If you are not a member of that exclusive club, then you are a member of the other 90 percent.  The rule of exclusion also makes that a statement of fact. But that does not necessarily mean you are one those who elected the puppets who made the laws that make paying that $402,741 annually to each of those at the top a fact.  That is the inevitable outcome when so few hold the giant share of all in stocks, bonds, real estate, and commodities—the source of wealth as measured by the Federal Reserve.   

But, let’s see how well you are doing before we get to why my numbers and the reason for them are all correct, and what you can do to change them. 

If you are not one of the top 10 percent, then you are one of the remaining 90 percent, or one the 130,500,000.  In the coming year the average wealth for your group will go up $576 billion.  That comes to an average of $4,414 per year per person.  But even that number is skewed.  If you are part of the middle class (the next 57 million down from the top 10), then your wealth will likely increase by $10,105.  But if you are one of the dreaded bottom 50 percent (72.5 million souls), your net worth will go up just $79 dollars each. 

What do these numbers mean?  First, they mean we are the richest country in the world with $88 trillion dollars worth of wealth.  And it is increasing at a compound rate of 7.2 percent per year.  But 90 percent of that wealth is held by just 10 percent of those with income, while the bottom 50 percent have less than 1 percent of the wealth.  And that is the widest wealth gap of any industrialized country on Earth.  What’s more, that gap is getting wider with each passing day, and there is absolutely nothing in place (no laws, no rules, no customs, and no active or passive flows of money or wealth) that will change matters.  There are lots of good intentions, and more and more discussion about it, but no one seems to know why it is so, and therefore no one is offering a way to fix the system.   

Now, if you want all the data, and all the facts, and all the analyses that flow from them, then you also must be willing to read perhaps 2 or 3 thousand pages of numbers, data, analyses, and argumentation.  But in order to verify the numbers I have offered so far, you need only check the Labor Bureau’s workforce data, the Federal Reserve’s wealth total, and any current U.S. Lorenz Curve, and you will discover that my numbers are very close to exact, and my math is little more than 3^rd grade arithmetic.     

On the other hand, I don’t pretend to know the psychology of greed, or why anyone worth $100 million is obsessed with pursuing $500 million; or why someone with $10 billion must have $20 billion.  But every one of them clings to what they have, they all accept more, and not one speaks out in favor of the changes that are needed to stop or reverse the excessive flows to the top.  I believe that is a good definition of greed.   

Here are the underlying causes and cures:   

Basically, we need to make the economy more efficient, more competitive, and more productive, thus reducing unemployment, boosting incomes, and generating more tax revenues.   We can achieve all those objectives by getting more money into circulation; by making the tax code fairer; by impeding the emergence of huge corporate and personal dynasties; by making higher education available to everyone; by bringing everyone into a single payer health care program; by reducing the public debt; and then we can watch a long list of social ills (poverty, crime rates, mental health issues, illegal drug usage) diminish over time until they become manageable.  Specifically, the changes needed are the following (ranked by relative importance): 

1. Too much new money created by the Fed goes into savings and investments that helps only the wealthy.  Conversely, too little of new money goes into circulation where goods and services are produced and sold, where jobs and profits are created; where taxes are generated; and where general prosperity can be realized by all.  All new money created by the Fed must be directed into M1 (money in circulation).  This option must be taken away from banks to decide, and it must be mandated by law.  

2. The inheritance laws are obscene.  Trillions of dollars in wealth pass on to inheritors who did nothing to create that wealth.  The current laws are the source of all dynasties, and upwards of 90 percent of the source of all wealth.  We can alter the inheritance laws to force the ultra wealthy to give away more and more of their wealth before they die, and make the transfers taxable at the income rates regardless of the beneficiary.  In addition, we can limit the total value of inherited wealth to a fixed amount, perhaps $5 million.   

3. The corporate tax rate is too high.  It could be cut in half.  This would lower prices to consumers; make U.S. companies more competitive in trade; help to repatriate the $2.1 trillion in overseas profits; increase corporate profits; increase hiring and/or incomes; raise GDP and tax revenues; lower budget deficits, and decrease the need for government aid programs.   

4. Higher education costs too much for too many.  It should be free to students and paid by taxes.  The payback to students and to society is enormous.   

5. An unhealthy segment of our population is too costly to those without insurance and to society in general.  A single-payer government financed universal health care system for all is the only answer. 

6. Too big to fail is too big to exist and too unfair to taxpayers; competition suffers; prices are pushed up; and tax revenues fall.  Corporations with a capitalization above $20 billion need to be subject to stress tests, and those that fail put on notice that they need to be better managed by a date certain—or they can be forced to split up into smaller companies.   

7. The capital gains tax is too low.  Raising the capital gains from 20 to 30 percent would make it fairer vis-à-vis the income tax rate.  In addition, taxing large security trades at .01 percent of the value of the security would inhibit such trades while it generates tax revenues where none is now collected. 

8. The top income bracket is too low.  It can be raised to 50 percent.  What can someone worth $10 billion do that he or she could not do with $5 billion?  In practical terms—nothing.   

If we could make all these changes, both the wealth and income inequality curves would bend toward equality; profits, employment, incomes, and tax revenues would rise; budget deficits would fall; there would be ample money for building new infrastructure in roads, railways, seaports, airports, and power grids; more R&D funds for renewable energies; money for climate change abatements;  Social Security and Medicare would become solvent far into the indefinite future; the need for nearly all government assistance programs would fall; and all of our social ills would reduced to history.  

Finding precise numbers for these changes would require a macro model of the U.S. economy with all the myriad interconnections finding their new levels.  But if $8 trillion in new money were generated over 10 years, we could expect $48 trillion in new GDP, $40.8 trillion in new personal incomes, $19.2 trillion in new tax revenues at the local, state, and national levels, of which $7.2 trillion would flow to the Treasury in new federal tax revenues; while there would be $2.6 million per person for higher incomes, new health care benefits, and new retirement benefits.  There would also be ample tax revenues for education and health care costs; for budget reduction; for infrastructure rebuilding; for making Social Security and Medicare solvent far into the future; for climate control; and for R&D efforts.   

Of course, tilting the scales even slightly toward equality and prosperity for all is not in the hearts, minds, souls, or the vocabularies of the rich and powerful or their puppets in Congress or in conservative state legislatures.  How to deal with them is a subject for others to explore, and to offer creative ways to rein them in, elevate their civic-mindedness, and show them how everyone---including them—would be far better off with these common sense changes.  

Source documents:  Flow of Funds Report, Federal Reserve System (https://www.federalreserve.gov/releases/z1/current/); U.S. Bureau of Labor Statistics (http://www.bls.gov/); Reuters.com http://www.reuters.com/article/us-usa-tax-offshore-idUSKCN0S008U20151006)