America’s ultrarich just get wealthier
November 12, 2019 - America’s wealthiest one-percenters have benefited from a surging stock market, low interest rates and Republican tax cuts, amassing assets just shy of the those held by each of the middle and upper-middle classes.
Democratic candidate for president, Elizabeth Warren, has made a federal tax on wealth -- on a household’s total net worth -- a pillar of her campaign. Her plan for a two per cent tax on assets above $50 million, plus a one per cent “surtax” on those over $1 billion could see Microsoft founder Bill Gates paying $6.4 billion.
The richest one-percenters had a household wealth of about $35.4 trillion in the second quarter of 2019, up a staggering $2.9 trillion over the past six months. In contrast, the bottom 50 per cent of the population saw a collective increase in assets of $500 billion over the same period.
Americans in 90th to 99th percentiles control the most significant share of wealth, with $42.6 trillion in assets.
The one-percenters also benefited from President Trump’s 2017 “Tax Cuts and Jobs Act,” under which the rich, banks and other corporations enjoyed permanent tax cuts to corporate profits, investment income, estate tax, and more.
A recent analysis by The Economist found that some members of the nine-zero club take advantage of what economists call “rent-seeking” -- using cartels and lobbying for rules that generate more profits for their business at the expense of competitors and customers. The Economist identified rent-seeking as typical in mining, defence and construction industries as well as casinos. The study concluded that in the U.S., rent-seeking industries made one in five billionaires and explained a third of total billionaire wealth.
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