Productivity in the United States has steadily risen over the past 30 years, and the U.S. continues to be one of the wealthiest nations on earth. Despite this reality, the vast majority of Americans are not being rewarded for their efforts, and many people are earning less than their parents! The reason productivity is up is because Americans are working longer and harder than they have in recent memory. Productivity is thriving, yet worker salaries are dying.
As it turns out, conservative politicians in Washington have vigilantly pursued a set of economic and tax policies over the past 30 years reflecting the theory of trickle-down economics. Simply put, this theory rests upon the assumption that perpetually lowering taxes on millionaires and billionaires, as well as borrowing money from future generations to give to the wealthiest members of our society will somehow trickle-down to the rest of us. It’s safe to say that this theory has proven to be a complete and utter failure, and has led to the largest gap in wealth between those at the top (1%) and everyone else (99%) since the great depression.
The consequence of pursuing these policies has resulted in what can clearly be described as ‘wealth extraction’ from our economy. The privileged class in the top 1% feels entitled to the wealth we all work hard to create, and they have used their power and influence to ensure legislation is passed that permit this to occur. Evidence for this can be seen in 2010, when this group of wealthy elite claimed nearly all income gain in this country for themselves. In 2010, the top 1% took in 93% of all income gain in this country. Essentially, what this means is that America is stuck working harder than ever to create wealth for our nation that the top 1% extracts for their upper class members, while the rest of us struggle to survive on what little remains.
It wasn’t always this way, and more importantly it doesn’t have to be this way moving forward. During the golden age of capitalism (1945-1975) all Americans in each income group were valued for the contributions they made, and were fairly compensated for their efforts. Those at the bottom of the economic scale saw their incomes rise just as quickly as those at the top. For the first time in our nations history, millions of families could afford to buy a home, send their kids to college, purchase a new car, and lead relatively comfortable lives. In short, the middle class was thriving. During this time period, we all worked together to create wealth for our nation that was adequately shared among us, and fair and progressive tax policies were put in place that prevented the privileged class from extracting wealth from the rest of us.
This all changed when President Ronald Reagan took office. Instead of embracing what was working for everyone, conservative politicians decided to replace the progressive tax code with tax policies favoring their wealthy elite donors. As a result, rather than sharing in the wealth America worked together to create, those at the top decided to keep more of the money American workers generated for themselves. In essence, the implementation of trickle-down economic policies allowed the privileged few to turn America into a we make it, they take it economy. The wealth extraction underlying the divide between those at the very top and everyone else characterizing the conservative philosophy of we make and they take it has proven to work wonders for those at the top, but not so much for everyone else.
Since the wealth America creates is no longer being shared among us, and workers are no longer valued for their means of production, or paid thriving wages, poverty rates are steadily increasing, the middle class is eroding, more people are dependent upon food stamps and other government assistance to survive, and the most vulnerable populations among us are facing grave consequences each day we continue to adopt these failed and misguided policies. The behavior of conservative politicians insisting our nation prioritize borrowing money from future generations to give to the super wealthy is not only immoral, but leads to catastrophic consequences for the vast majority of people in order to pave the way for what Vice Presidential hopeful, Paul Ryan calls a path to prosperity for the top 1%.