The $50 Trillion Ransacked from Workers by America’s Upper class Is Trickling Back

As I frequently keep in mind here, when you press the pendulum to an extreme of wealth and earnings inequality, it will swing to the opposite extreme minus a tiny bit of friction.

The depth of America’s brainwashing can be measured by the undisputed presumption that Capital should earn 15% every year, rain or shine, while employees are fated to lose ground every year, rain or shine. And if earnings ought to ever start ticking upward even somewhat, then the Billionaires’ Apologists are released to scream that higher earnings suggests higher inflation, which will kill the economic “recovery.”

Said another way: if wages stagnate so employees lose ground every year as inflation in essentials increases, that’s the way it ought to be. If salaries rise so employees can keep up with inflation, then that will trigger an inflationary death spiral.

That this indoctrination is so commonly accepted exposes the success of America’s Upper class in reshaping the story to make their plundering appear to be “inevitable.” However the siphoning of $50 trillion from employees to the Upper class, and the Nobility’s control of political power was anything however inescapable: it was engineered by policies that enhanced billionaires, the leading 0.01% Aristocracy, and the leading 10% who own 90% of America’s productive capital.

This wholesale transfer of wealth and income from employees to Capital was documented by a RAND Corporation report, Trends in Income From 1975 to 2018. Time publication summarized the findings: The Leading 1% of Americans Have Taken $50 Trillion From the Bottom 90%– Which’s Made the U.S. Less Protect.

There are some who blame the existing predicament of working Americans on structural changes in the underlying economy– on automation, and especially on globalization. According to this popular narrative, the lower incomes of the past 40 years were the regrettable but required cost of keeping American organizations competitive in a progressively ruthless global market. However in reality, the $50 trillion transfer of wealth the RAND report files has taken place totally within the American economy, not between it and its trading partners. No, this upward redistribution of income, wealth, and power wasn’t inescapable; it was a choice– a direct result of the trickle-down policies we chose to execute given that 1975.

The net outcome of this four-decade siphoning of wealth/income from employees was recently documented by a Foreign Affairs short article: Monopoly Versus Democracy:

Ten percent of Americans now control 97 percent of all capital earnings in the country. Almost half of the new earnings produced because the international monetary crisis of 2008 has actually gone to the most affluent one percent of U.S. people. The wealthiest three Americans jointly have more wealth than the poorest 160 million Americans.

Simply put, the bottom 90% have extremely little stake in the status quo: they receive essentially zero income from America’s stupendous $121 trillion hoard of private wealth and have essentially zero political impact, as documented in Checking Theories of American Politics: Elites, Interest Groups, and Average People.

Now the worm has finally turned, and employees are contradicting the Neofeudal dominance of the Upper class, not by open revolts that the State can strongly squash but by indirect means. Fed-up Boomers are retiring, fed-up Gen-Xers are cutting their hours, declining to return to the workplace, beginning their own enterprises and Millennials are assembling numerous earnings streams, building micro-houses, and leveraging lacks of employees for higher incomes.

The techno-fantasy that’s Corporate America’s fondest dream is automation of all labor: eliminate all human workers and just handle the robots with caring care. However the truth is robots have limitations, as I explain in my book Will You Be Richer or Poorer?— limitations enforced by physics and finance.

Therefore, weeping inconsolably, Corporate America continues exploiting its workforce with the usual risks: you’re powerless because we can automate your job or offshore it to Lower Slobovia.

Contrast this with the real world: a young man of my associate just recently took a job at a Business America Big Box outlet. His wage was $12/hour, and all the power was naturally in the hands of Business America: he had no power over his schedule, or anything else.

In the script of the past 4 decades, Corporate America (while crushing small company and purchasing the best government money can purchase) could keep the serfs slaving away for stagnating incomes, all in service of making the most of corporate insiders’ stock choices, buybacks and skyrocketing profits.

This person was tipped off to a better chance, and when he provided notification to the Big Box supervisor, the manager confined him for two hours, first using a $3/hour raise (25%) and then badgering him to remain on as a serf on the Huge Box plantation. He declined.

This is the pure distillation of Corporate America and the Upper class: if they ‘d used this hard-working person the 25% raise after he showed his worth, then possibly he wouldn’t have actually been so determined to seek better chances elsewhere.

At long last, some the $50 trillion plundered from workers is trickling back to individuals who actually create the earnings and wealth. As a thought experiment, think about an economy in which farmers and workers reaped 15% gains yearly like clockwork, and Corporate America’s insiders, financiers and speculators, and Wall Street’s parasites all lost 15% of their wealth and income every year like clockwork.

To put it simply, think of the $50 trillion flowing back to those who produced it from those who robbed it.

As I typically note here, when you press the pendulum to an extreme of wealth and earnings inequality, it will swing to the opposite extreme minus a little bit of friction. The serfs are silently slipping away, and the Aristocracy, blinded by hubris and greed, believes absolutely nothing will ever alter because, well, their wealth and power is should have. What they really deserve will manifest in the next four years as the chairs at the banquet of consequences are mixed.

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