In May 28 IssueBy John Thompson, Columnist
Last week I began a two part column which comes directly from a paper by David DeGraw entitled "The Economic Elite vs. The People of the USA." This weeks column concludes the report. It has been altered only in that some, less salient points, have been left out for space sake. It was also pointed out that the report was written in early 2010, so when he's talking about the year, just be aware he is talking about last year or the year before.
Yet the information is still startling, and has actually only gotten worse since then. I said this last week; and I wish this would truly sink in as our county debate "austerity" measures, meaning the people must suffer, yet LAST YEAR OUR COUNTRIES BILLIONAIRES ADDED ONE TRILLION ($1,000,000,000,000) TO THEIR BANK ACCOUNTS. One trillion…. Think that would help with the debt? Maybe since they're already billionaires they'd be willing to help on the debt? Nah… but all we hear, and unfortunately it's echoed by the poor lowly folk like you and me, is that our country is broke and that we have to "reform" (reform means destroy social safety nets) our "entitlement" programs.
Before I finish the report by DeGraw, I want to make note of the passing of David Davenport. I did not know Dave well. When The Times Journal acquired The Russell Register in November it was honestly the first time I had ever spoken to the man. What he showed me in the next few months gave me reason to admire him.
There were only a few months between the acquisition of the paper and the notable absence of Dave from the daily goings on of the paper. But during that time he was an incredibly generous man. He really gave to the staff at the Times Journal, and I took note of it right away. He made me feel like a welcomed member of the staff right away and was most likely the most easy-going boss I have ever had. He was the kind of boss that, as long as the work was done, he wasn't too concerned with the "clock in, clock out" mentality. He seemed to not sweat the small stuff. And I am going to speculate that when you're facing your own mortality straight on, indeed most everything else is the small stuff.
Dave was good to me in the very short time I knew him, and I will, and already do miss him and wish I had an opportunity to get to know him better.
Now for the rest of the condensed report by David DeGraw:
As a record amount of U.S. citizens are struggling to get by, many of the largest corporations are experiencing record-breaking profits, and CEOs are receiving record-breaking bonuses. How could this be happening, how did we get to this point?
The Economic Elite have escalated their attack on U.S. workers over the past few years; however, this attack began to build intensity in the 1970s. In 1970, CEOs made $25 for every $1 the average worker made. Due to technological advancements, production and profit levels exploded from 1970 - 2000. With the lion's share of increased profits going to the CEO's, this pay ratio dramatically rose to $90 for CEOs to $1 for the average worker.
As ridiculous as that seems, an in-depth study in 2004 on the explosion of CEO pay revealed that, including stock options and other benefits, CEO pay is more accurately $500 to $1.
Paul Buchheit, from DePaul University, revealed, "From 1980 to 2006 the richest 1 percent of America tripled their after-tax percentage of our nation's total income, while the bottom 90 percent have seen their share drop over 20 percent." Robert Freeman added, "Between 2002 and 2006, it was even worse: an astounding three-quarters of all the economy's growth was captured by the top 1 percent."
Due to this, the United States already had the highest inequality of wealth in the industrialized world prior to the financial crisis. Since the crisis, which has hit the average worker much harder than CEOs, the gap between the top one percent and the remaining 99 percent of the US population has grown to a record high. The economic top one percent of the population now owns over 70 percent of all financial assets, an all time record.
As mentioned before, just look at the first full year of the crisis when workers lost an average of 25 percent off their 401k. During the same time period, the wealth of the 400 richest Americans increased by $30 billion, bringing their total combined wealth to $1.57 trillion, which is more than the combined net worth of 50 percent of the US population. Just to make this point clear, 400 people have more wealth than 155 million people combined.
Meanwhile, 2009 was a record-breaking year for Wall Street bonuses, as firms issued $150 billion to their executives. 100 percent of these bonuses are a direct result of our tax dollars, so if we used this money to create jobs, instead of giving them to a handful of top executives, we could have paid an annual salary of $30,000 to 5 million people.
So while US workers are now working more hours and have become dramatically more productive and profitable, our pay is actually declining and all the dramatic increases in wealth are going straight into the pockets of the Economic Elite.
If our income had kept pace with compensation distribution rates established in the early 1970s, we would all be making at least three times as much as we are currently making. How different would your life be if you were making $120,000 a year, instead of $40,000?
So it should come as no surprise to see that we now have the highest inequality of wealth in the industrialized world and the highest inequality of wealth in our nation's history. The backbone of America, a hard working middle class that has made our country a world leader, has been devastated.
Now that we have a better understanding of how our income has been suppressed over the past forty years, let's take a look at how the economy has been designed to take the limited money we receive and put it into the hands of the Economic Elite as well.
Costs of Living
Other than in the workplace, in almost all our costs of living the system is now blatantly rigged against us. Let's take a look at it, starting out with our tax system.
In total, the average US citizen is forced to give up approximately 30 percent of our income in taxes. This tax system is now strategically designed to flow straight into the hands of the Economic Elite. A huge percentage of our tax dollars ultimately end up in their pockets. The past decade proves that -- whether it's the Republicans or the Democrats running the government -- our tax money is not going into our community, it is going into the pockets of the billionaires who have bought off both parties - it is obscene.
For an example of how this system flows to the Economic Elite, just look at the Wall Street "bailout." The real size of the bailout is estimated to be $14 trillion - and could end up costing trillions more than that. By now you are probably also sick of hearing about the bailout, but stop and think about this for a moment; Do you comprehend how much $14 trillion is?
What could be accomplished with this money is almost beyond common comprehension.
And this is just the tip of the iceberg that has hit us. On top of the trillions given to the Wall Street elite, we already have a record $12.3 trillion in national debt - and we now have to pay $500 billion in interest to the Economic Elite on this debt every year, yet another way they are milking us dry. When you add in unfunded liabilities owed, like social security payments, we actually owe a stunning $74 trillion. That adds up to a debt of $242,000 for every man, woman and child in America.
Trillions more, 25 percent of taxpayer dollars allocated to military spending goes unaccounted for every year, not to mention the billions spent on overcharging and outright fraud. During the War on Terror, the Economic Elite have used our tax money to build a private army that has more soldiers deployed than the US military - a congressional study revealed that 69 percent of the "US" fighting forces deployed throughout the world in our name are in fact private mercenaries, 80 percent of them are foreign nationals. Private contractors regularly get paid three to five times more than our soldiers, and have been repeatedly caught overcharging and committing fraud on a massive scale. A congressional investigation revealed this and strongly recommended that we seize wasting tax dollars on these private military contractors. However, under Obama, there has actually been a drastic increase in total tax dollars spent on them.
In 2009, just over $1 trillion tax dollars were spent on the military, it's safe to say that at least $350 billion of that was needlessly wasted.
When you research our tax system you see an unprecedented level of waste and fraud rampant throughout most expenditures. Our tax system is a national disaster of epic proportions. It is literally an organized criminal operation that continues to rob us in broad daylight, with zero accountability.
As it turns out, there's much more of importance to the report than I can in good conscience leave out; for that reason it will carry over one more week and finish up next week. The finishing up will leave me space to give you my analysis. I hope you're enjoying, or I should say appreciating this information. Until next week.