Monday, January 27, 2020

POLL - 20% SAY U.S. ECONOMY GOOD UNDER TRUMP - 80% SAY THEY'VE BEEN FUCKED UNDER TRUMPERNOMICS FOR THE RICH AND WALL STREET




Poll: 20 Percent Say U.S. Economy is ‘Excellent’ Under Trump, 3 Percent at End of Obama Administration

Trump
Getty Images/Chip Somodevilla
4:54

A Fox News poll shows that the 20 percent of Americans who rated the United States economy as excellent is up 17 percent from what it was during the last month of the Obama administration (December 2016) when only three percent gave it that rating.
And that 20 percent is up from 14 percent in October, despite the Democrats ongoing impeachment effort against President Donald Trump.
Moreover, the poll shows that 55 percent of American voters give the economy the highest rating in almost 20 years and they believe Trump is responsible for it.
The last time the poll found a higher percentage of those who rated the economy as excellent or good was in January 2001, when 59 percent gave it that rating.
Fox News reported on its poll, which was released on Sunday:
When asked to say who or what they think is most responsible for the current economy, without the aid of a list, the top answer is Trump and Republicans (42 percent). Next, mentioned by far fewer, is former President Obama and Democrats (9 percent) and big business (7 percent).
Among just those with positive evaluations of the economy (excellent/good), nearly half credit Trump/Republicans (49 percent).  And among those who say the economy is only fair or poor, about one-third blame Trump/Republicans (35 percent) — outpacing greed (10 percent), big business (9 percent), and Obama (9 percent).
The poll also found that a majority think the U.S. economy operates unfairly (55 percent) and feel dissatisfied with “how things are going in the country” (56 percent).
Also, the number of people who like the way things are going dropped to 43 percent, down from 45 percent who felt that way on the 100th day of the Trump administration in April 2017.
Along party lines, 85 percent of Republicans chose excellent or good to describe the economy and 75 percent like the direction the country is taking, while 82 percent of Democrats are unhappy about the country’s direction and give the economy a negative rating — 68 percent rate it “fair or poor.”
Trump’s overall approval rating is holding steady at 45 percent.
While the poll shows 54 percent of respondents disapprove of Trump, his approval rating among Republicans is at an all-time high at 91 percent — up from 85 percent last month.
“The president’s job approval on the economy has consistently outpaced his overall job approval, and even many voters who may take issue with his tone or style will acknowledge the economy has been strong overall during his presidency,” Kristen Soltis Anderson, a Republican pollster and Fox News contributor, said in the report. “A strong economy creates a good foundation for an incumbent seeking re-election, even if voters will also say things could always be even better or more fair.”
Democrat pollster Chris Anderson disagrees.
“Trump’s approval on the economy is up, but this is tenuous ground on which to stake his re-election, because even though most think economic conditions are good, a majority also believes the economy is unfair,” Anderson said. “Outside the Republican base, voters think the economy under Trump doesn’t work for most people.”
Some other findings of the poll include: 
• Forty-five percent feel confident in Trump’s judgment in a crisis.  That’s down from a high of 50 percent at the beginning of his term (February 2017).  Fifty-two percent lack confidence, including 42 percent who are “not at all confident.”
• On Trump’s handling of relations with Iran, 27 percent think he has made the U.S. safer, while far more, 48 percent, say less safe.  About one in five say no difference (19 percent).
• The bulk of voters, 47 percent, say Trump did the right thing when he ordered the U.S. military action that killed Iranian General Soleimani, while 37 percent think he did the wrong thing, and 16 percent are unsure.
• Eighty-three percent of Democrats think Trump should get congressional consent before ordering military action. That’s up 7 points compared to when the question was posed about Obama in 2013 (76 percent).
The poll was conducted January 19-22 and included interviews with 1,005 randomly chosen registered voters nationwide on both land lines and cell phones. The poll has a margin of sampling error of plus or minus 3 percentage points.
Follow Penny Starr on Twitter





The financial oligarchy go into the New Year 

celebrating their massive accumulation of 

wealth and the so-called mainstream media 

will continue to maintain the fiction that the 

US and, by extension, the global economy, 

remain sound. But the reality is that the seeds

of another financial catastrophe have not 

only been planted but are rapidly 

germinating.


Mike Bloomberg: Don’t Believe Trump – Our Economy Is Broken


By 
Michael R. Bloomberg



Democratic Presidential candidate Michael Bloomberg addresses a crowd in North Carolina. Photograph by Melissa Sue Gerrits/Getty Images

This article originally appeared on MarketWatch, a sister publication of Barron’s.

