:
The same pattern holds in the U.S.:
U.S. Wealth Distribution
Repeat after me:
The richest 1% of Americans control a third of the country’s wealth because they deserve it, and the other 99% of the populace are just a bunch of lazy bastards with their hands out. (Source)
U.S. Income Distribution
Top 1% of wage earners in America earn more than the bottom 48%:
Source: Social Security data
Those in the media and the government always refer to “The Economy” as a monolithic entity in which we all participate. That’s the Great Lie, for there are two economies in the United States, one where the wealthy or well-off live and another where everyone else struggles to survive. (Source)
Regarding these “two economies“:
- As the Middle Class Collapses and the American Poverty Rate Soars, the Economic Elite Have Never Had It Better
- In past 12 years, income for richest 400 Americans quadrupled while their tax rate nearly halved
- Obama Renews Commitment to Complete Destruction of the Middle Class – Meet the New Economic Death Squad
- Nine Pictures Of The Extreme Income/Wealth Gap
- The Economic Crisis–leads to political crisis
Video presentation: Wealth distribution–Walking on Sunshine . . . ?
Bloomberg/Business Week, in an article titled, “It’s a Great Time to Be Rich,” noting that taxes on incomes and investments remain at historic lows and that fortunes can be passed on at the lowest rates in a lifetime, says: (Source)
“If the tax cuts become law, the next two years will be the best in living memory for many wealthy Americans to shield their income and fortunes.” (Source: Bloomberg/Business Week)
Owners, overseers, and workers
The Top 1% in US earn most of their income from owning assets, while the middle and lower classes work at jobs to earn their income.
Gordon Gekko said in the movie Wall Street over 20 years ago: “The richest one percent of this country owns half our country’s wealth, five trillion dollars. . . . We make the rules, pal. The news, war, peace, famine, upheaval, the price per paper clip. . . . It’s not a question of enough, pal. It’s a zero sum game, somebody wins, somebody loses.” The trick is to convince the losers that the winners DESERVE to win.” (Source)
In 1963 Malcolm X clarified the difference between owners, overseers, and workers . . . (see video clip below)
Inquiring minds might ask if Malcom X‘s speech is still relevant today?
Here are some more details:
- Top 1 Percent Control 42 Percent of Financial Wealth in the U.S. – How Average Americans are Lured into Debt Servitude by Promises of Mega Wealth
- Farming the Middle Class–how to extract maximum dollars
- Endless Affirmative Action for the Rich
- The Power To Tax — and the power to issue the currency required to pay that tax
“It’s their own damn fault!”
“It’s systemic exploitation.”
Which is it?
Here’s What Suzi Orman, popular TV financial guru, says:
“My only fear in life, when it comes to money, is what’s happening in the United States of America. The American dream is dead for the majority of America. The middle class has disappeared. We have a highway to poverty and no roads coming out.” (Source)
It’s About Equality of Opportunity, NOT Equality of Outcomes–Isn’t It?
- Children from low-income families have only a 1 percent chance of reaching the top 5 percent of the income distribution, versus children of the rich who have about a 22 percent chance.
- By international standards, the United States has an unusually low level of intergenerational mobility: our parents’ income is highly predictive of our incomes as adults. Intergenerational mobility in the United States is lower than in France, Germany, Sweden, Canada, Finland, Norway and Denmark. Among high-income countries for which comparable estimates are available, only the United Kingdom had a lower rate of mobility than the United States.
Opportunity for economic mobility certainly exists, BUT the odds are stacked against it.
ONLY 3% OF STUDENTS at the top 146 colleges come from families in the bottom income quartile; only 10% come from the bottom half. (Source)
In the United States (and the UK), if your family is poor, you will likely spend the rest of your life poor. If your family is rich, you will likely spend the rest of your life rich. At the same time, a few are able to break through and move up economically–or fall and move down.
Evidence of Systemic Bias
“We can have democracy in this country, or we can have great wealth concentrated in the hands of a few, but we can’t have both.” — Louis Brandeis, former US Supreme Court Justice
Shifting Income Away from the Middle Class
The documented shift of income and wealth away from the many and towards the elite few is evidence of a systemic bias in the economic system in favor of the few. This is the bias that needs to be addressed.
Recent evidence of systemic bias:
- The top 1% get almost 90% of the gains during 2002-2007
While the Top 1% have more than tripled their inflation adjusted incomes from 1970-2009, average workers’ incomes have remained almost unchanged. Average annual US pay over the last 39 years, adjusted for inflation:
- 1970 – $35,283
- 2009 – $40,711
Shifting Wealth Away from the Middle Class–results:
- The bottom 40% of US population owns less than 1% of all US wealth.
- The top 20% of US population owns 84% of all US wealth.
- Source: Michael Norton and Dan Ariely, “Building A Better America–One Wealth Quintile At A Time” (pdf)
- Actual US wealth distribution: shows actual US wealth distribution demographic data.
- Estimated US wealth distribution: shows survey results from asking US citizens to estimate what they think US wealth distribution “actually is”.
- Ideal US wealth distribution: shows survey results from asking US citizens to estimate what they think US wealth distribution “should be”.
Because of their small percentage share of total wealth, both the “4th 20%” value (0.2%) and the “Bottom 20%” value (0.1%) are not visible in the “Actual” distribution.
Your Loss, Their Gain
How much income have you given up for the top 1 percent?
Workers Share of US Income–Falling Rapidly Since 2001
Why are workers taking home such a reduced share of the pie? Clearly there has been a loss in the bargaining power of labor. Meanwhile, U.S. companies have made record profits, while unemployment has stayed high and wages have barely risen.
“Every area of the economy is still about taking wealth from the great mass of people and putting it into the hands of a few.” (Source)
When you choose to live on less, that is “austerity.” When the government forces you to live on less so the bankers can have more, that is “Poverty.” It’s what Kenneth Rogoff calls, “Byzantine labyrinths funneling money to powerful interests“. It is also “Tyranny”, “Fascism”, and “Dictatorship.”
How pervasive is it?
Then consider this:
Remember bonuses? Gone. Raises? Practically gone. Christmas turkey in a box? Gone. (Couldn’t spend even 3$ on their employees as a sign of good faith.) Company picnics, yearly free lunch, gone, gone, gone. Now it’s: Do the work of 4 people, make your quotas by month end so you look good at corporate. Make sure we show a profit, got to pay dividends still! Here, take this new healthcare plan, it’ll be good for you, but don’t read the fine print, we’ll give you a small bonus if you pick this one. Work long hours at salary, fight for every single thing you need to do your job, and worry every day if you don’t work hard enough, you’ll be let go. (Source)
The rich exist in a different world from the one you write about. They live privileged lives in gated communities. Meet for holidays at the world’s elite resorts. The richest just aren’t worried about today’s economy like your readers. Their issues revolve around who’s the best masseuse, best Pilates teacher, best concierge medical doctor, which private school to choose, what investments they are making at this time, etc. Folks at the top are not concerned with the underlying deterioration of America, except in the abstract, because they aren’t directly affected. That’s why no amount of information from you will ever change things. To them, it’s irrelevant. (Source)
Now we’re headed towards global feudalism instead. With the increasing amounts of technology, you are becoming unnecessary for the people that now own everything. Do you want a pay raise? We’ll get someone in China to do your job. Does he want a pay raise? We’ll just head to India. Do you raise your import tariffs to protect your local industry? We’ll send the WTO or some other international institute controlled by a Bilderberger after you and claim that you’re “starting a trade war”. 300 years ago they could not ship your job to another country, now they can. Soon they will have machines doing the job, instead of humans reduced to the status of a machine. Of course they will have the money and the technology to extend their lives pretty much indefinitely. You however will be a diabetic obese and sterile creature. If there is ever the risk of you rebelling*, a virus will magically cross species and you’ll be gone. Don’t worry though, the world they will inherit is not the kind of world that you would want to live in. (Source)
The Paradox of Power
How Power Corrupts — People in a position of authority appear to lose their natural sympathy for others; strange, when it’s often that same sympathy that got them their authority in the first place. This is what’s known as the Paradox of Power
Numerous prominent economists in government and academia have all said that large inequalities can cause – or at least contribute to – financial crises, including authorities such as:
- Robert Shiller, Joseph Stiglitz, John Kenneth Galbraith, Raghuram Rajan, Robert Reich, Mark Thoma, Emmanuel Saez, Thomas Piketty, David Moss, Kemal Dervi, Michael Kumhof, Romain Rancière, Robert Wade, David Ruccio, Marriner S. Eccles
- Want more details? Here’s the book to check out: “The Price of Inequality: How Today’s Divided Society Endangers Our Future” (Summarized here: We’ve been brainwashed:It’s no accident that Americans widely underestimate inequality. The rich prefer it that way)
Dmitri Orlov asks “Are we sliding towards collapse of society, the economy, and pretty much life as we know it?”
