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The Five-Step Process to Cheat the Middle Class Worker


Business  (tags: abuse, americans, business, consumers, corporate, corruption, dishonesty, economy, Entrepreneurs, ethics, finance, government, investments, lies, labor, marketing, politics, society )

Kit
- 582 days ago - commondreams.org
It's so artfully done, and so diabolical, that one can picture secret seminars in subterranean Wall Street meeting rooms, guiding young business recruits in the proven process of taking an extra share of wealth from the middle class.



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Kit B. (277)
Monday January 14, 2013, 3:03 pm
(image credit: unknown)


It's so artfully done, and so diabolical, that one can picture secret seminars in subterranean Wall Street meeting rooms, guiding young business recruits in the proven process of taking an extra share of wealth from the middle class.

1. Boost productivity while keeping worker wages flat.

The trend is unmistakable, and startling: productivity has continued unabated while wages have simply stopped growing. Improved technologies have reduced the need for workers while globalization has introduced the corporate world to cheap labor. In effect, the workers who built a productive America over a half-century stopped getting paid for their efforts.

Paul Krugman suggests that a "sharp increase in monopoly power" is another reason for the disparity. As John D. Rockefeller said, "Competition is a sin." That certainly is the rule of thumb in banking and agriculture and health insurance and cell phones. Yet despite the fact that low-wage jobs are increasingly defining the American labor market, apologists for our meager minimum wage claim an increase will worsen unemployment. So it remains at $7.25. A minimum wage linked to productivity would be $21.00 per hour.

2. Build up a financial industry that has no maximum wage.

This is where the money is. In 2007, before the financial crisis, a Harvard survey revealed that almost half of the school's seniors aspired to careers in finance. The industry's share of corporate profits grew from 16% in 1980 to an astonishing 45% in 2002.

And there's no limit to the earning potential. Hedge fund manager John Paulson conspired with Goldman Sachs in 2007 to bundle sure-to-fail subprime mortgages in attractive packages, with just enough time for Paulson to collect other people's money to bet against his personally designed financial instruments. He made $3.7 billion, enough to pay the salaries of 100,000 new teachers.

3. Keep accumulating wealth created by the financial industry.

Experienced schemers have undoubtedly observed that over the past 100 years the stock market has grown three times faster than the GDP. The richest quintile of Americans owns 93% of such non-home wealth.

In the last 25 years, only the richest 5% of Americans have increased their share of non-home wealth, by the impressive rate of almost 20 percent.

In just one year, the richest 20 Americans earned more from their investments than the entire U.S. education budget.

4. Tax yourself as little as possible.

The easiest and least productive way to make money - holding on to investments - is also taxed at the lowest rate. In addition to the capital gains benefit, tax ploys like carried interest, performance-related pay, stock options, and deferred compensation allow hedge fund managers and CEOs to pay less than low-income Americans, and possibly even nothing at all.

The richest 400 taxpayers doubled their income in just seven years while cutting their tax rates nearly in half. U.S. corporations can match that, doubling their profits and cutting their taxes by more than half in under ten years. The 1.3 million individuals in the richest 1% cut their federal tax burden from 34% to 23% in just 25 years.

5. Lend out your excess money to people who can no longer afford a middle-class lifestyle.

As stated by Thom Hartmann, "The 'Takers' own vast wealth, and loan it out at interest to everybody from students to governments.." Overall, Americans are burdened with over $11 trillion in consumer debt, including mortgages, student loans, and credit card liabilities.

Wealth has largely disappeared for the middle- and lower-income classes. More than $7 trillion has been lost in the decline of home prices since 2006. Young college graduates have an average of $27,200 in student loans, and the 21-35 age group has lost 68% of its median net worth since 1984, leaving each of them about $4,000. Median net worth for single black and Hispanic women is a little over $100.