President Donald Trump says our economy is “the best it has ever been,” and he is planning to ride that false claim to a second term.
I won’t let him get away with it. I have the track record—in business and government—to show America what real economic leadership looks like.
Sure, the stock market is at an all-time high. But almost half the country doesn’t own any stocks. And yes, the unemployment rate is low. But nearly half of all workers are in jobs that earn $18,000 at the median. In fact, the share of national income going to workers—rather than investors—is near an all-time low.
Too much wealth is in too few hands. And while a handful of big cities are doing well, a lot of the country is struggling; our middle class is being hollowed out; and working Americans are being squeezed by higher prices on everything from health care to housing.
As a candidate, Trump promised to take on these issues. As president, he has been in the pockets of the special interests that dominate Washington.
Remember when candidate Trump promised to deliver for regular people—the forgotten Americans?
Well, President Trump pushed through the 
biggest tax cut for the wealthy in history, and 
nearly all the money goes to people like me, 
who don’t need it.
Remember when candidate Trump stood in front of the GM factory in Lordstown, Ohio and promised to keep it open?
In 2018, that plant closed down.
Remember when candidate Trump promised to “protect the farmers”?
Last year, farmers lost billions of dollars, and many lost their farms, as a direct result of his tariffs and trade wars.
Again and again, candidate Trump made economic promises to working people that he had no intention of keeping. And sure enough, he has broken all of them.
In fairness, we faced serious economic problems before President Trump took office. That’s one of the reasons he won. He promised to fix them.
Instead, he has made them worse.
We need to elect a leader who can actually deliver real change—not just talk about it—and create more good jobs, with good salaries, all across America.
And I know I can do that, because I’ve done it.
Coming from a middle-class home, where my father never made more than $6,000 in a year, I was lucky to get a good education and work my way up from an entry-level job. When I got laid off, I started a company from scratch that now employs 20,000 people. We pay good salaries and provide the best health benefits money can buy, including six months of parental leave—at full pay.
As mayor of New York, I helped create nearly 500,000 new jobs, most of them outside of Manhattan.
When I was first elected shortly after the terrorist attacks of 9/11, the question everyone asked us was: Can you rebuild Lower Manhattan?
Our answer was: Yes, but that’s not enough.
We set out to rebuild every area of the city, starting with those outside Manhattan that had faced decades of industrial abandonment and decay. We spread good jobs with good salaries to those communities. I know we can bring about that kind of progress all across America.
This week on the South Side of Chicago, I announced some of the core elements of the strategy I’ll take to create millions of good jobs where they are needed most, by investing in areas of the country that have been hurt by globalization and automation, and have been ignored by the federal government for too long.
To start, I will dramatically increase spending on research and development, by over $100 billion. Rather than sending that money to only a few places that already have massive research budgets, like Harvard and Stanford, we’ll spread it to places like Akron, Ohio, where I was today.
The way we’ll do it is by funding new “job factories” in Akron and around the country, with the goal of bringing opportunity to places that don’t have enough of it. We call them job factories because that’s what they’ll produce: jobs. They’ll do it by generating scientific breakthroughs in a wide variety of areas, which will generate millions of good jobs in everything from green energy and sustainable agriculture to advanced manufacturing and public health.
We’ll also make sure Americans have the skills they need to do the work—supporting community colleges, apprenticeships, and job-training programs all across our country.
In addition to preparing people for good jobs, we will modernize the social contract between employee and employer—so laborers are protected, no matter where they work.
We will do that by working to guarantee paid sick leave and paid family leave for all workers—just as we do at my company. We will support the right of all workers to organize and bargain collectively—including gig, contract, and franchise employees, many of whom have to work two or three jobs to put food on the table.
I know a lot of candidates say they’re going to create good jobs. But for me, creating good jobs is not something I just talk about. It’s what I’ve spent my whole career doing.
That’s a key part of the message we need to beat Trump. I’m ready to take it directly to him.
Michael R. Bloomberg, the former mayor of New York City, is the founder of Bloomberg LP.


Share market boom masks another financial crisis in the making

Wall Street stock market indexes are set to finish the year at or near record highs in marked contrast to the end of 2018 when they experienced their worst December since 1931 in the midst of the Great Depression.
The rise and rise of stock prices over the course of the year—the S&P 500 is up by more than 29 percent—has been the principal factor in the further escalation of the wealth of the ultra-rich with Bloomberg reporting that their net worth has risen by $1.25 trillion, or 25 percent.
The escalation of the financial markets, 
however, is not an expression of economic 
health. Rather, the social disease of ever-
rising inequality, coupled with worsening 
wages and living standards for millions, is the 
contradictory expression of a gathering crisis 
located at the very heart of the financial 
system itself.
The year 2019 will go down in economic history as the great turnaround when the world’s major central banks gave up on their attempt to return to “normal” monetary policy after pumping trillions of dollars into the global financial system in response to the crisis of 2008–9.
These extraordinary actions, rewarding the very banks and financial institutions whose speculative and in some cases outright criminal activities had sparked the crisis, were justified on the basis that they were necessary to save the entire system. When the crisis passed, it was maintained, such “unconventional” monetary policies would cease and there would be a return to “normal.”
But it has become clear over the course of the past decade that this day will never come because, like a drug addict, the entire global financial system has become completely dependent on the supply of ultra-cheap money for the accumulation of profit.
To give the US Federal Reserve its due it did make an attempt to at least restrict the supply. It carried out four interest rates rises in 2018, on the back of a slight upturn in the US and global economy and foreshadowed more of the same in 2019. It even committed itself to start winding down its massive holdings of financial assets which, as a result of quantitative easing, had expanded to more than $4 trillion from $800 billion in 2007.
The violent reaction of Wall Street to these measures at the end of 2018, amid denunciations of the Fed by President Trump, meant that even these limited measures were shelved. The underlying weakness of the US economy and the fragility of the financial system, where corporate debt has risen close to a record $10 trillion (equivalent to 47 percent of the total economy) and some 50 percent of corporate bonds are rated at BBB (just above junk status), meant it could not sustain a base interest rate above the historically low rate of 2.5 percent.
Fed chairman Powell started the year by making clear there would be no rates rises and in July made the first of what were to be three interest rate cuts for the year. The winding down of asset holdings was halted. These actions have been duplicated by the European Central Bank which has further cut its base interest this year and resumed its asset purchases, adding to the €2.6 trillion stock it already holds, while the Bank of Japan continues its quantitative easing program.
The Fed has not officially resumed quantitative easing but it has intervened aggressively in the short-term financial market following a spike in the overnight repo rate last September. The repo market is crucial to the day-to-day functioning of the financial system as financial institutions borrow money overnight to close their books at the end of the trading day. Under normal conditions, the repo interest rate tracks the Fed’s base rate. But in mid-September it spiked to as high as 10 percent.
Since then the Fed has intervened to the 

