Friday Morning Links

Assorted content to end your week.

- Robert Reich discusses the rise of the non-working rich as an indicator that extreme wealth has less and less to do with merit - as well as the simple policy steps which can reverse the trend:

In reality, most of America’s poor work hard, often in two or more jobs.

The real non-workers are the wealthy who inherit their fortunes. And their ranks are growing.

In fact, we’re on the cusp of the largest inter-generational wealth transfer in history.

The wealth is coming from those who over the last three decades earned huge amounts on Wall Street, in corporate boardrooms, or as high-tech entrepreneurs.

It’s going to their children, who did nothing except be born into the right family.
...
What to do? First, restore the estate tax in full.

Second, eliminate the “stepped-up-basis on death” rule. This obscure tax provision allows heirs to avoid paying capital gains taxes on the increased value of assets accumulated during the life of the deceased. Such untaxed gains account for more than half of the value of estates worth more than $100 million, according to the Center on Budget and Policy Priorities.

Third, institute a wealth tax. We already have an annual wealth tax on homes, the major asset of the middle class. It’s called the property tax. Why not a small annual tax on the value of stocks and bonds, the major assets of the wealthy?

We don’t have to sit by and watch our meritocracy be replaced by a permanent aristocracy, and our democracy be undermined by dynastic wealth. We can and must take action — before it’s too late.

- Meanwhile, Tim Stacey offers his own prescriptions to deal with income inequality. And the Economist looks at the relationship between wealth inequality, income inequality and consumption inequality - and the fact that all three are on the rise, refuting the claim that we shouldn't worry about wealth or income as long as consumer goods are distributed more fairly. 

- James Bloodworth points out that the few gains we've made against corporate greed were won by a strong labour movement. Brian Jones discusses the stagnation of the minimum wage in recent decades when labour has been under attack. And the Mowat Centre reminds us that the precarious federal government has siphoned tens of billions of dollars in EI premiums into general revenues - turning a program intended to benefit workers when they need help most into an excuse to slash taxes for the wealthy.

- Claire Markham sees a U.S. Congressional hearing as a prime example of how not to listen to people living in poverty. (Though not listening to the poor seems to be a widely-held skill on the right.) And Robin Whitaker reminds us why charity isn't enough to deal with social exclusion.

- Finally, Rick Salutin is right to decry the place of bond ratings agencies in trying to wrest control over public policy away from democratically-elected governments. But surely the subprime meltdown in which so many AAA-rated securities turned out to be junk should prevent us from believing for a second that "their sole criterion is the math" - meaning there's reason to doubt that statements about public budgets have anything to do with actual default risks rather than appealing to the financial sector's prejudices.