Technological evolution has been parasitized by a .01% who cause average American families to devolve from an economy in the 1950’s and ‘60s where one adult wage-earner could successfully raise a family and gain wealth, to today’s economy where over 75% of two adult wage-earners struggle to raise a family and cannot gain wealth.
An extensive analysis of economic conditions and government policy reveals that the need for significant systemic change is now a mathematical fact. Corruption, greed and economic inequality have reached a peak tipping point. Due to the consolidation of wealth, the majority of the population cannot generate enough income to keep up with the cost of living. In the present economy, under current government policy, 70% of the population is now sentenced to an impoverished existence.
Let’s take an in-depth look at the evidence.
I: The Ultra-Rich .01%
To see how corrupt the United States government has become, just follow the money. According to the most recent Federal Reserve Flow of Funds report, US households currently have an all-time high $82 trillion in overall wealth. If that wealth were spread out evenly, every US household would now have $712k. However, as of the end of 2013, the median household only had $56k in wealth. From 2007 – 2013, overall wealth increased 26%, while the median household lost a shocking 43% of their wealth. If median wealth continues to decline at this rate, over 50% of US households will be bankrupt within the next decade.
The fact that the majority of households are losing so much wealth in a time of record-breaking overall wealth demonstrates how systemically corrupt the economy has become. To begin to grasp the scale of corruption, let’s analyze how much wealth has been consolidated within the economic top 1% of the population.
The latest comprehensive look at wealth distribution data reveals that the “ultra-rich” economic top 0.01% of US households now has an all-time high 11.1% of overall wealth. The next tier, the 99.9% – 99.99% has 10.4%, and the top 99% – 99.9% has 18.3%. In total, the top 1% now has an all-time high 39.8% of wealth.
When we correlate wealth distribution percentages with the $82 trillion in overall wealth reported by the Federal Reserve, it reveals that the top .01% has a stunning $9.1 trillion in wealth. In total, the top 1% has a mind-blowing $32.6 trillion.
To begin to comprehend wealth of this magnitude, one trillion is equal to 1000 billion. $32.6 trillion written out is $32,600,000,000,000.00.
Having that much wealth consolidated within a mere 1% of the population, while a record number of people toil in poverty and debt, is a crime against humanity. For example, it would only cost 0.5% of the 1%’s wealth to eliminate poverty nationwide. Also consider that at least 40% of the 1%’s accounted for wealth is sitting idle. That’s an astonishing $13 trillion in wealth hoarded away, unused.
Once you truly understand how much $32.6 trillion is, and realize how just a fraction of that wealth could dramatically evolve society for the benefit of all, the argument for significant systemic change is solid. However, as scandalous as these statistics are, they do not factor in trillions of dollars more in unaccounted for offshore wealth, which makes the overall situation sound significantly better than it actually is and hides the true depth of the crisis from popular consciousness. (We will analyze hidden wealth in section 4.)
Looking toward the future, current trends reveal that the rate in which inequality is growing is increasing rapidly. Overall wealth increased by $1.5 trillion in the first quarter of 2014. If wealth keeps increasing at the current rate, there will be an increase of $6 trillion in 2014. How will this wealth be distributed? If you look at income gains since 2009, 95% of them have gone to the top 1%.
Three of my economics analyses: