How to Make Prosperity a Fair and Workable Goal
for Everyone

Preface: This is the last in a series of articles on how we as a nation can break free from the economic control of our wealth that flows freely and unimpeded from the rest of us to the ultra wealthy—the 5 percent at the top, mostly unearned and untaxed. The US wealth gap is the widest of all the major economies in the world. Thus, the same nation with the most wealth in human history also has the worst record of distributing that wealth to its citizens and residents. This same inequality is the fundamental reason for nearly every condition of squalor among the poor; namely, physical health, mental health, drug abuse, education, imprisonment, obesity, social mobility, trust and community life, violence, teenage pregnancies, and child well-being.

That list is factual with many sources that have all been researched and documented after being analyzed, synthesized, and found to be accurate, reliable, and useful in terms of how to reduce and eliminate them. An excellent source is the Spirit Level, by Wilkerson and Pickett, 2009. It has more than 500 citations.

This essay is about applying critical analysis to trillions of dollars worth of wealth, whence it comes, where it goes, and why 50 percent of US residents keep falling short in their financial needs year after year. It’s part of a 20-year project of trying to teach the world about why 50 percent of humanity are poor and in desperate need of financial assistance. My challenge is for any economist or other social scientist to find one significant error of fact in it.

The objective is to give the Federal Reserve (the Fed) the means to change the US economy into a thriving network of persons earning a minimum wage of $85,000 in today’s dollars (see livingwage.mit.edu). That number applies to 52 million households, or 176 million residents. Concurrent with this gross inequality is the underlying reason for it: It’s much easier to control millions of residents when you have large stockpiles of money from which to cover the costs of putting only followers in positions of power that dictators require. That and propaganda tactics that are chock full of lies—with thugs to carry out the orders gleaned from the pages of a right-wing ideology, aka the Heritage Foundation’s Project 2025.

On a personal note: I grew up in poverty, dropped out of school when hunger, dirt, grime, and despair drove me to the streets where I could avoid close contact with kids my age. That time period still haunts me. But I did not give up on myself. Today, I am a writer/analyst with 3 academic degrees, following a multi-choice career as an economist—after a career in repairing and calibrating military bombing/navigation systems (in aircraft carrying actual nuclear bombs); then off to air-to-air missile delivery systems helping to support a war (later to be shown was based on lies); then to the science of metrology where I played a minor role in the American/Soviet space hookup; and as a whiz kid at stock market analysis where I managed $500 million in private money. So I either could not hold a job, or I was very good only at things that do not involve singing, dancing, mountain climbing, weight lifting; or football, law, sword swallowing, or kissing anyone’s posterior. I’ve worked in the private sector, for the government, and within the hallowed walls of academia. I’ve felt both the appreciation for a few accomplishments and on the receiving side of a lot of back-stabbing. I’ve also visited 30 or more different countries where strangers were one helluva lot kinder to me. You could say I embraced writing when I learned I was good at critical analysis, and I wanted to be heard. Today, I can smell a back-stabber from a mile away. They are also untrustworthy and cannot see past themselves.  Amen.

Still, figuring out how to change an entire society from the most unequal one (in terms of its money and wealth distribution) has been the most difficult challenge of my life. Twenty years from now, most of humanity could either be under the total control of mental midgets masquerading as good guys, while the remaining world population could be dying from nuclear radiation. That is not a prediction. It’s an either/or condition predicted by Murphy’s Law: too many nukes in the hands of too many loose cannons is a bad omen for humanity. Put another way, if something can go wrong, ideologues will find a way to make it happen. Also, the probability of a nuclear war compounds geometrically with the addition of just one more loose cannon with nukes in his arsenal.

Lawyers are not much help. They “talk the talk, but can’t walk the walk.” While it is true that legal training can help play a key role in righting many wrongs, it is also true that they have a knack for tearing it apart by taking the side where the wind is blowing hardest. Put another way, they seem to know which side of liberty and justice to support when it pays well, and which puddle of effluence to swim in when that’s where the gold is. Not all of them. But too many. At least three and often six members of our Supreme Court seem to follow the latter course of loyalty with consistency. A code of ethics frightens them.

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In the Main. We like to reward those who do nothing more than make us wish we had their looks, or their skills, or their charm. Football players, golfers, and game show hosts come to mind. I would buy a double-decker hamburger before I paid a nickle to send money their way. In fact, I rarely visit any venue that features game skills, athletic skills, or opinions about gadgets or issues knowing that sponsors pay celebrities huge amounts of cash for stammering their way through a cue card with words on the expectation that viewers will run out and buy a broom, a mop, or a can of beer from them. I definitely am not interested in listening to any celebrity describe a reverse home mortgage that he neither has nor wants, nor understands. Or a singer who receives multi-millions of dollars for singing at a concert I would not attend if it were free.

The Solution to wealth inequality is not wealth equality. Still, it can be slowed, stopped, and partly reversed in order to raise the average incomes of those earning about $46,000 per year to $85,000 per year. That would take $3.1 trillion spread over time. Even then, such a transition would need to be monitored by men and women with integrity, with boosts taking place slowly over at least 10 years. The Fed could easily work with the team of economists at MIT to make it happen. The word “integrity” seems to leap off the pages when I read their reports.

I don't want to get bogged down by a long list of bad outcomes put together by others. The math is well-supported, yet only a few economists can see the consequences of an economic tsunami with no barriers in place to stop it. To wit: It takes $5.1 billion dollars every day just to pay the ultra-wealthy the dividends, interest, and rents—plus the capital gains on all three sources of their wealth. It’s worthwhile to repeat: Most of their $163 trillion dollars worth of wealth was inherited, tax free, saved tax free, and grows tax free—while it causes squalor among the very poor.

The good news is that we can grow our way out of this predicament with just a few changes. Here is the Plan in simple format under the guidance and authority of the Fed:

The Plan

1. Limit tax-free inheritances to $10 million per person.
2. Adopt the MIT Living Wage scales as a national goal. Empower the Fed to monitor and adjust money in circulation to put our economy on the path to a steady GDP growth rate, that also encourages wage growth consistent with the MIT Living Wage scales.
3. Accelerate Credit Union growth and M1 money flows where all loans are to individuals and small businesses, and where 70 of all jobs are created.
4. Encourage competition among all businesses after giving new businesses tax exemptions during the first 5 years of operation.
5. Make mergers and acquisitions difficult and rare.
6. Keep businesses, workers, lawyers, academia, and Congress informed of its progress.
7. Confirm the independence of the Fed in order to assure the success of this plan.
8. Merge full employment and low inflation with this outline.
9. Forbid loyalty oaths from employees to employers.
10. Encourage loyalty by all to the Constitution.

This plan does not “take from the rich, and give to the poor.” Moreover, it should be noted that no person has an inherent right to new money that did exist yesterday. The Plan would also pay for itself via new profits; in higher taxes on higher wages; in lowering the public debt, and in higher net exports. $3.1 trillion is but 10 percent of our current GDP.

On an informal basis, therefore, making it known that new money increases would raise prosperity for all residents, not just the ultra-wealthy, would surely elicit patriotic acts, deeds, and songs by the scores. Even die-hards might be tempted to join in.