It’s been over 10 years since the “great recession.” Since then, we had a period of modest growth, followed by a depression. Let’s catch up with the Billionaires and how they have been doing since 2009. Like this Russian family, who tried to get richer just before the pandemic struck.
In 2009, the world had 793 billionaires with a combined wealth of $2.4 trillion. There were 98 members of a more exclusive club: $5 billion or more.
As of 2019, the world had 2,153 billionaires with a total net worth of $8.7 trillion. Membership of the $5 billion club quadrupled since 2009 to 424, and 166 people now have at least $10 billion.
To qualify as one of the world’s 100 richest people, you now need a minimum net worth of $14.4 Billion. Ten years ago it was $4.9 Billion.
Karl Marx pointed out in Das Kapital the capitalism was the most successful economic system yet devised, if measured by the ability to create vast quantities of wealth. It was in distribution of wealth that capitalism failed spectacularly . Only when government heavily taxes concentrated wealth, and redistributes it through public programs like universal health care , free public education through college, massive, job-creating infrastructure spending and the like, does capitalism produce a system in which every social class sees a steady rise in income and living standards. The United States had such a system for both corporations and individuals between 1945 and 1980. The rich, as always, got richer, but a huge middle class was created, and with relatively few exceptions, the general standard of living improved in every category. This period came to a crashing end with Reagan, who pursued an unambiguous policy of transferring wealth to the very top of the income scale through huge tax cuts, the evisceration of labor unions, and draconian cuts in redistribution programs. And so here we are. The wealthy waged war on the rest of us, and they won.
In the Trump years, corporations were known for having too much cash and too few investments. It wasn’t a big economic boom as the GOP says. It was a time of amassing cash and not hiring people.
The French economist, Thomas Pickety, wrote a well received book a few years ago that thoroughly analyzed the reasons that capitalism tends to create ever greater wealth and income inequality. The short answer is because, absent a tax policy directly aimed at redistribution, the investor class will do what it's currently doing. Unchallenged by strong unions, which would give workers some leverage in demanding higher wages and benefits, and coddled by a tax cutting and corporate contribution dependent government, investors can simply keep more and more of the earnings that increased productivity and inexpensive labor created. Of course the capitalists keep nearly all of the wealth created in the economy. It isn't taxed for redistribution to the society that makes it possible, and it doesn't go to increased wages and salaries, because workers have no bargaining power. The rich inevitably get richer, and that will not change unless fundamental social and political changes take place. Between 1945 and 1980, the west kept taxes, especially on the rich, very high, and pursued policies which strengthened unions and redistributed wealth through increased home ownership and educational opportunities. But with Reagan and Thatcher, all that changed. Massive tax cuts benefited the already rich, unions were deliberately decimated, good jobs were shipped to low wage countries, and the inherent tendencies of capitalism toward ever greater concentration of wealth at the top reappeared. As Yogi Berra once said, it's like deja vu all over again.