Dmitri Orlov’s 5 Steps to Collapse: Stage 1, the financial collapse, well underway. 2, the commercial collapse, just getting started as is 3, the loss of credibility of the political system. What remains are the two end states - 4, social collapse and 5, the full meltdown of cultural collapse. (Source)
Former president of the world bank, James Wolfensohn, addresses graduate students at Stanford University on January 11th, 2010. He tells the graduate students what’s coming–a titanic shift in wealth.
There are so many trees around us that there cannot possibly be a forest here!
1. Federal Budget Deficit Bomb. The Bush/Cheney wars pushed America deep into a debt hole. Federal debt limit was just raised almost 100% with Obama’s 2010 budget, to $14.3 trillion vs. $7.8 trillion in 2005. The Congressional Budget Office predicts future deficits around 4% through 2020. Get it? America’s debt at 84% of GDP will soon pass that toxic 90% trigger point.
2. U.S. Foreign Trade Bomb. Monthly deficits actually dropped from $50 billion per month to roughly $35 billion. But the total continues climbing as $400 billion is added each year. Foreigners now own $2.5 trillion of America, with China holding over $1.3 trillion in Treasury debt.
3. Weakening U.S. Dollar as Foreign Reserve Currency Bomb. Fear China and other currencies will replace dollar as main foreign reserves. The dollar’s fallen: The main index measuring dollar strength has gone from 120 at the Clinton-to-Bush handoff to below 80 today.
4. Cheap Money Bomb: Credit Ratings Down, Rates Up. Economists at S&P, Fitch and Moody’s were totally co-conspirators of Fat Cat Bankers, misleading investors before meltdown: Soon, debt up, ratings down, interest rates soar.
5. Global Real Estate Bomb. Dubai Tower, new “world’s tallest building” is empty. BusinessWeek warns that China’s housing collapse could be worse than America’s. Plus the U.S. commercial real estate bubble is now $1.7 trillion, a “ticking time bomb” bloating 25% of bank balance sheets.
6. Peak Oil and the Population Bomb. China and India each need 500 new cities. The United Nations estimates world population exploding 50% from 6 billion to 9 billion by 2050: Three billion more humans demanding more automobiles, exhausting more resources to feed their version of the gas-guzzling “America Dream.”
7. Social Security Bomb. We have no choice; eventually we must either cut benefits or raise taxes. Politicians hate both, so they’ll do nothing. Delays worsen solutions. Without action, by 2035 Social Security and Medicare benefits will eat up the entire federal budget other than defense.
8. Medicare: A Nuclear Bomb. Going broke faster than Social Security. Prescription drug benefit added an unfunded $8.1 trillion. In 5 years estimates rose from about $35 trillion to over $60 trillion now.
9. Health-care Insurance Bomb. Burden increasingly shifted to employees. Costs rising faster than inflation. Recent Obamacare plan would have cost $90 billion annually, paid to Big Pharma and insurers.
