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THIS WEEK
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More than 50 years ago, Dr. Martin Luther King, Jr. led a protest movement from Selma to Montgomery, demanding voting rights for black people in a region known for its deadly racist violence. Now, in a county that falls just along the march trail, a storm of racism, inequality, and ecological devastation continues its hold over the state.
Last year, scientists found that the residents of Lowndes County, an impoverished, majority black part of Alabama, tested positive for hookworm at alarming rates. The disease, once thought to be eradicated in the United States, continues to thrive. Given America’s great wealth, why do the parasites of extreme poverty still plague the nation? Catherine Flowers, a Lowndes County native, has some answers, and this week we have more on her struggle to link inequality, racism, and environmental degradation.
We also take a look this week at a decade-long bet over the mega millions of dollars that hedge fund managers pocket. And we’ve added a new function to our newsletter: You can now easily share our graphics to Twitter, not just Facebook. Thanks to all our readers who suggested that improvement!
Chuck Collins, for the Institute for Policy Studies Inequality.org team |
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INEQUALITY BY THE NUMBERS
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FACES ON THE FRONTLINES
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| To Understand Inequality, Look Outside the Cities |
| You can’t count on your phone’s mapping app to guide you in rural Alabama, Catherine Flowers says. A Lowndes County native, Flowers recently had visitors who tried to find their way around using a GPS. The message they received from their device? That they were entering “uncharted territory.” Inside that “uncharted territory,” Flowers is now working to find sustainable solutions tailored to the problems facing rural areas in the Deep South. Inequality.org co-editor Negin Owliaei has more on Flowers and her work with the Poor People’s Campaign to bring environmental justice to Alabama. |
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WORDS OF WISDOM
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PETULANT PLUTOCRAT
OF THE WEEK
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| A Hedgie Who Just Can’t Afford to Be a Good Loser |
A decade ago, hedge fund manager Ted Seides bet investor Warren Buffett — a long-time critic of the mega millions in fees hedge fund managers pocket — that over the next ten years an investment in hedge funds would outperform an investment in a low-fee stock index fund. The bet ended at the New York Stock Exchange’s closing bell for 2017. Buffett won. Big. His low-fee index fund returned 7.1 percent annually, the Seides hedge fund investment just 2.2 percent. Seides actually conceded his likely loss last spring in a Bloomberg column that at first seemed a graceful admission of defeat. But the column quickly deteriorated into a strained checklist of excuses. The most bizarre: The S&P 500, Seides argued, had “defied the odds” and “rewarded investors with a historically normal” annualized return. Buffett’s bet, notes economist Bill Black, “tested the proposition” that hedge fund managers must be doing “something fantastic to warrant” the big bucks they rake in. The results neatly expose, Black adds, how “insane” investing with hedge fund “predators” has become.
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GREED AT A GLANCE
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TOO MUCH
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| Lucky Man? Or Ultra-Deserving Deep Pocket? |
| What separates the rich from the rest of us? The incredibly lucrative corporate career of Eric Schmidt, a top exec at Google since 2001, may offer some clues. Schmidt is stepping down later this month — with about $14 billion more to his name than he had before his Google tenure began. On the eve of his exit, a digital avalanche of kudos for Schmidt has already begun flowing. Many business observers simply see him as, at core, a real-deal “very stable genius.” How should we see Eric Schmidt — and billionaire execs just like him? Inequality.org co-editor Sam Pizzigati has more. |
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MUST READS
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This week on Inequality.org:
Sarah Anderson, Video: Corporations Cutting Jobs After Tax Cut. Big companies are splurging on stock buybacks rather than job-creating investments.
Josh Hoxie, Move Along, Baby Boomers. You’ve Done Enough. In the face of countless crises, it’s time for the next generation to lead.
Stefan Stern, The Unfinished Business of CEO Pay Reform in the UK. More action is needed to fix the country’s broken executive compensation system.
Elsewhere on the web:
Josh Hoxie, I Live in a ‘Shithole Country.’ It’s Called the United States. Fortune. Donald Trump should take a look at how the country he leads treats its most vulnerable people before he denigrates the rest of the world.
Kareem Abdul-Jabbar, It's time to pay the tab for America's college athletes, The Guardian. Top coaches take home millions. College athletes get no wages at all.
Branko Milanovic, What these early-20th-century scholars got right about 21st-century politics, Vox. Unlike many economists today, many leading economists a century ago questioned fundamental social structure and income distribution.
Dean Baker, The Washington Post Discovers the Stock Market Is Not the Economy, Beat the Press. Higher stock prices amount to great news for the small share of the population with large stock holdings. The main impact for everyone else: higher house prices and rents as richer stockholders bid up prices.
Alex Shephard, Donald Trump, Davos Man, The New Republic. Why a supposed economic populist will fit right in at the annual global conference for the ultra elite.
Elizabeth Kolbert, The Psychology of Inequality, The New Yorker. A society where economic gains concentrate at the top has no real winners and a multitude of losers.
Leo Gerard, Fat Cat Tuesday: A Commemoration of CEO Excess, Alternet. It takes two days for the typical Fortune 500 CEO to pocket the median American salary for a whole year. |
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