tune of hundreds of billions of dollars and 

reversed more than half the previous 

reduction of its asset portfolio.
One of the most significant effects of central bank policy has been in the market for government bonds. It has been said that 2019 was the year when bond market logic was turned on its head. Bond markets have traditionally functioned as an arena for virtually risk-free investment at a relatively low rate of return. Their operations have formed the basis for investments by pension funds and insurance companies that have to balance their long-term liabilities with secure assets.
But in the middle of this year the mass of bonds yielding negative yields reached $17 trillion. Since then the amount of bonds with negative yields has fallen to $12 trillion, but this is still far beyond anything that has occurred in the past.
A negative yield occurs when the price of a bond in the market has gone so high that if an investor purchased it and held it to maturity they would make a loss. Of course, under those conditions investors do not buy bonds in order to hold them to maturity. They do so in anticipation that prices will rise even further and they will be able to sell them and make a capital gain. And the converse applies. If interest rates rise and the price of the bond falls (the two move in the opposite direction) the investors will make a loss.
The emergence of negative yields in bond markets as a result of central bank monetary policies is the expression of a financial bubble in an area of the market that had previously provided some stability.
In a recent comment on Bloomberg entitled “When the ultimate refuge turns risky,” financial analyst Satyaijit Das noted: “Until the financial crisis of 2008, government bonds were the traditional haven for investors. More than a decade on, their nature has fundamentally changed. In any future crisis, sovereign debt will be a propagator of risk rather than a refuge.”
He warned that despite record low interest rates and low inflation the risk on these supposedly safe assets was increasing. Once they provided risk-free returns. Now, with yields at record lows, they provide only return-free risks.
The danger is that problems in the credit worthiness of government bonds of any country can rapidly be transmitted throughout the financial system as losses on bond holdings create selling pressure leading to rising debt costs. In a recent report, the World Bank pointed to a “global debt wave” that had led to the growth of debt in emerging market economies to a “towering” $55 trillion—the largest in history. Emerging markets are not the only source of potential instability. In the advanced economies government debt has risen to more than 100 percent of gross domestic product compared to 70 percent in 2007.
The significance of the debt bubble in government bonds emerges in clearer focus when it is viewed in the context of the financial crises of the past three decades. The stock market crash of October 1987, when Wall Street experienced its largest one day fall in history, was the result of a share price bubble. Then came the Asian crisis of 1997–98, set off by an emerging market bubble. It was followed by the collapse of the tech bubble in the early 2000s and then the financial crash of 2008–9, sparked by a bubble in the housing market which resulted in a crisis with the onset of recessionary trends at the end of 2007.
Now there is a bubble in the market for government bonds, which in previous periods has functioned as the bedrock of the financial system. Moreover, the world’s major central banks are directly involved because of their purchases of government bonds over the past decade. As Das noted: “It is ironic that actions taken to preserve the system and a key instrument—government bonds—now pose a key threat to financial stability.”
The financial oligarchy go into the New Year 
celebrating their massive accumulation of 
wealth and the so-called mainstream media 
will continue to maintain the fiction that the 
US and, by extension, the global economy, 
remain sound. But the reality is that the seeds
of another financial catastrophe have not 
only been planted but are rapidly germinating.

 

TRUMPERNOMICS:

