| THIS WEEK |
The United States has recently reached the grimmest of milestones: over 500,000 dead since Covid-19 hit big-time last winter. That total amounts to about one death per every 670 living Americans. And that 670 eerily approximates the exact number of U.S. billionaires: 664.
These 664 billionaires have reaped a tremendous windfall during this global pandemic. The combined fortunes of these incredibly privileged few have increased, our latest Inequality.org billionaire wealth update details, by an astounding 44 percent since last March. Meanwhile, millions of the frontline workers risking their lives to provide essential services during this time of national crisis are earning less than a living wage.
How can this be? Are billionaires taking greater risks or sacrificing more than our essential workers? Do our already fantastically wealthy billionaires somehow deserve many billions more at a time when frontline employees are struggling through a pandemic to provide for themselves and their families? Of course not.
As we publish this week, Senator Elizabeth Warren is releasing her new wealth tax legislation, the Ultra-Millionaire Tax. We’ve done an analysis of this proposal with our Americans for Tax Fairness colleagues. If this levy had been in place in 2020, our analysis shows, America’s billionaires would have last year faced an additional $114 billion in tax!
We need bold action like this new initiative to flip the switch on the system that’s allowed pervasive, destructive inequality to run unchecked for decades. More below this week on what other steps could be.
Chuck Collins and Rebekah Entralgo,
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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| Danny Glover Standing Tall with Amazon Workers |
| Famed actor Danny Glover traveled to Alabama last week to show solidarity with workers who could soon make history as the first U.S. Amazon employees to unionize. The Hollywood star decided to make the trek after the e-commerce giant deployed a barrage of intimidation tactics to turn workers against the union. Glover has just spelled out his concerns in an exclusive interview with Inequality.org co-editor Sarah Anderson: “We’re seeing all the draconian, ugly ways that corporations demonize the idea of organized labor. We simply have to stop glorifying the billionaires who are trying any way they can to disempower workers.” |
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| WORDS OF WISDOM |
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PETULANT PLUTOCRAT
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| ‘Public Service’ as Fast Track to Billionaire Fortune |
| Former Goldman Sachs and hedge fund heavy Steven Mnuchin couldn’t pocket, during his years as Donald Trump’s treasury secretary, the sorts of Wall Street windfalls that had made him a $400-million personal fortune. But he sure seems to have used those years to set himself up nicely for life after Trump. Press reports last week revealed that Mnuchin is now starting up an investment fund that’s counting on cash from Saudi Arabia. Mnuchin conveniently spent a chunk of his last month in office on a Middle East diplomatic trip. Did he spend that time reminding Saudis of his services rendered over the past four years? Like the time he gave the Saudi crown prince an official visit amid the furor over the prince’s role in the murder of Saudi dissident Jamal Khashoggi. Or his help making sure team Trump backed the Saudi war on Yemen. Mnuchin himself is refusing to take questions on his new Saudi dealings. He’s also not worrying about how his new venture looks. His pal Donald, before exiting office, rescinded ethics rules that would have complicated Mnuchin’s new gig. |
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| BOLD SOLUTIONS |
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| Time to End Financial Policy’s Pauper-Prince Effect |
| Economic inequality at its root revolves around money and nothing moves money as powerfully as monetary and regulatory policies. Over recent years, those policies have brought us ultra-low interest rates that have made paupers of savers and princes of stock-market investors. With rates at or below zero, everything from saving for a home down payment to building an adequate financial cushion for unexpected expenses has become simply impossible for most Americans. In her new book, Engine of Inequality: The Fed and the Future of Wealth in America, Karen Petrou explains how we can use financial policy tools to start throwing the inequality engine in reverse. |
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| GREED AT A GLANCE |
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| TOO MUCH |
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| A Wealth Tax? The United States Already Has One |
| Might the United States, home to the world’s wealthiest people, sometime soon sport a tax on wealth? Media outlets the nation over have begun speculating on just that question. But many of these reflections are missing the point: The United States already has a wealth tax. We call this already existing levy the “property tax,” and almost all Americans feel its pinch — with one exception. The rich. Our current Rube Goldberg-mess of a tax system has America’s poorer half paying an annual tax on over half its wealth and America’s top 1 percent paying no annual tax on almost 90 percent of its wealth. None of this makes sense. Inequality.org co-editor Sam Pizzigati has more. |
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| MUST READS |
This week on Inequality.org
Chuck Collins, Time for the Warren-Jayapal Wealth Tax. Billionaires have reaped tremendous gains during the pandemic. A wealth tax will slow the build-up of democracy-distorting concentrations of wealth and power.
Kayla Soren, Small Towns and Rural Communities Need Transit, Too. Millions of rural Americans don’t have a car. With the pandemic battering transit agencies, they’re finding themselves totally isolated.
Chuck Collins and Omar Ocampo, Financial Reserves and the Racial Wealth Gap. Black and Latino households have less to fall back on when the times get tough.
Elsewhere on the Web
Alex Cobham, A tide-turning moment in the global struggle for tax justice, Tax Justice Network. A high-level UN panel has endorsed a comprehensive slate of reforms strong enough to recoup the estimated $427 billion the global super rich dodge in taxes every year.
Steve Wamhoff, Enacting a Federal Wealth Tax Is Playing the Long Game, JustTaxes. Opponents of a federal wealth tax are relying on clauses included in the Constitution to broker the compromise that allowed slavery to continue for years.
Diego Laje and Anthony Faiola, Should the rich pay for the pandemic? Argentina thinks so. Other countries are taking a look, Washington Post. Argentina has adopted a one-time special levy on the rich, 3.5 percent of net worth of citizens who hold over $3.4 million. Bolivia and Morrocco have taken similar steps.
Brian Kahn, Billionaires’ Favorite Climate Solution Is a Dangerous Distraction, Gizmodo. Rich white guys giving out prizes for suspect science subverts democratic input on one of the most consequential issues humanity has ever faced — and cements rising inequality.
Luke Hildyard, The bankers are bluffing, don’t scrap the bonus cap, Left Foot Forward. In 2019, the UK banking giant Barclays had 448 employees paid over £1 million and 27,000 less than £25k. Redistributing pay from high- to low-paid employees could result in better outcomes for the latter while the former would remain extraordinarily well-rewarded.
Dana Hull, How the Rich Can Escape America's Unreliable Power Grid, Bloomberg. A basic truth of American life today: Lots of rich folk don’t particularly worry about our failing infrastructure. They can easily afford to go it alone.
Ben Tippet, Another ‘Roaring Twenties’? Only if the rich pay their fair share, Open Democracy. In recent years the Overton window has decisively shifted on wealth taxes. A decade ago, progressive wealth taxes seemed a fringe idea. Not anymore.
William Cohan, “The Money Is Too Good to Pass Up”: Wall Street Isn’t Letting Khashoggi’s Killing Get in the Way of Saudi Business, Vanity Fair. CEOs flocked to last month’s “Davos in the Desert” and surely won’t let this week’s release of intelligence directly linking MBS to the journalist’s murder slow down the Saudi-Wall Street gravy train. |
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| A FINAL FIGURE |
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| BE THE 1% (NO, NOT THAT 1%) |
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Our goal for 2021: that 1% of our Inequality.org subscribers become monthly sustainers and help grow our newsletter and research efforts. Be the 1%, for as little as $3 a month! |
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