26.2.08

Deregulation, Privatization and Wealth Worship

On 16 July 2009, Don Monkerud opined thus in The Capital Times:

“During eight years of the Bush administration, THE 400 RICHEST AMERICANS, WHO NOW OWN MORE THAN THE BOTTOM 150 MILLION AMERICANS, INCREASED THEIR NET WORTH BY $700 BILLION. In 2005, THE TOP 1 PERCENT CLAIMED 22 PERCENT OF THE NATIONAL INCOME, WHILE THE TOP 10 PERCENT TOOK HALF OF THE TOTAL INCOME, THE LARGEST SHARE SINCE 1928...

CORPORATIONS SYSTEMATICALLY CREATED A WEALTH GAP OVER THE LAST 30 YEARS. In 1955, IRS records indicated the 400 richest people in the country were worth an average $12.6 million, adjusted for inflation. IN 2006, THE 400 RICHEST INCREASED THEIR AVERAGE TO $263 MILLION, REPRESENTING AN EPOCHAL SHIFT OF WEALTH UPWARD IN THE U.S.

In 1955, the richest tier paid an average 51.2 percent of their income in taxes under a progressive federal income tax that included loopholes. BY 2006, THE RICHEST PAID ONLY 17.2 PERCENT OF THEIR INCOME IN TAXES. In 1955, the proportion of federal income from corporate taxes was 33 percent; BY 2003, IT DECREASED TO 7.4 PERCENT. TODAY, THE TOP TAXPAYERS PAY THE SAME PERCENTAGE OF THEIR INCOMES IN TAXES AS THOSE MAKING $50,000 TO $75,000, ALTHOUGH THEY DOUBLED THEIR SHARE OF TOTAL U.S. INCOME.

‘Over the past 30 years, the income of the top 1 percent, adjusted for inflation, doubled: the top one-tenth of 1 percent tripled, and the top one-one-hundredth quadrupled,’ says (Sam) Pizzigati. ‘Meanwhile, the average income of the bottom 90 percent has gone down slightly. This is a stunning transformation.’

Meanwhile, wages for most Americans didn't improve from 1979 to 1998, and the median male wage in 2000 was below the 1979 level, DESPITE PRODUCTIVITY INCREASES OF 44.5 PERCENT. Between 2002 and 2004, inflation-adjusted median household income declined $1,669 a year. TO MAKE UP FOR LOST INCOME, CREDIT CARD DEBT SOARED 315 PER CENT between 1989 and 2006...

According to Pizzigati, THE WEALTH DISPARITY IS THE RESULT OF CORPORATIONS SQUEEZING MORE PROFITS FROM WORKERS.

‘In the past corporations laid off workers because business was bad,’ Pizzigati says. ‘But OVER THE PAST FEW DECADES, DOWNSIZING HAS BEEN A CORPORATE WEALTH GENERATING STRATEGY. TODAY, CEOS DON'T SPEND THEIR TIME TRYING TO MAKE BETTER PRODUCTS: THEY MANEUVER TO TAKE OVER OTHER COMPANIES, STEAL THEIR CUSTOMERS AND FIRE THEIR WORKERS...

REAGAN... CUT THE TOP INCOME TAX RATES, AND SAW THE CREATION OF RIGHT-WING THINK TANKS THAT SPENT $30 BILLION OVER THE PAST 30 YEARS PROPAGANDIZING FOR DEREGULATION, PRIVATIZATION AND WEALTH WORSHIP…

‘There won't be a restructuring of the economy UNLESS WE TAKE ON EXECUTIVE COMPENSATION,' concludes Pizzigati.

‘OUTRAGEOUSLY LARGE REWARDS GIVE EXECUTIVES AN INCENTIVE TO BEHAVE OUTRAGEOUSLY. IF WE ALLOW THESE INCENTIVES TO CONTINUE, WE WILL JUST SEE MORE OF THE RECKLESS BEHAVIOR THAT HAS DRIVEN THE GLOBAL ECONOMY INTO THE DITCH’.”

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