Billionaires’ wealth surged in 2019

28 December 2019
As the second decade of the 21st century comes to a close, its most salient feature—the plundering of humanity by a global financial oligarchy—continues unabated.
Amidst trade war and the growth of militarism and authoritarianism on the one side, and an eruption of international strikes and protests by the working class against social inequality on the other, the stock market is hitting record highs and the fortunes of the world’s billionaires are continuing to surge.
On Friday, one day after all three major US stock indexes set new records, Bloomberg issued its end-of-year survey of the world’s 500 richest people. The Bloomberg Billionaires Index reported that the oligarchs’ fortunes increased by a combined total of $1.2 trillion, a 25 percent rise over 2018. Their collective net worth now comes to $5.9 trillion.
To place this figure in some perspective, these 500 individuals control more wealth than the gross domestic product of the United States at the end of the third quarter of 2019, which was $5.4 trillion.
The year’s biggest gains went to France’s Bernard Arnault, who added $36.5 billion to his fortune, bringing it above the rarified $100 billion level to $105 billion. He knocked speculator Warren Buffett, at $89.3 billion, down to fourth place. Amazon boss Jeff Bezos lost nearly $9 billion due to a divorce settlement, but maintained the top position, with a net worth of $116 billion. Microsoft founder Bill Gates gained $22.7 billion for the year and held on to second place at $113 billion.
The 172 American billionaires on the Bloomberg list added $500 billion, with Facebook’s Mark Zuckerberg recording the year’s biggest US gain at $27.3 billion, placing him in fifth place worldwide with a net worth of $79.3 billion.
It is difficult to comprehend the true significance of such stratospheric sums. In his 2016 book Global Inequality, economist Branko Milanovic wrote:
"A billion dollars is so far outside the usual experience of practically everyone on earth that the very quantity it implies is not easily understood… Suppose now that you inherited either $1 million or $1 billion, and that you spent $1,000 every day. It would take you less than three years to run through your inheritance in the first case, and more than 2,700 years (that is, the time that separates us from Homer’s Iliad) to blow your inheritance in the second case."
The vast redistribution of wealth from the bottom to the top of society is the outcome of a decades-long process, which was accelerated following the 2008 Wall Street crash. It is not the result of impersonal and simply self-activating processes. Rather, the policies of capitalist governments and parties around the world, nominally “left” as well as right, have been dedicated to the ever greater impoverishment of the working class and enrichment of the ruling elite.
In the US, the top one percent has captured all of the increase in national income over the past two decades, and all of the increase in national wealth since the 2008 crash.
The main mechanism for this transfer of wealth has been the stock market, and the policies of the US Federal Reserve and central banks internationally have been geared to providing cheap money to drive up stock prices. The cost of this massive subsidy to the financial markets and the oligarchs has been paid by the working class, in the form of social cuts, mass layoffs, the destruction of pensions and health benefits, and the replacement of relatively secure and decent-paying jobs with part-time, temporary and contingent “gig” positions.
Since Trump was inaugurated in January of 2017, pledging to slash corporate taxes, lift regulations on big business and dramatically increase the military budget, the Dow has surged by 9,000 points. This year, Trump and the financial markets applied massive pressure on the Fed to reverse its efforts to “normalize” interest rates. The Fed complied, carrying out three rate cuts and repeatedly assuring the markets it had no plans to raise rates in 2020.
This windfall for the banks and hedge funds was supported by the Democrats no less than the Republicans. In fact, Trump’s economic policy has been given de facto support by the Democratic Party all down the line—from his tax cuts for corporations and the rich to his attack on virtually all regulations on business. Even in the midst of impeachment—carried out entirely on the grounds of “national security” and Trump’s supposed “softness” toward Russia—the Democrats have voted by wide margins for Trump’s budget, his anti-Chinese US-Mexico-Canada trade pact and his record $738 billion Pentagon war budget.
This has included giving Trump all the money he wants to build his border wall and carry out the mass incarceration and persecution of immigrants.
Trump’s pro-corporate policies are an extension and expansion of those pursued by the Obama administration. It allocated trillions in taxpayer money to bail out the banks and flooded the financial markets with cheap credit, driving up stock prices, while imposing a 50 percent across-the-board cut in pay for newly hired autoworkers in its bailout of General Motors and Chrysler. Obama oversaw the closure of thousands of schools and the layoff of hundreds of thousands of teachers, and enacted austerity budgets that slashed social programs.
Two of those running for the 2020 Democratic presidential nomination are billionaires—Tom Steyer and Michael Bloomberg. The latter, with a net worth of $56 billion, is the ninth richest person in the US. He entered the race as the spokesman for oligarchs outraged over talk from Bernie Sanders and Elizabeth Warren of token tax increases on the super-rich.
The oligarchs are not frightened by Sanders and Warren—two longstanding defenders of the American ruling class, who seek to mask their subservience to capital with talk of making the oligarchs pay “their fair share,” a euphemism for defending their right to pillage the population. The billionaires are frightened by the growth of mass opposition to capitalism that finds a distorted expression in support for the phony “progressives” in the Democratic fold.
Between them, Bloomberg and Steyer have already spent $200 million of their own money in an effort to buy the election outright.
The impact of the policy of social plunder is seen in the deepening of a malignant social crisis in country after country. In the US, society is marching backwards, as the crying need for schools, hospitals, affordable housing, pensions, the rebuilding of decrepit roads, bridges, transportation, flood control, water and sewage, fire control and electricity grids is met with the official response: “There is no money.”
The result? Three straight years of declining life expectancy, record addiction and suicide rates, devastating wildfires and floods, electricity cut-offs by profiteering utility companies. And a climate crisis that cannot be addressed within the framework of a system dominated by a money-mad plutocracy.
Not a single serious social problem can be addressed under conditions where the ruling elite—through its bribed parties and politicians, aided by its pro-capitalist trade unions and backed up by its courts, police and troops—diverts resources from society to the accumulation of ever more luxurious yachts, mansions, private islands and personal jets.
The watchword must be—in opposition to the Corbyns, the Sanders, the Tsiprases and their pseudo-left promoters—“Expropriate the super-rich!”

Bloomberg: 2019 a Good Year for Wealthy; Jeff Bezos Remains on Top Despite $9 Billion Loss in Divorce

For the already wealthy and those who struck gold for the first time, 2019 was a good year for the rich.