10. State and Local Government Budget Bombs. Deficits of $110 billion in 2010, $178 billion in 2011on top of more that $450 billion in underfunded state and municipal employee pension funds.
11. Underfunded Corporate Pensions Bomb. From $60 billion surplus in 2007 to $409 billion deficit in 2009. And a whopping 92% of the pension plans of companies are now underfunded. Defaults are guaranteed by taxpayers.
12. Consumer Debt Bomb. Americans are still living beyond their means. Even with a downturn, consumer debt rose from about $2.3 to $2.5 trillion. Fat Cat Bankers love it — yes love making matters worse by gouging cardholders and mortgagees, blocking help in foreclosures and bankruptcies.
13. Personal Savings Bomb. Before the 2008 meltdown savings rate dropped from about 10% in the early 1980s to below zero. Now it’s increasing, slowing retail recovery. Today, government’s the big “unsaver.”
14. War and Military Defense Deficits. Costs of Iraq and Afghanistan wars — $200+ billion annually, $3 trillion minimum, with massive long-term costs for veteran medical care, equipment renewal, recruitment.
15. Homeland Insecurity Bomb. Security at airports, seaports, borders, vulnerable chemical plants all increase budgets.
16. Fed/Treasury Bailout Bombs. Tax credits, loans, cash and purchase of toxic assets from Wall Street banks estimated at $23.7 trillion as new debt was shifted from too-big-to-fail Fat-Cat banks to taxpayers.
17. Insatiable Washington Lobbyists Bombs. Paulson, Goldman, Geithner, Morgan and Wall Street banks, through their lobbyists and former employees working inside now have absolute power over government spending. Democracy and voters are now irrelevant in America’s new corporate-socialism.
18. Shadow Banking: The Derivatives Bomb. Wall Street wants no regulation of this $670 trillion, high-risk, out-of-control casino that’s highly leveraged versus the $50 trillion total GDP of all nations. We forget that derivatives almost destroyed global economies in 2008-09, finally will by 2012.
19. Dysfunctional Two-Party Political Bomb. Polarized partisanship increasing: Every day both parties show zero interest in cooperating for the public good. Instead they fight viciously, resisting everything and anything proposed by opponents. Only goal: Score political points, make the other side look bad.
20. The Coming Populous Rebellion Bombs. Nobody trusts anyone in authority. For good reason. So immediate gratification, short-term betting and a lack of long-term perspective wins for individual investors, consumers and taxpayers as well as Washington, Wall Street and Corporate America CEOs. Today: “Doing what’s right for the common good and country” is just empty political rhetoric.
Investors cannot see bubbles from inside their bubble. . . Why? The optimist’s brain filters out bad news. . . Then, when they finally do see that the proverbial light at the end of the tunnel is an oncoming train, it’s always too late. I will say it again, gently: A new meltdown is coming. The Great Depression II is coming, soon. – Paul B. Farrell, MarketWatch, Feb. 2, 2010
One commentator’s proposal:
Venturing out into the surging waves of expanding consciousness, or retreating into the comfort zone . . .
“Many people don’t understand our country’s problem of concentration of income and wealth because they don’t see it. People just don’t understand how much wealth there is at the top now. The wealth at the top is so extreme that it is beyond most people’s ability to comprehend. If people understood just how concentrated wealth has become in our country and the effect it has on our politics, our democracy and our people, they would demand our politicians do something about it.” (Source)
Nothing in the world is more dangerous than a sincere ignorance and conscientious stupidity. – Martin Luther King, Jr.
Most of one’s life is one prolonged effort to prevent oneself from thinking. . . . Most ignorance is vincible ignorance. We don’t know because we don’t want to know. – Aldous Huxley
The elephant in the room. Pay no attention.
