Notes, Judson’s book

13 Mar

 

Notes

“It can happen here”, Bruce Judson, Yale School of Mgmt.

In progressive societies the concentration may reach a point where the strength in numbers of the many poor rivals the strength in ability of the few rich; then the unstable equilibrium generates a critical situation, which history has diversely met by legislation redistributing wealth or by revolution redistributing poverty.

The Durants: “The government of the United States, in 1933-52 and 1960-65, followed Solon’s peaceful methods, and accomplished a moderate and pacifying redistribution”. The New Deal and the Great Society.

“We conclude that the concentration of wealth is natural and inevitable and is periodically alleviated by violent or peaceable partial redistribution.”

Economic inequality, revolutions, and economic shocks.

The result is that an economic crisis is frequently the catalyst that pushes a vulnerable political system over the edge from instability to revolution.

Extreme economic inequality has been building in the US for over 30 years.

And those who have power, wealth, and influence are rarely interested in losing those advantages.

Revolutions often start with reforms.

The distribution of wealth and the health of the middle class, the impact of recent economic or political shocks, the lack of satisfaction of rising expectations, the perception of unfairness in the distribution of wealth, the history and efficacy of institutions in society.

The wealthy develop a sense of entitlement, and they increasingly seek to insulate themselves from the rest of society. They use their wealth to obtain political influence that solidifies their privileges.

A vibrant and large middle class is essential.

“Where democracies have no middle class, and the poor are greatly superior in number, trouble ensues and they are speedily ruined.” Aristotle

“It is the poor who have wanted to rob the rich or the rich who have tried to put the poor in chains.” de Tocqueville

Revolutions occur, or do not occur, because people believe in something. *Mobility in the US is actually lower than mobility in almost all European countries and Canada, despite the abiding myth of Horatio Alger.

The top earning 10 percent of US families receive 49.3 percent of all US household income, including capital gains. The top 10 percent received a 34.2 of the nation’s income 30 years ago.

The bulk of the explosion of inequality has occurred in the past 30 years.

In 1979, the top 1 percent of Americans received 10 percent.

By 2006, it had reached 22.8 percent.

Ucal Berkeley, Economics dept.

*A young male has an income, adj for inflation, that is 12 percent less than his father 30 years ago. My note: “Stagnation.”

America’s class structure is headed in the direction of Brazil’s and Mexico’s.*

Inequality peaked 1928-9, descending from 1950’s -79.

The top 1 percent of all households received 18 percent of the nation’s income in 1913.

This total peaked at 23.9 percent in 1928.

Declined to 11.3 percent in 1944.

In 1976,  it was 8.9 percent.

Then by 1979, the top 1 percent had increased to over 22.8 percent. Note: Reagan reversed this trend.

The driving factor is the top 1 percent.

We have become an economic oligopoly.

Unchecked and rising economic inequality is an indicator of a dysfunctional democracy that is spiraling downward.

“The American dream in reverse”. Obama

The American dream is essentially a middle class dream.

The majority of working Americans have been waiting for a raise for over 30 years.

In 2006, the top 10 percent of US households received incomes of over $104,400 or greater.

This top group accounted for just below 49.3 percent of the nation’s total income.

By 1944, the percent of total income held declined to 33 percent until the 70’s.

The total income in the 70’s received by the top 10 percent reached 49.3 percent.

Presently, 10 percent receives almost 50 percent of the nation’s income.

The top one percent , household income of $376,000, received almost 22.8 percent of all income.

Before the stock market crash of 1929, the top 1 percent of Americans received almost 24 percent of all income. From 1952 to 75, the top 1 percent received between 9 to11 percent of total hh income.

The richest tenth of one percent earned $1.91 million or more.

Median real income increased from a real income of 43,937 to 49,568 $$.

13 percent gain in 28 years.

Note: In other words, they LOST money.

This doesn’t include social security.

1979 was the turning point. note: The bastards elected Reagan.

The golden age of equality in America was engineered through a combination of tax policies and social benefits.  Note: Social engineering by the Democrats.

Economic growth and productivity gains have gone to the rich.

The task force on inequality and American Democracy, reports the growing concentration of the nation’s wealth in the hands of the few.

Source: NYU

The top 20 percent own almost 85 percent of the nation’s wealth.

80 percent are fighting over 15 percent! America’s ‘banana-republic like wealth distribution’.

The Gini coefficient.

0 equals perfect equality.

1 absolute inequality

The US has a gini at .463

The US has the highest inequality rate with the exception of Mexico and Turkey

On the per capita GDP scale, our neighbors are Sweden, Swiss, and UK; on the Gini scale, Sri Lanka, Mali and Russia.

My note: The Cold War and Reagan-Bush-Bush II effectively bankrupted the US.

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