Bloomberg News’ billionaire index is reporting on the money made this past year, including Amazon founder and Washington Post owner Jeff Bezos remaining on the top of the heap despite a divorce settlement with his ex-wife that led to a $9 billion decrease in his portfolio:
The leveraging of a giant social-media presence, a catchy tune about a family of sharks and a burgeoning collection of junkyards are just a few of the curious ways that helped make 2019 a fertile year for fortunes to blossom around the world.
Kylie Jenner became the youngest self-made billionaire this year after her company, Kylie Cosmetics, signed an exclusive partnership with Ulta Beauty Inc. She then sold a 51% stake for $600 million.
It has been almost two months since the Washington Nationals captured their first World Series championship, but people around the world are still singing along to the baseball team’s adopted rallying cry: “Baby Shark, doo-doo doo-doo doo-doo.” The Korean family that helped popularize the viral earworm are now worth about $125 million.
The new wealthy includes Willis Johnson of Oklahoma who has amassed a $1.9 billion fortune from building a network of junkyards that sell damaged automobiles, according to Bloomberg News.
Bloomberg reported that the 500 wealthiest people around the world added $1.2 trillion to their wealth, “boosting their collective net worth 25 percent to $5.9 trillion.”
“Leading the 2019 gains was France’s Bernard Arnault, who added $36.5 billion as he rose on the Bloomberg index to become the world’s third-richest person and one of three centibillionaires — those with a net worth of at least $100 billion,” Bloomberg reported.
Ironically, Bezos was one of 52 people who had a decline in their fortune, in his case because of a divorce settlement with MacKenzie Bezos who is now on the billionaires list ranking No. 25 with a net worth of $27.5 billion.
Bloomberg reported on the winners:
  • The 172 American billionaires on the Bloomberg ranking added $500 billion, with Facebook Inc.’s Mark Zuckerberg up $27.3 billion and Microsoft Corp. co-founder Bill Gates up $22.7 billion.
  • Representation from China continued to grow, with the nation’s contingent rising to 54, second only to the U.S. He Xiangjian, founder of China’s biggest air-conditioner exporter, was the standout performer as his wealth surged 79 percent to $23.3 billion.
  • Russia’s richest added $51 billion, a collective increase of 21 percent, as emerging-market assets from currencies to stocks and bonds rebounded in 2019 after posting big losses a year earlier.
And “losers”:
  • Rupert Murdoch’s personal fortune dropped by about $10 billion after proceeds from Walt Disney Co.’s purchase of Fox assets were distributed to his six children, making them billionaires in their own right.
  • Interactive Brokers Group Inc.’s Thomas Peterffy saw his wealth slump by $2.1 billion as investors weighed a reshaped competitive landscape for brokerage businesses after rival Charles Schwab Corp. eliminated commissions and agreed to buy TD Ameritrade Holding Corp.
  • WeWork’s Adam Neumann saw his fortune implode — at least on paper — as the struggling office-sharing company’s valuation dropped to $8 billion in October from an estimated $47 billion at the start of the year. Still, SoftBank Group Corp.’s rescue package left Neumann’s status as a billionaire intact.
And the new billionaires:
  • White Claw, the “hard seltzer” that was the hit of the summer among U.S. millennials, helped boost Anthony von Mandl’s net worth to $3.6 billion.
  • Mastering the art of fast-food deliveries proved rewarding for Jitse Groen, whose soaring Takeaway.com NV lifted his wealth to $1.5 billion.
  • The popularity of soy milk gave eight members of Hong Kong’s Lo family a combined $1.5 billion.


A new Gilded Age has emerged in America — a 21st century version.
The wealth of the top 1% of Americans has grown dramatically in the past four decades, squeezing both the middle class and the poor. This is in sharp contrast to Europe and Asia, where the wealth of the 1% has grown at a more constrained pace.