Those who know the least obey the best. — George Farquhar
Most people do not have the courage to call it like it is. They want some kind of workable compromise that leaves them off the hook for the licks taken when it comes to recognizing and pointing out the hard truths that call down the wrath and marginalization that comes with stating that the emperor is naked. . . The truth is a dangerous area of endeavor. You never know what you’re going to find out and it changes you. (Source)
There’s Even Legal Basis for Our
Enslavement Debt Slavery
REPORTER: What is the proper relationship… what should be the proper relationship between a chairman of the Fed and a president of the United States?GREENSPAN: Well, first of all, the Federal Reserve is an independent agency. And that means basically that, uh, there is no other agency of government which can overrule actions that we take. So long as that is in place, and there is no evidence that the administration, the Congress or anybody else is requesting that we do things other than what we think is the appropriate thing, then what the relationships are don’t frankly matter.
Give me control of a nation’s money and I care not who makes it’s laws. – International Banker, Mayer Amschel Bauer Rothschild
Guess who controls our nation . . .
A great industrial nation is controlled by its system of credit. – President Woodrow Wilson – In The New Freedom (1913)
Duh, you mean it’s the bankers who control our great nation?
Or, as Dick Durbin, US Senator, speaking about Congress, puts it:
How could it be any more clear?
- Breakdown of the $26 Trillion the Federal Reserve Handed Out to Save Incompetent, but Rich Investors
- Who Owns Congress?–the usual depressing facts, same as last year, and the year before . . .
- Instituting Widespread Debt Slavery–debt is not just a credit instrument, it is an instrument of political and economic control
- The Handbook of Human Ownership – A Manual for New Tax Farmers
- The Story of Your Enslavement
- FINANCIAL TYRANNY: Defeating the Greatest Cover-Up of All Time
The Party imposed itself most successfully on people incapable of understanding it. They could be made to accept the most flagrant violations of reality, because they never fully grasped the enormity of what was demanded of them, and were not sufficiently interested in public events to notice what was happening. – George Orwell, 1984
We don’t even know what the natural state is anymore. Our world is being gang banged by the most vicious and predatory among us, with the conscious and unconscious assistance of the majority of the population. (Source)
If all land is owned by the state, and the state is controlled by the private corporations, then the private corporations have unlimited no cost access to all natural resources for their taking without paying. (Source)
Accurate prophecies are no guarantee of positive intent. (Source)
Since there has never been any time but now, now must be the time. (Source)
- How economic inequality is damaging our social structure (psychologytoday.com)
- Income distribution: Emmanuel Saez (PDF)
- The Globalization of Poverty and the New World Order
- Net worth: Edward Wolff (PDF)
- Household income/income share: Congressional Budget Office
- Real vs. desired distribution of wealth: Michael I. Norton and Dan Ariely (PDF)
- Net worth of Americans vs. Congress: Federal Reserve (average); Center for Responsive Politics (Congress)
- Your chances of being a millionaire: Calculation based on data from Wolff (PDF); US Census (household and population data)
- Member of Congress’ chances: Center for Responsive Politics
- Wealthiest members of Congress: Center for Responsive Politics
- Tax cut votes: New York Times (Senate; House)
- Wall street profits, 2007-2009: New York State Comptroller (PDF)
- Unemployment rate, 2007-2009: Bureau of Labor Statistics
- Home equity, 2007-2009: Federal Reserve, Flow of Funds data, 1995-2004 and 2005-2009 (PDFs)
- CEO vs. worker pay: Economic Policy Institute
- Historic tax rates: Calculations based on data from The Tax Foundation
- Federal tax revenue: Joint Committee on Taxation (PDF)
- How the rich get richer
- How the poor get poorer
- Who owns Congress?
- The Trickle-Up Economy
This page has the following sub pages.
- Universities in Crisis
- Babyboomers’ Legacy — thanks for nothing
- U.S.-World Finance Crisis Explained–by Benjamin Fulford
- Low Quality Education
- Farming the Middle Class–how to extract maximum dollars
- Real Estate Markets in Crisis
- The International Bankers–famous quotes about international bankers
- The Great Risk Shift–Jacob S. Hacker
- History of the Money Changers
- Cold Blooded Banksters–as explained by one
- Stunning Crimes of the Big Banks–worse than your wildest imagination