So we're hanging on by the frazzled thread of debt that indentures us to the rich and makes it harder and harder to fight back against the theft of our middle-class wealth. As we struggle to support ourselves, the super-rich remain on the take, driving us ever closer to the status of most wealth-unequal country in the world.
****

By: Paul Buchheit | Common Dreams |
 

Cal Mendelsohn (978)
Monday January 14, 2013, 3:03 pm
Thanks Kit--Yes, the fat cat is getting fatter.
 

Jennifer C. (172)
Monday January 14, 2013, 4:36 pm
Thanks.
 

Dandelion G. (385)
Monday January 14, 2013, 5:08 pm
Staggaring statistics

In just one year, the richest 20 Americans earned more from their investments than the entire U.S. education budget.

The richest 400 taxpayers doubled their income in just seven years while cutting their tax rates nearly in half. U.S. corporations can match that, doubling their profits and cutting their taxes by more than half in under ten years.

More than $7 trillion has been lost in the decline of home prices since 2006. (Which is where most of the middle class wealth rested in)

Median net worth for single black and Hispanic women is a little over $100.

This is not going to stop until millions and millions of Americas rise up. The Plutocrats are not done with us yet. They will keep sucking us for every last penny for they are like alcoholics who can never get enough.



 

JL A. (275)
Monday January 14, 2013, 5:54 pm
Thanks Kit--the ghastly statistics should be a part of every high school economics class. To add fuel to the fire, in the late 1970's and early 1980's, for comparable work the financial sector paid less than any other sector/industry and the number of major players numbered a lot more (banking, insurances, etc.) and thus there still was competition until merger mania with Bush the first's tax policies (the money was supposedly going to be used to invest in equipment for continued competitiveness instead of hostile buy-outs).
 

Mitchell D. (130)
Monday January 14, 2013, 6:41 pm
Once again, you can thank Ron Reagan for the phenomenal push he gave to re-distributing wealth upwards. And to the subsequent GOP folk for doing all they can to stop that process from being corrected.
See "Democracy For the Few," by Michael Parenti.
 

Sue D. (156)
Monday January 14, 2013, 6:46 pm
Whether we all knew how they did it or not, we all suffer - except that very small % that stole it.
 

Kit B. (277)
Monday January 14, 2013, 6:54 pm

Until we DO some thing, this will continue.
 

Brian M. (145)
Monday January 14, 2013, 6:55 pm
The American people need to stand up to this exploitation and demand an end to it.
 

Roseann D. (178)
Monday January 14, 2013, 7:15 pm
Diabolical indeed. Perhaps the GOP supporters might someday realize it's the Anti-Christ-ian movement their pastors warned them about.
 

Kit B. (277)
Monday January 14, 2013, 7:19 pm

So sorry I don't have any Green Stars, thank you for the comments.
 

Angelika R. (146)
Monday January 14, 2013, 8:54 pm
Roseann already said what was on my mind, so I'll just give credit to that unknown cartoonist! Thx Kit.
 

Michael Carney (209)
Monday January 14, 2013, 9:12 pm
Great post, Kit...
 

Kit B. (277)
Monday January 14, 2013, 9:16 pm

I found that some time back and have been waiting to use that great cartoon. A FAT CAT with a map of the world how very appropriate!
 

Robert O. (12)
Tuesday January 15, 2013, 12:25 am
The greedy, elitists of the GOP have made this process into a science. Thanks Kit.
 

Craig Pittman (45)
Tuesday January 15, 2013, 12:22 pm
Sounds like a very good deal - for the 1%. And it probably seemed like a good idea (albiet modified) by the French aristocracy right up until 1789.
 

Kit B. (277)
Tuesday January 15, 2013, 12:33 pm

Yep, we all know about the French Revolution, what most do not know or remember from high school history is what happened in the wake of the work out of the guillotine. Without a very good plan, and strong, essentially non corrupt leaders, we could make things much worse. We need a plan, one that incorporates those things that work well and to be unafraid to try or experiment with the unknown. We may need to remember that waiting till we are on the very edge is not productive, it's often just reactionary.
 