The Lessons of Theodore Roosevelt

To get out of our Second Gilded Age, look no further than how we got out of the first one.
We’ve been rocked by scandals over the past year involving the nation’s most wealthy and powerful. We’ve learned that a twisted multimillionaire allegedly procured and raped girls in his Manhattan mansion and on his private Caribbean Island; entitled celebrities and corporate plutocrats paid millions of dollars in bribes to get their kids into elite universities; pillars of the Hollywood and media establishments have used their stature to sexually prey upon underlings; and, yes, our president was caught lying about possibly violating campaign finance laws with hush money payoffs to a porn star and Playboy bunny.
This moral corruption is accompanied by the regressive government policies of a scandal-stained administration. President Donald Trump is rolling back programs that protect consumers, voting rights, the environment, and competitive commerce faster than Congress can issue subpoenas. His cabinet includes 17 millionaires, two centimillionaires, and one billionaire with a combined worth of $3.2 billion, according to Forbes. He presides over the most corrupt administration in American history, one marked by nepotism and self-dealing. His so-called “A Team” of senior officials has undergone a record 75 percent turnover since he took office—most of whom resigned under pressure, often caught up in scandal.
Commerce Secretary Wilbur Ross, whose net worth is estimated at $600 million, reflected the arrogance and empathy deficit that typifies the Trump White House during last winter’s record-long government shutdown. He suggested that federal workers just take out loans until they got paid.
But nobody tops the swamp king, Trump himself. Forget the sleaze, forget the obstruction of justice, forget the constant dissing of Congress. His defying the Constitution’s emoluments clause alone would, in a normally functioning American democracy, make him the subject of impeachment. Instead, he flouts the rules as if they don’t apply to him. If he gets his way and hosts next year’s G-7 summit at Mar-a-Lago, we may as well send the Constitution to the shredder. And yet, as more recent controversies have shown us, including the Varsity Blues college admissions scandal and Jeffery Epstein’s sex trafficking racket, this kind of indifference to moral values is not confined to government grandees.
So, what gives? Is America drowning in a marsh of unchecked corruption and entitlement brought on by latter-day Louis XVI’s and Marie Antoinettes? Are the uber-wealthy out of control? There’s something rotten in America and, if we don’t fix it soon, we invite a new wave of national decline and social disintegration.
The good news is that we have faced similar challenges before. Some prescriptions from a previous era may provide a lodestar for a future Democratic president to steer the country in the right direction. As Mark Twain, who coined the term “the Gilded Age,” once said, “The external glitter of wealth conceals a corrupt political core that reflects the growing gap between the very few rich and the very many poor.” He was talking about the original Gilded Age, but that diagnosis could just as easily apply to our current American condition.
The first Gilded Age was marked by rapid economic growth, massive immigration, political corruption, and a high concentration of wealth in which the richest one percent owned 51 percent of property, while the bottom 44 percent had a mere one percent. The oligarchs at the top were popularly known as “robber barons.”
Theodore Roosevelt, who was president at the time, understood that economic inequality itself becomes a driver of a dysfunctional political system that benefits the wealthy but few others. As he once famously warned, “There can be no real political democracy unless there is something approaching economic democracy.”
His response to the inequities of his times, which came to define the Progressive Era, have much to teach us now about how to sensibly tackle economic inequality. It’s worthwhile to closely examine the Rooseveltian playbook. For instance, his “Square Deal” made bold changes in the American workplace, government regulation of industry, and consumer protection. These reforms included mandating safer conditions for miners and eliminating the spoils system in federal hiring; bringing forty-four antitrust suits against big business, resulting in the breakup of the largest railroad monopoly, and regulation of the nation’s largest oil company; and passing the Meat Inspection Act and Pure Food and Drug Act, which created the FDA. He prosecuted more than twice as many antitrust suits against monopolistic businesses than his three predecessors combined, curbing the robber barons’ power. And he relentlessly cleaned up corruption in the federal government. One-hundred-forty-six indictments were brought against a bribery ring involving public timberlands, culminating in the conviction and imprisonment of a U.S. senator, and forty-four Postal Department employees were charged with fraud and bribery.
Now, we are in a Second Gilded Age, facing many of the same problems, and, in some ways, to an even greater degree. The gap between the rich and everyone else is even greater than it was during the late 19th Century, when the richest two percent of Americans owned more than a third of the nation’s wealth. Today, the top one percent owns almost 40 percent of the nation’s wealth, or more than the bottom 90 percent combined, according to the nonpartisan National Bureau of Economic Research. The first Gilded Age saw the rise of hyper-rich dynastic families, such as the Rockefellers, Mellons, Carnegies, and DuPonts. Today, three individuals—Jeff Bezos, Bill Gates, and Warren Buffett—own more wealth than the bottom half of the country combined. And three families—the Waltons, the Kochs, and the Mars—have enjoyed a nearly 6,000 percent rise in wealth since Ronald Reagan took the oath as president, while median U.S. household wealth over the same period has declined by three percent.
The consequences of this wealth gap are dire. Steve Brill explains in his book Tailspin that, by manipulating the tax and legal systems to their benefit, America’s most educated elite, the so-called meritocracy, have built a moat that excludes the working poor, limiting their upward mobility and increasing their sense of alienation, which then gives rise to the populist streak that allowed politicians like Trump to captivate enough of the American electorate.
Similarly, psychologist Dacher Keltner’s research shows that power in and of itself is a corrupting force. As he documents in The Power Paradox, powerful people lie more, drive more aggressively, are more likely to cheat on their spouses, act abusively toward subordinates, and even take candy from children. Too often, they simply do not respect the rules.
For example, in monitoring an urban traffic intersection, Keltner found that drivers of the least expensive vehicles virtually always yielded to pedestrians, whereas drivers of luxury cars yielded only about half of the time. He cites surveys covering 27 countries that show that rich people are more likely to admit that it’s acceptable to engage in unethical behavior, such as accepting bribes or cheating on taxes.“The experience of power might be thought of as having someone open up your skull and take out that part of your brain so critical to empathy and socially appropriate behavior,” says Keltner.
That’s why we need to reform our political system if we are to survive the rampant amorality and lawlessness of the Second Gilded Age. Simply put, so very few should not wield so much sway over so many.
One of the first priorities of an incoming administration should be to narrow the wealth and income gap. French economist Thomas Picketty favors a progressive annual wealth tax of up to two percent, along with a progressive income tax as high as 80 percent on the biggest earners to reduce inequality and avoid reverting to “patrimonial capitalism” in which inherited wealth controls much of the economy and could lead essentially to oligarchy.
The leading 2020 Democratic candidates favor raising taxes, as well. Elizabeth Warren has proposed something commensurate to Picketty’s two percent wealth tax for those worth more than $50 million, and a three percent annual tax on individuals with a net worth higher than $1 billion. She has also proposed closing corporate tax loopholes. Joe Biden wants to restore the top individual income tax rate to a pre-Trump 39.6 percent and raise capital gains taxes. Bernie Sanders has proposed an estate tax on the wealth of the top 0.2 percent of Americans.
Following Theodore Roosevelt’s example, we need to aggressively root out the tangle of corruption brought on by Trump and his minions. This has already begun with multiple and expanding investigations led by House Democrats into the metastasizing malfeasance within the Trump administration. Trump’s successor, however, should work with Congress to appoint a bipartisan anti-corruption task force to oversee prosecutions and draw up reform legislation to prevent future abuses.
“Of all forms of tyranny, the least attractive and the most vulgar is the tyranny of mere wealth, the tyranny of a plutocracy,” Roosevelt once warned. The free market has made America the great success it is today. But history has shown that unconstrained capitalism and a growing wealth gap leads to an unhealthy concentration of wealth in the hands of a few. When the gap between the haves and the have-nots goes unchecked, populism takes hold, leading to the election of dangerous demagogues like Trump, and the disastrous politics they bring with them. It is not too late to reverse course. But first, we need to re-learn the lessons from our first Gilded Age if we are going to get out of the current one.

