Fund Managers Make Billions While American Workers Suffer
Conditions in America on this Labor Day are an insult to the men and women whose work keeps society functioning. In another time, there would be mobs in the street, stones would be crashing through shop windows and heads would roll – literally. But the world – the western world anyway – is more civilized now, more docile. Sometimes I wonder whether this meekness is a product of socialization or whether someone has drugged the nation’s drinking water.
Consider these findings from a report released today by the Rutgers University School of Management and Labor Relations:
More than 10 percent of Americans are unemployed, discouraged from seeking work or underemployed. That is a nearly 25-percent increase from one year earlier.
About 530,000 workers were subject to mass layoffs in the last year, a growth of nearly 5 percent.
The median weekly earnings for American workers have not grown in real terms over the last eight years.
At $6.55, the federal minimum wage is worth 40 cents less per hour, in inflation-adjusted dollars, than it was a decade ago.
Employer-assisted childcare and employee wellness programs cover less than one quarter of American workers.
Roughly 4 percent of the workforce are working part time because they can’t find full-time work.
Meanwhile, at a time when a record number of American families are losing their homes to foreclosure, the number of billionaires (with a b) in America has skyrocketed. Writing in CommonDreams.org today, Holly Sklar notes that “until 2005, multimillionaires could still make the Forbes list of the 400 richest Americans. In 2006, the Forbes 400 went to billionaires only. This year, you’d need a Forbes 482 to fit all the billionaires.”
The Forbes 400 minimum is $1.3 billion, Sklar said. And the average Forbes 400 member has $3.8 billion. “Since 2000, we have added 184 billionaires – and 5 million more people living below the poverty line.”
Sklar notes that when the Forbes 400 began in 1982, it was dominated by oil and manufacturing fortunes. Today, nearly half the 45 new members made their fortunes on Wall Street – in hedge funds and private equity.
Wealth is being redistributed from poorer to richer, Sklar points out. “Between 1983 and 2004, the average wealth of the top 1 percent of households grew by 78 percent, reports Edward Wolff, professor of economics at New York University. The bottom 40 percent lost 59 percent.”
In 1982, when the Forbes 400 had just 13 billionaires, the highest paid CEO made $108 million and the average full-time worker made $34,199, adjusted for inflation. Last year, the highest paid hedge fund manager hauled in $1.7 billion, the highest paid CEO made $647 million, and the average worker made $34,861, with vanishing health and pension coverage.
Sklar also observes that the Forbes 400 is even more of a rich men’s club than when it began. “The number of women has dropped from 75 in 1982 to 39 today.”
The article states that the 400 richest Americans have a conservatively estimated $1.54 trillion in combined wealth. “That amount is more than 11 percent of our $13.8 trillion Gross Domestic Product – the total annual value of goods and services produced by our nation of 303 million people. In 1982, Forbes 400 wealth measured less than 3 percent of U.S. GDP.”
And the rich, Sklar reported, “give away a smaller share of their income than the rest of us.”
Thanks to mega-tax cuts, the rich can afford more yachts, accessorized with helicopters and mini-submarines, Sklar writes. “Meanwhile, the infrastructure of bridges, levees, mass transit, parks and other public assets inherited from earlier generations of taxpayers crumbles from neglect, and the holes in the safety net are growing.”
Not since the 1920s has America experienced such blatant inequity.
Highly paid television commentators, radio talk show hosts and newspaper columnists talk condescendingly about the “working class.” And presidential candidate John McCain said recently that America’s middle class begins with families making less than $5 million a year.
Yet America’s “working class” seems content. Polls show voters evenly divided between McCain, who is expected to continue most of the policies of the past eight years, and Barack Obama, who has promised to end some tax breaks for the rich and ease the burden on those of us making less than $250,000 a year.
Do you wonder that I suspect there’s something in the water?