How the 1% profit off of racial economic inequality: While the wealth of billionaires increased by $900 billion last year, or $2.5 billion a day, bottom 50% saw its wealth decline by 11 percent

“People generally are beginning to realize that they have been sold a bad bill of goods,” said Paul O’Brien, vice president for policy and campaigns at Oxfam America. (Photo: Market Watch via Getty Images)

With Wall Street titans, tech moguls, and other members of the global financial and political elite set to gather in Davos, Switzerland this week for the annual World Economic Forum, a report published late Sunday found that the planet’s richest people saw their fortunes soar by $2.5 billion per day last year as the world’s poorest lost wealth.

“The economy we have today is fundamentally inhuman.”
—Paul O’Brien, Oxfam America

Titled “Private Good or Public Wealth?” and conducted by Oxfam, the new analysis found that 26 billionaires now own as much wealth as the world’s poorest 3.8 billion people combined.

According to Oxfam, the number of billionaires has doubled since the global financial crisis of 2008, even as average families have struggled mightily to recover.

In contrast to the soaring fortunes of the global financial elite, the wealth of the world’s poorest fell by $500 million each day in 2018—an overall decline of 11 percent.

“The economy we have today is fundamentally inhuman,” Paul O’Brien, vice president for policy and campaigns at Oxfam America, said in an interview with the Huffington Post.

Singling out U.S. President Donald Trump and the Republican Party’s $1.5 trillion in tax cuts for the rich as the kind of upward redistribution that has worsened inequality at the expense of the world’s poor and working class, O’Brien said that only transformative political and economic changes across the globe will be sufficient to close the gap between the rich and everyone else.

“Inequality is not inevitable, it’s a political choice.”

“The recent U.S. tax law is a master class on how to favor massive corporations and the richest citizens,” O’Brien said in a statement. “The law rewards U.S. companies that have trillions stashed offshore, encourages U.S. companies to dodge foreign taxes on their foreign profits, and fuels a global race to the bottom that benefits big business and wealthy individuals.”

“The only winners in the race to the bottom on corporate tax are the wealthiest among us. Now is the time to work towards a new set of tax rules that work for the many, not the few,” he continued, echoing the popular slogans of U.S. Sen. Bernie Sanders (I-Vt.) and U.K. Labour leader Jeremy Corbyn. “We need economic, political, and tax reform to level the playing field if we want to restore prosperity and opportunity for all, including women, girls whose needs are so often overlooked.” Citing United Nations figures, Oxfam points out that crucial public services throughout the world—including in wealthy nations like the U.S. and the U.K.—are suffering from crippling austerity as the global financial elite and massive corporations hoard economic gains, thanks in large part to regressive government policies that allow them to pay minimal taxes and enrich executives with massive pay packages.

Meanwhile, workers are forced to scrape by on starvation wages.

“People generally are beginning to realize that they have been sold a bad bill of goods,” O’Brien said. “Today, 262 million kids are going to stay home because there is no funding for their education, 10,000 people today will die because they don’t have access to basic healthcare that could easily be funded through proper fiscal systems.”

Oxfam’s analysis concludes that only a “human economy” that guarantees essential services like healthcare, education, and housing to all—funded by higher taxes on the ultra-rich—can begin to resolve the inequities that are producing mass suffering and threatening the existence of the planet.

According to Oxfam, “if the richest one percent paid an additional 0.5 percent tax on their wealth, an estimated $418 billion would be raised a year. This alone would ensure an education for the 262 million children currently not in school and provide healthcare that could save the lives of more than three million people.”

“Inequality is not inevitable,” Oxfam’s report concludes, “it’s a political choice.”

wall street
 ‘The 1% percent are profiting off ongoing racial economic inequality.’ Photograph: Shannon Stapleton/Reuters

An economy that’s rigged to benefit the richest 1% has left most of America behind. While wages for workers have remained flat for decades, expenses for health care, housing, and most basic needs have risen. Alongside record concentrations of income and wealth at the top, America’s racial wealth divide has persisted – or worsened.

