HISTORICALLY, MOST ECONOMIC systems revolve around who owns the wealth. As an economist and historian, this is the question I bring to any discussion about our current economic crisis and any future “new economy” we might imagine.
While income distribution is important, wealth distribution is much more unevenly allocated in American society, and it gets very little attention. Let’s quickly look at the numbers.
The richest 400 people in the U.S. own more wealth than the bottom 60 percent of the population. That’s more wealth (stocks, bonds, and businesses, but also houses and cars) than the bottom 150 million Americans. And the top 1 percent owns almost 50 percent of the society’s productive investment assets (corporate stocks, bonds, and privately held businesses, excluding cars and houses).
When you ask who owns the productive assets of the society, then you’re asking who owns American capitalism. The answer is: The top 1 percent owns just under half of it.
With this kind of wealth distribution, what we have is literally a medieval structure. I don’t mean that figuratively. It is a feudalistic structure of extreme power and wealth. And it is anathema to democracy to have that kind of concentration. This distribution of wealth—and the the fact that the top 1 percent has, over the last 30 years, increased its share of income from about 9 percent to about 20 percent—tells you something about the political/economic power harnessed to achieve that end.
The “new economy movement” that is building momentum around the country asserts that you can’t have a democratic society unless you democratize the ownership of wealth as well.
Here are six examples of where that’s happening right now:
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On Monday the Dow Jones industrial average fell 634.76 points; the sixth-worst point decline for the Dow in the last 112 years and the worst drop since December 2008. Every stock in the Standard and Poor's 500 index declined.
It is easy to blame bipartisan bickering for the impasse that led to Standard and Poor's downgrading of the American debt, and in turn the vertiginous fall of the Dow. This bickering -- this substitution of ideology for reason, of egotism for compassion and responsibility on the part of lawmakers -- is a national disgrace; but while it failed to fix the problem, we must realize that it did not cause it. The cause -- and potential for a significant renewal -- lies much deeper.
So let's allow ourselves to ask a fundamental question: what's an economy for?
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The website Boycott Murdoch also has Facebook and Twitter pages. While the boycott has received coverage on many mainstream news outlets, it has yet to gain much traction. The Facebook page has less than 700 fans and the Twitter page is approaching only 1,000 followers. To make even a small dent in Murdoch's bottom line, the boycott will need to metastasize, and quickly.
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