Showing posts with label income inequality. Show all posts
Showing posts with label income inequality. Show all posts

Sunday, September 20, 2020

Morning Sunshine

It's been a week, friends. It's been a lot of weeks, really. Ruth Bader Ginsburg's death hit hard, even as she carried way too much of the burden of the hopes of the left. I'm proactively pissed the fuck off about the hypocrisy and naked power-primary efforts Mitch McConnell's about to unleash to seat whatever lib-owning rich-enriching conservative Justice the Federalist Society convinces our mouth-breathing "leader" to nominate to replace RBG. Timely guestie from our friend Mr. Fairbank about one of the things that's gonna get worse before it gets better. Enjoy(?).

The coronavirus pandemic has spotlighted stresses throughout our society, none more than the gap between haves and have-nots. Millions are out of work and struggling to pay bills, while others work remotely and have financial cushions, and in some cases profit handsomely (looking at you, Jeff Bezos).

Coincidentally, or perhaps not, the RAND Corporation released a study this week on income inequality and the widening gap between the upper tier and the hoi polloi. Researchers found that between 1975 and 2018, income distribution cost the vast majority of American workers $47 trillion – that number topped $50 trillion earlier this year.

As the researchers explain, from the end of World War II until the mid-1970s, real income grew at approximately the rate of per capita economic growth across all income levels, creating an immense and prosperous middle class. Beginning in 1975, as policies, legislation and corporate practices changed, that model fizzled and income distribution pushed upward.

A few stats: if worker income had mirrored the increase in per capita economic growth since 1975, the median full-time worker would make about $42,000 more per year; adjusted for inflation, half of all full-time workers earn less than half of what they would have if income distribution were at previous levels; the top 1 percent’s share of total taxable income grew from nine percent in 1975 to 22 percent in 2018, while the bottom 90 percent of workers’ share of taxable income fell from 67 percent to 50 percent. There are a bunch of eye-opening findings, nicely summarized in several stories.

(Brief aside: This recent string of serious, “adult” posts is purely coincidental. I do not intend to disrupt the G:TB mission. As several of you know, and friends will attest, I’m often the least “adult” person in the room. These were topics about which I was passionate or had some understanding or found interesting.)

I stumbled on the RAND report through a tweet from a fellow named Dan Price. I was unfamiliar with him, which is mostly a tell on me and my range of knowledge. Price, 36, is something of a maverick and a rock star in business circles and who just happens to look a little like Dave Grohl. He is co-founder and CEO of a Seattle-based online credit card processing company, Gravity Payments, which he and his brother started while he was in college. He appears to be a business owner with a conscience, or at least a willingness to put his money where his principles are. He’s best known for goosing the minimum salary at his company to $70,000 annually and slashing his own salary from $1.1 million to the same $70k, back in 2015, after a conversation with a disgruntled employee.

The move got him pilloried by FoxNews, ridiculed by Rush Limbaugh and approached by Harvard Business School about his model and practices. He was a biz media darling and curiosity at the time. No one knew how the company’s wage transformation would play out, least of all him, but the company has grown gradually. According to one business site, the company does an estimated $38.2 million in revenue and employs approximately 200 people. They preach service to customers above bottom line, and their aim is to simplify credit card processing. The word “gibberish” is in their mission statement, as in: We don’t confuse our community business owners with credit card gibberish or hide anything in the fine print.

Before anyone canonizes Price, know that he was accused of domestic abuse by his ex-wife and was sued by his brother over fair market value and payments for the company. He was never charged with abuse, though his wife maintains her claim. He won the lawsuit by his brother.

Price’s Twitter account is worth a look, with insight into how he thinks and acts and questions about the corporate status quo. He sounds much like Seattle venture capitalist Nick Hanauer, another gent I stumbled upon while researching Price. Hanauer is a self-described “zillionaire” who also bangs away at income inequality. He routinely warns fellow rich folk that if inequality isn’t addressed that “the pitchforks will come for you.” He helped facilitate the RAND study, co-authored the piece about it on Time magazine’s website and hosts a podcast called “Pitchfork Economics.”

There’s much chatter these days about us being two Americas. Personally, I think that’s too narrow. We’re at least 20 or 25 Americas, depending on geography and means and interests and levels of engagement. Features of a free society. One factor that increasingly divides us, however, is the yawning chasm of financial inequality. Lotsa folks working their asses off and just treading water, while the swells benefit from a system that’s tilted toward them and go all Scrooge McDuck. And it’s all out in the open.

That has to change. People have to feel like they have a chance. Legislation can address it to a point, but not without stoking the divide in some ways. There are powerful and moneyed interests in maintaining the present structure. But when some people in the penthouse say that the system is flawed and needs to change for the good of society, people such as Price and Hanauer, and when there’s research that provides numbers and context, such as the RAND study, that’s immeasurably valuable in the discussion.