| THIS WEEK |
What would you do if your total wealth increased by $138 billion during a global pandemic? If you’re Tesla founder Elon Musk, you buy a ticket to space on fellow billionaire Richard Branson’s spaceship!
According to new research from our Inequality team and the Americans for Tax Fairness team, the $138 billion windfall Musk has reaped during the global pandemic could cover the ten-year costs of tuition for 5.5 million community college students and feed 29 million low-income public school kids over summer breaks — and still leave Musk $4 billion richer than before Covid struck.
In fact, the total wealth of U.S. billionaires during the pandemic has soared by $1.8 trillion, an increase of over 60 percent. Those gains could almost entirely pay for President Biden’s American Families Plan, a gameplan for providing vital investments in education, health care, and much much more for tens of millions of Americans.
We need an agenda that taxes the wealthy to fund vital public investments and reverse extreme economic inequality. That sort of agenda worked to end the original Gilded Age. We can repeat that success.
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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| Fighting Private Equity Landlords in New York City |
| New York’s iconic, soaring skyscrapers give home to few. Far too many New Yorkers have unaffordable, untenable buildings as their only housing option. These extremes represent New York’s rampant inequality — and fuel its tenacious housing justice movement. Tenants and organizers across New York have been working to end the boom-and-bust cycle of private equity landlord profiteering, displacement, and homelessness. Through the Housing Justice for All Coalition, tenants have been sharing their stories, boldly lobbying elected officials, and highlighting the destructive political role of the real estate industry. Now they’ve won some of the nation’s strongest tenant protections. We spoke with Winsome Pendergrass and Cea Weaver, leaders in the Housing Justice for All Coalition, about their work, legislative victories, and the future of fair housing. |
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| WORDS OF WISDOM |
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PETULANT PLUTOCRAT
OF THE WEEK |
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| Another Exec Working Not So Hard for His Money |
| Wall Street whizzes like David Hamamoto, a former Goldman Sachs exec now running his own investment operation, would like us to believe they work ever so hard at “due diligence,” thoroughly investigating the businesses they put other people’s money into. Hamamoto raised $250 million of that money for the “special purpose acquisition company,” or SPAC, he launched two years ago. SPACs have become a trendy Wall Street speculative vehicle for turning start-ups into publicly traded companies via the merger route. The object of Hamamoto’s SPAC affection: Lordstown Motors, an electric truck start-up with a flamboyant CEO who claimed last June his company had 20,000 advance orders, then upped that figure to 50,000 in November and 100,000 in January. In reality, Lordstown Motors had precious little in pledges, and the CEO, Steve Burns, resigned last month, crashing the company’s share price. Hamamoto’s “due diligence” on Burns, a New York Times analysis has just revealed, boiled down to not all that much more than a Google search. Hamomoto refused to be interviewed for the Times story. |
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| BOLD SOLUTIONS |
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| Contracting for Economic and Racial Equity |
| If Congress passes President Biden’s Build Back Better plans, private firms will receive a huge infusion of taxpayer dollars to strengthen our nation’s infrastructure and speed the transition to clean-energy technologies. By strategically wielding the power of the public purse, we can push these companies to raise the bar for corporate citizenship, too. A new House bill, the Patriotic Corporations Act, would impose conditions on contractors that lift up workers and reduce economic inequality, including the CEO-worker pay gap. Bad corporate actors that contribute to race and gender inequality, violate environmental protections, and dodge taxes would have a hard time getting a federal contract if this exciting legislation becomes law. Sarah Anderson has more. |
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| GREED AT A GLANCE |
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| TOO MUCH |
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| Our Billionaires Are Blasting Off. Good Riddance! |
| Three of the richest billionaires on Earth are now busily spending billions to exit our Earth’s atmosphere and enter into space. The world is watching — and reflecting. Some commentators see our billionaire trio — Richard Branson, Jeff Bezos, and Elon Musk — as the heroic heirs to great explorers past. But most of our commentators seem to be taking a more skeptical perspective. They’re treating the “space race” as a wake-up call, a reminder that we don’t only get billionaires when wealth concentrates. We get a society that revolves around the egos of the most affluent among us and an economy where the needs of average people go unmet. Inequality.org co-editor Sam Pizzigati has more. |
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| MUST READS |
This week on Inequality.org
Manuel Perez-Rocha, Excessive Corporate Power Breeds Political Repression. In the face of extractive industries' enormous economic clout, Central Americans are facing increasing displacement and threats to their democratic rights.
