As the "rent-seeking" behavior of the financial industry extracts ever more massive amounts of wealth from society, the working class has not been properly compensated for its rising productivity. As a result, our median inflation-adjusted household wealth has dropped from $73,000 to $57,000 in a little over 25 years. We've lost another 5% of our wealth just since the beginning of the recession.
Correspondingly, the poverty rate (among the poorest half of those who live beneath the poverty line) continues to grow in the USA, even as worker productivity continues to climb. In fact, the percentage of US homes spending less than the World Bank's poverty threshold of $2 per person per day has doubled since 1996! Our poverty rate is 3-times that of Finland, our incarceration rate 7-times that of Holland.
Read more here.
Where Has All That Money Gone, That Has Been Stolen From Us?
As Thom Hartman has recently reported, by funneling money into and out of various trusts and other legal structures, the wealthy have managed to eliminate taxes on money they pass down to their heirs, and even make a tax-free profit while doing so. Basically, billionaires like Shelly Adelson and the Walton family set up special trust funds, like the Walton-created "grantor-retained annuity trust" or GRAT, in which they stash millions of dollars-worth of stock. Once those GRATs expire -- typically after two years -- the billionaires cash out the stock, keep their original investment, along with a profit, and pass on the balance to their heirs, all the while avoiding taxes on the whole scheme.
By using these completely legal, but highly unethical, tactics, the super wealthy have stashed away $100 billion in a little over a decade. That amount is enough to pay for every child in our nation to go to preschool for ten years, and it could wipe out the entire first round of sequester cuts. One hundred billion could have provided a substantial benefit to our nation, and it's only one of many tax loopholes that the super-rich use to get out of paying their fair share.
Republicans and the super-rich like to call estate taxes "death taxes," but, as this new report shows, it's trust-fund schemes like this that are actually killing investment in our nation.
If billionaires want to do business in our great nation, it's about time they start contributing their fair share to the commons that make it possible.
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