 

Economists: America’s Elite Pay Lower Tax Rate Than All Other Americans


The wealthiest Americans are paying a lower tax rate than all other Americans, groundbreaking analysis from a pair of economists reveals.

For the first time on record, the wealthiest 400 Americans in 2018 paid a lower tax rate than all of the income groups in the United States, research highlighted by the New York Times from University of California, Berkeley, economists Emmanuel Saez and Gabriel Zucman finds.
The analysis concludes that the country’s top economic elite are paying lower federal, state, and local tax rates than the nation’s working and middle class. Overall, these top 400 wealthy Americans paid just a 23 percent tax rate, which the Times‘ op-ed columnist David Leonhardt notes is a combined tax payment of “less than one-quarter of their total income.”
This 23 percent tax rate for the rich means their rate has been slashed by 47 percentage points since 1950 when their tax rate was 70 percent.
(Screenshot via the New York Times)
The analysis finds that the 23 percent tax rate for the wealthiest Americans is less than every other income group in the U.S. — including those earning working and middle-class incomes, as a Times graphic shows.
Leonhardt writes:
For middle-class and poor families, the picture is different. Federal income taxes have also declined modestly for these families, but they haven’t benefited much if at all from the decline in the corporate tax or estate taxAnd they now pay more in payroll taxes (which finance Medicare and Social Security) than in the past. Over all, their taxes have remained fairly flat. [Emphasis added]
The report comes as Americans increasingly see a growing divide between the rich and working class, as the Pew Research Center has found.
Sen. Josh Hawley (R-MO), the leading economic nationalist in the Senate, has warned against the Left-Right coalition’s consensus on open trade, open markets, and open borders, a plan that he has called an economy that works solely for the elite.
“The same consensus says that we need to pursue and embrace economic globalization and economic integration at all costs — open markets, open borders, open trade, open everything no matter whether it’s actually good for American national security or for American workers or for American families or for American principles … this is the elite consensus that has governed our politics for too long and what it has produced is a politics of elite ambition,” Hawley said in an August speech in the Senate.
That increasing worry of rapid income inequality is only further justified by economic research showing a rise in servant-class jobs, strong economic recovery for elite zip codes but not for working-class regions, and skyrocketing wage growth for the billionaire class at 15 times the rate of other Americans.
John Binder is a reporter for Breitbart News. Follow him on Twitter at @JxhnBinder.

 

 

Census Says U.S. Income Inequality Grew ‘Significantly’ in 2018

(Bloomberg) -- Income inequality in America widened “significantly” last year, according to a U.S. Census Bureau report published Thursday.
A measure of inequality known as the Gini index rose to 0.485 from 0.482 in 2017, according to the bureau’s survey of household finances. The measure compares incomes at the top and bottom of the distribution, and a score of 0 is perfect equality.
The 2018 reading is the first to incorporate the impact of President Donald Trump’s end-2017 tax bill, which was reckoned by many economists to be skewed in favor of the wealthy.
But the distribution of income and wealth in the U.S. has been worsening for decades, making America the most unequal country in the developed world. The trend, which has persisted through recessions and recoveries, and under administrations of both parties, has put inequality at the center of U.S. politics.
Leading candidates for the 2020 Democratic presidential nomination, including senators Elizabeth Warren and Bernie Sanders, are promising to rectify the tilt toward the rich with measures such as taxes on wealth or financial transactions.
Just five states -- California, Connecticut, Florida, Louisiana and New York, plus the District of Columbia and Puerto Rico -- had Gini indexes higher than the national level, while the reading was lower in 36 states.

The Democrats’ opposition to Trump is not based on his imposition of austerity measures, or his vicious assault on immigrants. While they will not mount a serious challenge to a proposal that will literally take food out of the mouths of school children, they were complicit in passing the Republicans’ $1.3 trillion tax cuts in 2017 and the record $738 billion defense budget agreed to earlier this year. 