As people of color make up a larger share of the diversifying US population, that persistent racial wealth divide is bringing down America’s median wealth. But while wealth at the middle falters, it’s skyrocketing at the top.

In other words, the 1% are profiting off ongoing racial economic inequality.

All this is happening against a backdrop of seemingly good economic news. Black and Latino unemployment rates reached historic lows in 2018, and median income has slowly inched up for all households in the last few years.

But measures of wealth – what you own minus what you owe – tell a very different story. Those were our findings in Dreams Deferred, a new study on the racial wealth divide for the Institute for Policy Studies.

Since the early 1980s, median wealth among Black and Latino families has been stuck at less than $10,000. The median Black family today owns $3,600 – just 2% of the $147,000 of wealth the median white family owns. The median Latino family has assets worth $6,600 – just 4% of the median white family.

In other words, the median white family has 41 times more wealth than the median Black family and 22 times more wealth than the median Latino family.

“Median wealth” refers to the household at the exact middle of wealth distribution – with half of households above and half below. That’s different from “average wealth”, which skews the numbers by including the wealth of the richest 1%. (Average white wealth, for example, was $930,000 in 2016. But the ordinary white person isn’t close to being a millionaire.)

Changes in median wealth give us a multi-decade understanding of economic security and well-being. Since 1983, median wealth for all US households declined by 3%, adjusting for inflation. Over this same period, the median Black family saw their wealth drop by more than half.

Meanwhile, the number of households with $10m or more skyrocketed by 856%.

If the trajectory of the past three decades continues, by 2050 the median white family will have $174,000 of wealth, while Latino median wealth will be just $8,600 – and Black median wealth will head downward to $600. In fact, the median Black family is on track to reach zero wealth by 2082.

While the middle stagnates and the very top skyrockets away, there’s also surging growth at the bottom end of the spectrum.

A growing number of households are “underwater” when it comes to wealth. The proportion of all US households – of any race – with zero or “negative” wealth (meaning their debts exceed the value of their assets) has grown from one in six in 1983 to one in five households today.  

Families of color are much likelier to be in this precarious financial situation. 37% of Black families and 33% of Latino families have zero or negative wealth, compared to just 15.5% of white families.

These racial wealth divisions are damaging to the economy as a whole. Low levels of Black and Latino wealth, combined with their growing proportion of the population, are a significant contributor to the overall decline in American median household wealth.

Meanwhile, efforts to close the racial economic divide have been thwarted by the larger economic inequalities surging through the economy. Billionaire-bankrolled outfits like the Koch network, for example, have invested heavily in politicians that have made the tax code more unequal than ever.

Public policies aimed at reducing both overall inequality and the racial wealth divide in particular will be critical to creating a more equitable economic system. Such policies could include the expansion of first-time homeownership programs and the creation of a “baby bond” program, to seed an asset account for each newborn.

But we also must address the overall challenges of inequality with policies to raise the minimum wage and expand health care, while taxing the 1% to fund education and infrastructure that create an economy that works for everyone, not just the super-rich.

Dedrick Asante-Muhammad and Chuck Collins are co-authors of the report, with Josh Hoxie and Sabrina Terry, Dream Deferred: How Enriching the 1 Percent Widens the Racial Wealth Divide, published by the Institute for Policy Studies

MLK Quotes:


