Some profitable companies pay nothing. Others get large rebates. They benefit from tax laws they write. Ordinary Americans bear greater than ever burdens. The worst is yet to come.
Californians did the unthinkable. Last November, they backed a ballot initiative to raise taxes. Ordinary people pay it. Rich ones and corporations game the system to avoid it. Tax laws make it easy to do.
Social inequality in America is unprecedented or close to it. It matches or exceeds 19th century harshness. Protracted Depression conditions affect Main Street.
Poverty, unemployment, homelessness and hunger approach record levels. Millions struggle to get by. Credit cards are maxed out to do it. Retirement savings are tapped.
They're used to pay bills or get loans. Vanguard is one of the largest 401(k) money managers. It said households using either method rose 12% since 2008.
HelloWallet offers Americans "institutionalized financial advice." It said 30% of households earning less than $50,000 annually used one method or the other.
Aon Hewitt surveyed 110 large employers. Nearly one-third of their employees had outstanding loan balances against retirement accounts. Nearly 7% had hardship withdrawals. About 42% cashed in plans when changing jobs. Doing so harms retirement security.
Last November, the Center on Budget and Policy Priorities published a report titled " Pulling Apart ." It discussed growing US income inequality.
It said growth "since the late 1970s has not been a geographically isolated phenomenon."
"Nationwide, income gaps between the richest households (as well as) poorest (and) middle-income (ones) widened significantly since the late 1970s."
"The incomes of the country's richest households climbed substantially over the past three decades, but middle and lower income households have seen only modest increases or actual declines after adjusting for inflation."
Realized capital gains were excluded. Study authors warned its "results show somewhat less inequality than would be the case" by including them.
Findings were bad enough. "Nationally, the richest fifth of households enjoyed larger average income gains in dollar terms each year ($2,550 inflation-adjusted) than the poorest fifth experienced during the entire (previous) three decades ($1,330)."- Advertisement -
In the late 1970s, the America's richest fifth households had 5.2 times as much income as the poorest one-fifth. By the mid-2000s, it was 8.3 times. Disparity rises annually. It may now exceed 10 times. In another decade or less it could double today's level.
Socially destructive government policies bear full responsibility. Wealth and privilege alone matter. Ordinary households are sacrificed. Popular needs go begging.