Gene Jacobson (251)
Tuesday January 15, 2013, 1:10 pm
"Experienced schemers have undoubtedly observed that over the past 100 years the stock market has grown three times faster than the GDP. The richest quintile of Americans owns 93% of such non-home wealth."

If there were such a thing as sin, this would be it. Amazing how little that richest quintile knows of history though. Every nation that has gotten to this stage has fallen, usually collapsing from within. Maybe if the NRA knew that they wouldn't be so anxious to have a gun in every home. We are teetering on the brink of our societies collapse and these "brilliant" wealthy fools don't even see it coming. But they will, too late, I'm sure to rectify this incredible disparity and save our way of life - not THEIR way of life, but the real American dream where all have enough and all are cared for, that may be utopian, but it is how the American Dream has always been envisioned, it is what has brought immigrants to our land since we became a country. What we have now more closely resembles the "capital" of the Hunger Games for a few than it does a land of opportunity for all. If we do not change, this "capital" will meet the same fate as that in the Hunger Games - see book 3 for details. Coming soon to a neighborhood near you.

 

Nancy M. (201)
Tuesday January 15, 2013, 2:00 pm
Thanks Kit. Nice to see some of us noticing.
 

Lois Jordan (54)
Tuesday January 15, 2013, 2:05 pm
Noted. *I'm sorry I'm unable to send a green star to Gene since I sent one in the past week.
Reading Gene's comment, "...if the NRA knew that they wouldn't be so anxious to have a gun in every home." I'm wondering if maybe this is exactly what they want....people shooting each other in the streets. The wealthy have protected themselves behind massive barriers. Maybe this is their plan to thin the population....
 

Mary Donnelly (47)
Tuesday January 15, 2013, 2:46 pm
Thanks Kit. I hope more people notice, and do something about it.
 

marie tc (166)
Tuesday January 15, 2013, 5:15 pm
Thanks Kit
 

firedup N. (0)
Tuesday January 15, 2013, 5:23 pm
Five ways to cheat the middle class and I will also add in the poor. 1. Obama 2 obama 3 obama 4 obama 5. obama. Thanks to Obama the black unemployment rate has gone up over 14%
 

Kit B. (277)
Tuesday January 15, 2013, 5:41 pm

I'm sure it has nothing to do with the economy, or the policies of the past 30 years. Yes, of course the problems of this country revolve around just one man. Try some reading - you might just enrich your vocabulary.
 

Sue D. (156)
Tuesday January 15, 2013, 6:01 pm
Thank you, KIT.

firedup, or whoever you are. Get off your high horse! You are not in a Faux chat room where most don't know what they are talking about except to believe the propaganda spoon fed to them by the GOP/TPers. Try gaining some reasonable talking points instead of proving to the rest of us that you know how to spell one word - obama, and that only uses 4 letters of the alphabet. How do you expect to have any kind of response when the ONLY thing you can say is "obama" ? Bet you didn't even read the article!
 

Theodore Shayne (56)
Tuesday January 15, 2013, 6:09 pm
Definitely posted. More Chinese knockoffs above. Please avoid these sites.
 

Kit B. (277)
Tuesday January 15, 2013, 7:56 pm

I do wish I could send you another Green Star, Sue. Well said.

Theodore, I have to assume you are talking about SPAM that is no longer on this site. When I see it, I go the profile page and flag the page. This I hope alerts Care2 that another SPAMMER is posting.
 

Past Member (0)
Tuesday January 15, 2013, 9:42 pm
For a moment there I thought I was reading about one of Australia's past Prime ministers. [no names mentioned]. Enjoyed the read. Thanks.
 

Suheyla C. (229)
Wednesday January 16, 2013, 1:17 am
Thank you Kit
noted
 

Nancy M. (201)
Wednesday January 16, 2013, 5:50 am
Gosh, the article did forget one way....convince one politcal party that those at the bottom are there because they are lazy and do not warrant any help- because they have not "earned" it.
 

Mary L. (138)
Thursday January 17, 2013, 5:55 pm
Don't forget whinging about how poor you are and how you're going to stop hiring because your personal tax is going to go up.
 
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