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
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.
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.
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.
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.
At a time of massive income and wealth inequality, with the very rich getting much richer while working families face increased desperation, Walmart and its owners, the Walton family, have become the poster children for corporate greed.
And it is time that we stood up to that greed and the unfettered capitalism which sustains it.
Here is the reality. The Walton family is the wealthiest family in the country and is worth more than $200 billion, which is more than the bottom 40 percent of Americans combined. Yet somehow, they continue to oppose the idea of paying their workers a living wage of $15 an hour. They think the taxpayers in this country should have to subsidize the needs of their low wage workers who are forced to go on food stamps, Medicaid and other forms of public assistance.
This is a family that has made more than $50 billion during the pandemic – yet many of their workers reported going into work without the protective gear they needed during that same pandemic, and few have any paid leave they can use.
This is a family whose eldest son has spent more than $225 million on an antique car collection, including Ferraris, Porches, Maseratis, and a 1936 Bugatti Type 57SC Atlantic that won top prize at the The Peninsula Classics Best of the Best Award in Paris — yet 55 percent of Walmart’s hourly workers have reported struggling with hunger.
This is a family with another heir to the Walmart fortune, Alice, who has amassed a private art collection worth an estimated $500 million, a $25 million two-floor condo on New York’s Park Avenue with 52 windows overlooking Central Park, and a $22 million 4,400-acre ranch in Texas — yet tens of thousands of Walmart workers are forced to rely on food stamps and public housing in order to survive.
Now, I have never understood how one family could have so much money and feel the desperate need for even more. I would think that with all those cars and homes and cash, they might just be able to raise the wages of their employees to a living wage and still afford to get by.
Because the greed above just scratches the surface of the Walmart family’s pathology.
In 2005, Walmart was forced to settle a child labor law case. That same year, they paid a settlement for denying workers meal breaks.
In 2016, they were found to have used sweatshop labor.
In 2017, they were sued by female employees for discrimination based on gender.
And here is something else you may not know:
The Walmart family — despite all of their wealth — is the largest welfare recipient in the country.
While they make these huge profits, buy their cars, their art, their homes, and more, they pay their workers wages that are so low that Walmart workers need distressing levels of public assistance just to get by.
A 2020 study by the Government Accountability Office found that in Arkansas, where Walmart was founded and has its headquarters, 1,318 workers receive SNAP benefits, which is 3.1 percent of the state’s total SNAP recipients. And another report showed that in 2013, Walmart cost taxpayers more than $6 billion in taxpayer-funded public assistance — and just four years later, for good measure, Walmart gave more than $8 billion in stock buybacks.
This is all possible because of the low wages they pay their workers, and compliments of U.S. taxpayers.
So to the Walton family, I say to you, maybe you cannot understand what it is like to make $11 or $12 an hour in this country, but your workers need a raise. No one can live in dignity working a full-time job at those wages.
Amazon raised its minimum wage to $15 an hour.
Costco has raised its minimum wage to $16 an hour.
And it’s time for Walmart to do the right thing as well.
As Americans, we must ask ourselves one fundamental question, and that is whether or not this is the kind of country and economic culture we are comfortable with.