- David Dayen discusses the massive corporate tax giveaways handed out through the U.S.' annual budget process. And in a system where lobbying by the wealthy is rewarded with a 24-to-1 return, it shouldn't be much surprise if inequality is getting even worse than previously assumed, as Jordan Weissmann reports:
Forget the 1 percent. The winners of this race, according to Zucman and Saez, have been the 0.1 percent. Since the 1960s, the richest one-thousandth of U.S. households, with a minimum net worth today above $20 million, have more than doubled their share of U.S. wealth, from around 10 percent to more than 20 percent. Take a moment to process that. One-thousandth of the country owns one-fifth of the wealth. By comparison, the entire top 1 percent of households takes in about 22 percent of U.S. income, counting capital gains.- At the same time, Alan Pyke highlights the lack of a link between education and income, noting that nearly half a million American workers with post-secondary degrees are earning the minimum wage. And Tyler Cowen takes a look at the roots of structural unemployment.
This new batch of research is similar in spirit to Saez’s pioneering work quantifying income inequality, which he has published with French economist Thomas Piketty. (It's probably no accident that this research is coming out around the same time that Piketty, Saez's longtime collaborator, has published Capital in the Twenty-First Century, his highly touted book about capital accumulation—aka wealth.) Both projects substitute tax data analysis for older approaches that relied on government surveys, which tend to undercount the very rich. In this case, Saez and Zucman use taxes on investment income to reverse-engineer their wealth estimates. The results are still very preliminary and could change with further study.
But they are basically in keeping with what has already been shown about income inequality. Occupy Wall Street trained Americans to frame the economic gap in terms of the 99 percent and 1 percent. But writers and economists have been pointing out for years that the biggest winners in today’s globalized, finance-heavy economy have been an even smaller band of super-rich. Tim Noah dubbed them “the stinking rich.” Chrystia Freeland went with “plutocrats.” No matter what you choose to name them, the largest economic gains have accrued to Americans at the very, very tiniest tip of the earnings pyramid.
- Bill McKibben comments on ExxonMobil's arrogant response to the increased threat of climate change. And Andrew Jackson points out the IMF's conclusion that tar sands expansion (along with other oil and gas development) doesn't figure to actually add much to Canada's economy - even under a government determined to push resource development ahead of all other social and economic priorities.
- Scott Tribe self-identifies as a voter who may be disenfranchised by the Cons' Unfair Elections Act. And Karl Nerenberg tears into some of the most blatant dishonesty being used by the Cons to push an attack on voting rights and electoral fairness alike.
- Finally, Daniel Kahneman discusses how to ferret out and adjust for some of the errors that tend to show up in typical reporting.