  • “I imagine you already know that I am much more socialistic in my economic theory than capitalistic… [Capitalism] started out with a noble and high motive… but like most human systems it fell victim to the very thing it was revolting against. So today capitalism has out-lived its usefulness.” – Letter to Coretta Scott, July 18, 1952.
  • “In a sense, you could say we’re involved in the class struggle.” –Quote to New York Times reporter, José Igelsias, 1968.
  • “And one day we must ask the question, ‘Why are there forty million poor people in America? And when you begin to ask that question, you are raising questions about the economic system, about a broader distribution of wealth.’ When you ask that question, you begin to question the capitalistic economy. And I’m simply saying that more and more, we’ve got to begin to ask questions about the whole society…” –Speech to Southern Christian Leadership Conference Atlanta, Georgia, August 16, 1967.
  • “Capitalism forgets that life is social. And the kingdom of brotherhood is found neither in the thesis of communism nor the antithesis of capitalism, but in a higher synthesis.” –Speech to Southern Christian Leadership Conference Atlanta, Georgia, August 16, 1967.
  • “Call it democracy, or call it democratic socialism, but there must be a better distribution of wealth within this country for all God’s children.” – Speech to the Negro American Labor Council, 1961.
  • “We must recognize that we can’t solve our problem now until there is a radical redistribution of economic and political power… this means a revolution of values and other things. We must see now that the evils of racism, economic exploitation and militarism are all tied together… you can’t really get rid of one without getting rid of the others… the whole structure of American life must be changed. America is a hypocritical nation and [we] must put [our] own house in order.”– Report to SCLC Staff, May 1967.
  • “The evils of capitalism are as real as the evils of militarism and evils of racism.” –Speech to SCLC  Board, March 30, 1967.
  • “I am now convinced that the simplest approach will prove to be the most effective – the solution to poverty is to abolish it directly by a now widely discussed matter: the guaranteed income… The curse of poverty has no justification in our age. It is socially as cruel and blind as the practice of cannibalism at the dawn of civilization, when men ate each other because they had not yet learned to take food from the soil or to consume the abundant animal life around them. The time has come for us to civilize ourselves by the total, direct and immediate abolition of poverty.” – Where do We Go from Here?, 1967.
  • “You can’t talk about solving the economic problem of the Negro without talking about billions of dollars. You can’t talk about ending the slums without first saying profit must be taken out of slums. You’re really tampering and getting on dangerous ground because you are messing with folk then. You are messing with captains of industry. Now this means that we are treading in difficult water, because it really means that we are saying that something is wrong with capitalism.” – Speech to his staff, 1966.
  • “[W]e are saying that something is wrong … with capitalism…. There must be better distribution of wealth and maybe America must move toward a democratic socialism.” – Speech to his staff, 1966.
  • “If America does not use her vast resources of wealth to end poverty and make it possible for all of God’s children to have the basic necessities of life, she too will go to hell.” Speech at Bishop Charles Mason Temple of the Church of God in Christ in support of the Memphis sanitation workers’ strike on March 18th, 1968, two weeks before he was assassinated.



GOP lawmaker actually claims that whites were lynched in ‘nearly equal numbers’ to blacks ‘for being Republican’

GOP lawmaker actually claims that whites were lynched in ‘nearly equal numbers’ to blacks ‘for being Republican’

On Monday, a GOP state representative in Colorado decided to celebrate Martin Luther King Day by posting a video to Facebook from the state House floor, during which she shared…

“We have come a long way on that arc since the reconstruction, when whites and blacks alike were in nearly equal numbers lynched for the crime of being Republican,” said Rep. Lori Saine, who originally gave the speech on Friday:

Saine claims that she gave the speech in part to protest to the chamber’s refusal to allow a fellow Republican, Rep. Perry Buck, to consider her resolution honoring Dr. King, which she claims was because the civil rights icon “didn’t represent her heritage.” Both Saine and Buck, however, were permitted to cosponsor the resolution put forth by Democratic Reps. Jovan Melton and Leslie Herod.

Saine is badly wrong on the facts of lynching. According to the NAACP, of the 4,743 recorded lynchings between 1882 and 1968, 72.7 percent of victims were black.

Additionally, it is wrong to say that these people were lynched for “being Republican” — they were mostly lynched for pursuing or supporting black civil rights, or to send a message to those who did. Many of them may well have been Republicans, which in the Reconstruction era was the party pushing civil rights. But the party has a substantially different membership base and platform today than it did back then.

Saine is a colorful figure in Colorado politics, having been arrested in 2017 for allegedly carrying a gun into Denver International Airport. No charges were ultimately filed.