Saturday, July 3, 2010

Someone really really rich gets it.

The great depression was ended by a class traitor. Franklin Delano Roosevelt came from one of the richest families in America. But, he caught polio as a youngish adult and couldn't walk. He could, however, drive. He drove everywhere, zigzagging across
America. He'd stop his car and talk to people on the road, just average citizens, and somehow learned what it was like to not live in the bubble of wealth. When he became president, he was not beholden to his family or his (extremely upper) class. Taxes on the rich went way up, laws to protect the poor were enacted.

We're back to the same class structure as existed just barely before the great depression--a huge amount of the wealth in the country is in the hands of just a tiny handful of people.

Here's how one person describes the inequality:

If we divide the wealth of the US into thirds, we find that the top one percent own a third, the next nine percent own another third, and the bottom ninety percent claim the rest. (Actually, these percentages, true a decade ago, are now out of date. The top one percent are now estimated to own between forty and fifty percent of the nation's wealth, more than the combined wealth of the bottom 95%.)

When half the wealth of the entire country is concentrated in a tiny percentage of the population it impoverishes the other 99%. One percent of the population simply cannot go out to dinner often enough to support restaurants, cannot go to the theatre enough to support the arts, cannot buy enough clothes to support clothing stores, and so on. The engine of our economy is the middle class. We know what happens when the middle class doesn't have enough money to spend because it's being hogged by a tiny handful of people, because it has happened before: it was called the Great Depression. Currently, the distribution of money betwixt and between the rich and poor is just about the same as it was in 1929. How fun.

Andy Grove, one of the founders of Intel and a genuine rich person understands the quandry we're in. Read about it here. I doubt that he'll run for public office, however.


Quimbob said...

People can't afford to start businesses that could result in real innovation, either.
You might like FDR's VP & SOA, Henry Wallace.

djinn said...

Right, Quimbob. Because in spite of the gazillions of dollars we (the American people) gave to the banks with no concessions on their part, the banks spent that money on acquiring other banks, making bets in the various derivative markets, etc., anything but lending to US citizens.

Compare this with China, when they bailed out some banks, the Chinese gov't strongarmed the banks into making loans to average citizens.

What is our problem?