Trump proposal denies free school meals to half a million children

The Trump administration has provided a new analysis of how proposed changes to eligibility for the Supplemental Nutrition Assistance Program (SNAP), commonly known as food stamps, will impact children who participate in the National School Lunch and School Breakfast programs. By the White House’s own admission, these changes mean that about a half-million children would become ineligible for free school meals.
Secretary of Agriculture Sonny Perdue has described the changes as a tightening up of “loopholes” in the SNAP system. But those affected by the changes are not corporate crooks or billionaires, but hundreds of thousands of children who stand to lose access to free meals. For many American children, free school breakfasts and lunches make up the bulk of their nutritional intake, and they stand to suffer permanent physical and psychological damage as a result of the cuts.
Children receive a free lunch at the Phoenix Day Central Park Youth Program in downtown Phoenix. (AP Photo Matt York)
The sheer vindictiveness of the proposed rule change is shown by the minimal savings that would result—about $90 million a year beginning in fiscal year 2021, or a mere 0.012 percent of the estimated $74 billion annual SNAP budget. Put another way, the savings would amount to two-thousandths of a percent of the $4.4 trillion federal budget. But while this $90 million might appear as small change to the oligarchs running and supporting the government, it will be directly felt as hunger in the bellies of America’s poorest children.
SNAP provided benefits to roughly 40 million Americans in 2018 and is the largest nutrition program of the 15 administered by the federal Food and Nutrition Service. Along with programs such as the Nutrition Program for Women, Infants and Children and school breakfast and lunch programs, SNAP has been a major factor in making a dent in the hunger of working-class families. But despite these programs’ successes, the Trump administration is seeking to claw them back, with the ultimate aim of doing away with them altogether.
The US Department of Agriculture (USDA), which administers the food stamp and school meal programs, says that the new analysis presented last week is a more precise estimate of the impact of rule changes in SNAP the USDA first announced in July. The main component of the rule change is an end to “broad-based categorical eligibility” for the food stamp program. Food stamps are cut off for households whose incomes exceed 130 percent of the federal poverty line, or $33,475 per year for a family of four, calculated after exemptions for certain expenses.
Under “broad-based categorical eligibility,” which is currently used by over 40 states, households can be eligible for food stamps based on their receiving assistance from other anti-poverty programs, such as Temporary Assistance for Needy Families. Under this rule, which has been in effect for about 20 years, states are allowed to raise income eligibility and asset limits to promote SNAP eligibility. This prevents many households from falling over the “benefit cliff,” which happens when a small increase in income results in a complete cutoff of benefits, leaving a family worse off than before the rise in income.
According to the USDA, the rule change on broad-based eligibility would throw more than 680,000 households with children off SNAP. About 80 percent of these households have school-age children, amounting to about 982,000 children. Of those, 55 percent, or about 540,000, would no longer be eligible for free school meals, although most would be eligible for reduced-price meals. About 40,000 would be required to pay the full meal rate.
However, this does not paint the full picture. Households thrown off SNAP would be required to apply separately for access to free or reduced-price school meals. The USDA admits that its cost estimates “do not account for potential state and local administrative costs incurred due to collecting and processing household applications … and also do not account for any increased responsibility placed on the households to complete and submit a school meals application.”
While the Trump administration claims that the proposed changes to SNAP eligibility are aimed at closing up “loopholes” and stopping people from claiming benefits they’re not entitled to, the reality is that there is no evidence that broad-based eligibility has allowed significant numbers of people to supposedly “game the system.” A 2012 Government Accountability Office investigation found that only 473,000 recipients, or just 2.6 percent of beneficiaries, received benefits they would not have received without the broad-based eligibility offered by many states.
There is consistent evidence that SNAP contributes to a decrease in food insecurity, a condition defined by the USDA as limited or uncertain access to adequate food. By one estimate, SNAP benefits reduce the likelihood of food insecurity by about 30 percent and the likelihood of being very food insecure by 20 percent. Census data has shown that SNAP also plays a critical role in reducing poverty, with about 3.6 million Americans, including 1.5 million children, being lifted out of poverty in 2016 as a result of the program.
The EconoFact Network reports that SNAP has improved birth outcomes and infant health. When an expectant mother has access to SNAP during pregnancy, particularly in the third trimester, it decreases the likelihood that her baby will be born with low birth weight. There is also evidence that the benefits of nutrition support can persist well into adulthood when access to SNAP is provided before birth and during early childhood. This can have a long-term impact on an individual’s earnings, health and life expectancy. Conversely, food insecurity in childhood correlates with greater risk of developing high blood pressure, diabetes, obesity and cardiovascular disease later in life.
The proposed threat to school lunches for half a million children has elicited little response from Democrats in Congress, who are obsessively focused on the Trump impeachment inquiry. Critical issues such as the health and nutrition of school children are of little consequence to the Democratic Party, which instead gives voice to those sections of the military intelligence apparatus that sees Trump’s actions, particularly his sudden pullout from Syria, as endangering the global interests of American imperialism.
The Democrats’ opposition to Trump is not based on his imposition of austerity measures, or his vicious assault on immigrants. While they will not mount a serious challenge to a proposal that will literally take food out of the mouths of school children, they were complicit in passing the Republicans’ $1.3 trillion tax cuts in 2017 and the record $738 billion defense budget agreed to earlier this year. At $94.6 million, the cost of one of the US Air Force’s newest and most technologically advanced fighter jets, the F-35A, would cover the $90 annual savings from depriving half a million US schoolchildren of free meals.

The Democrats’ opposition to Trump is not based on his imposition of austerity measures, or his vicious assault on immigrants. While they will not mount a serious challenge to a proposal that will literally take food out of the mouths of school children, they were complicit in passing the Republicans’ $1.3 trillion tax cuts in 2017 and the record $738 billion defense budget agreed to earlier this year. 


No comments: