market spawns efficiency, and efficiency means the elimination of waste. Waste is
pollution, so in a true free-market economy you would eliminate, as nearly as you
can, pollution. In a true free-market economy you can't make yourself rich without
making your neighbors rich and without enriching your community. Polluters make
themselves rich by making everybody else poor. They raise standards of living for
themselves by lowering the quality of life for everybody else, and they do that by
escaping the discipline of the free market and forcing the public to pay their
production cost. You show me a polluter, I'll show you a subsidy. Corporations are
externalizing machines; they are constantly trying to figure out a way to avoid their
own costs and foist it out on the public." -- RFK Jr.
--------------------------------------------------------------------------------
Billionaires R Us
By Chuck Collins and Felice Yeskel, AlterNet
Posted on October 24, 2005, Printed on October 24, 2005
Fall is inequality season. Every autumn, as the leaves change color, we get a vivid
new picture of the trends that pull us apart as a country.
This year is no different. But after almost three decades of incrementally widening
disparities of wealth and income, it's worth noting that we've entered a new
version of economic apartheid, American-style. Let's call it Inequality 2.0.
The United States is now the third most unequal industrialized society after Russia
and Mexico. This is not a club we want to be part of. Russia is a recovering
kleptocracy, with a post-Soviet oligarchy enriched by looting. And Mexico, despite
joining the rich-nations club of the Organization for Economic and Community
Development, has some of the most glaring poverty in the hemisphere.
In 2004, after three years of economic recovery, the U.S. Census reports that
poverty continues to grow, while the real median income for full-time workers has
declined. Since 2001, when the economy hit bottom, the ranks of our nation's
poor have grown by 4 million, and the number of people without health insurance
has swelled by 4.6 million to over 45 million.
Income inequality is now near all-time highs, with over 50 percent of 2004 income
going to the top fifth of households, and the biggest gains going to the top 5
percent and 1 percent of households. The average CEO now takes home a
paycheck 431 times that of their average worker.
At the pinnacle of U.S. wealth, 2004 saw a dramatic increase in the number of
billionaires. According to Forbes Magazine, there are now 374 U.S. billionaires. The
growth in billionaires took a dramatic leap since the early 1980s, when the average
net worth of the individuals on the Forbes 400 list was $400 million. Today, the
average net worth is $2.8 billion. Wal-Mart's Walton family now has 771,287 times
more than the median U.S. household.
Does inequality matter? One problem is that concentrations of wealth and power
pose a danger to our democratic system. The corruption of politics by big money
might explain why for the last five years the President and Congress have been
more interested in repealing the federal estate tax, paid only by multi-millionaires,
than on reinforcing levees along the Gulf Coast.
Now, to pay for hurricane reconstruction and the war in Iraq, Congress is
considering cuts in programs that help poor people, such as Medicaid and Food
Stamps. They have not yet considered fairer ways of reducing the deficit by
reversing special tax breaks for the rich, such as the recent cuts in capital gains
and dividend taxes.
Inequality is non-partisan. The pace of inequality has grown steadily over three
decades, under both Republican and Democratic administrations and Congresses.
The Gini index, the global measure of inequality, grew as quickly under President
Clinton as it has under President George W. Bush. Widening disparities in the U.S.
are the result of three decades of bi-partisan public policies that have tilted the
rules of the economy to the benefit of major corporations and large asset owners
at the expense of people whose security comes from a paycheck.
Public policies in trade, taxes, wages and social spending can make a difference in
mitigating national and global trends toward prolonged inequality. But our priorities
are moving in the wrong direction.
For example, the failure to raise the minimum wage from its 1997 level of $5.15 an
hour guarantees continued income stagnation for the working poor for years to
come. The President and Congress's focus on tax cuts for the wealthy and their
disinterest in government spending to expand equal opportunity sets the stage for
Inequality Version 3.0.
We shouldn't tolerate this drift toward an economic apartheid society.
Chuck Collins and Felice Yeskel are co-authors of the new book, "Economic
Apartheid in America: A Primer on Economic Inequality and Insecurity" (The New
Press).
© 2005 Independent Media Institute. All rights reserved.
View this story online at: http://www.alternet.org/story/27168/