Shailly Gupta Barnes, In the World's Wealthiest Country, We Can Go Further Than Biden's Build Back Better Plans. By raising taxes on the wealthy and redirecting other public resources, we can meet everyone’s needs and strengthen our economy.
Sarah Anderson and Bob Lord, Sports Teams: The Everlasting Tax Shelter for Billionaires. A perverse loophole allows owners of profitable teams — and their heirs — to lower their tax bills by claiming huge paper losses.
Chuck Collins, Billionaire Pandemic Wealth Gain Could Pay For Biden's American Families Plan. U.S. billionaires have reaped $1.8 trillion in wealth gains since March 2020.
Bella DeVaan, In Gossip Girl's Reboot, Wealthy Teens Grapple With Their Privilege. Is That Enough?. The classic teen drama returns, this time with class consciousness.
Brian Wakamo, Sarah Anderson, and Justin Campos, 11 Charts on Taxing the Wealthy and Corporations. Here's everything you need to know about the urgency of fair tax reforms to pay for vital public investments and reverse extreme inequality.
Rebekah Entralgo, Infrastructure Must Include the Care Economy. This crisis of care could be prevented if Congress were to take bold action to fund human infrastructure.
Chuck Collins and Helen Flannery, What Americans for Prosperity Foundation v. Bonta Means for Charities — and Our Democracy. A new Supreme Court decision enables billionaires to anonymously weaponize their philanthropy.
Elsewhere on the Web
Editorial Board, The U.S. is growing more unequal. That’s harmful — and fixable, Washington Post. America’s contemporary wealth concentration rests on financial windfalls, speculation, and inherited privilege.
Richard Murphy, The increase in wealth inequality during Covid is not an accident: it is a design fault that needs to be corrected, Tax Research UK. The obvious answer: We need to tax wealth more.
Hamilton Nolan, What happens at Sun Valley, the secret gathering of unelected billionaire kings? Guardian. Like Davos, the annual Sun Valley conference in Idaho functions as a mechanism for the concentration of wealth, dressed up as something friendlier.
Patrick Kennedy, Top Minnesota public company CEO pay up more than 70% this year, Star Tribune. Over the course of the horrific 2020 pandemic year, the CEO at Target pocketed $77.5 million.
Sophie Gilbert, The Awful Secret of Wealth Privilege, Atlantic. A new must-see TV series uncovers the curse of the privileged: They would rather be miserable than lose even a fraction of the things they have.
Patrick Radden Keefe, This Is What Billionaire Justice Looks Like, New York Times. The billionaire Sackler family will actually be richer nine years from now, under the pending lawsuit deal, even after paying $4.5 billion to settle all the opioid claims now pending against it.
Rachel Louise Ensign and Richard Rubin, Buy, Borrow, Die: How Rich Americans Live Off Their Paper Wealth, Wall Street Journal. Wall Street firms offer clients sitting on over $100 million in stock assets loans with annual interest rates as low as 0.87 percent.
Chuck Marr, ProPublica Shows How Little the Wealthiest Pay in Taxes: Policymakers Should Respond Accordingly, Center on Budget and Policy Priorities. The income tax has essentially become voluntary for the nation’s richest people.
Steve Wamhoff, Opposition to Biden’s Tax Plan Has Nothing to Do with Small Businesses or Family Farms, JustTaxes. Opponents of the Biden plans to stop billionaires from avoiding taxes know that they can’t win a fair debate. So they make bogus claims instead about how the proposals would hurt family farmers and businesspeople. |
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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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