There are a lot of not-so-fun facts in the latest Institute for Policy Studies “Billionaire Bonanza” report on the absurd, widening gap between the people in the Forbes 400 and the rest of us.
For example, the top 20 wealthiest individuals in the U.S., according to Forbes, have as much wealth as half of the entire U.S. population. That’s right: the number of people who can fit in a Gulfstream luxury jet control as much wealth as 152 million people.
Or this: The wealth of the top 100 individuals on the Forbes list equals the wealth of the nation’s entire African American population of 42 million people. This group has wealth that exceeds the gross domestic product of Indonesia, the world’s 16th largest economy. (And that group of 100 would be all white: The only two African Americans in the Forbes 400 are media mogul Oprah Winfrey, ranked 211 with $3 billion, and Robert Smith, who runs the Vista private equity firm and ranks 268 with $2.5 billion.) Similarly, the wealthiest 186 members of the Forbes 400 own as much wealth as the entire Latino population, over 55 million people.
“The level of U.S. wealth inequality has grown so lopsided that our classic wealth distributional pyramid now more resembles the shape of Seattle’s iconic Space Needle,” the report said.
The needle at the top is the nation’s wealthiest one-tenth of 1 percent, the 115,000 households who own 20 percent of the nation’s household wealth – a percentage that used to be just 7 percent back in the 1970s.
At the tip of the needle is the Forbes 400, a group with more wealth than 61 percent of the U.S. population – or, as the report cheekily points out, as much wealth as all of the American households that own cats.
This matters, the report says, because “according to research across several academic disciplines, extreme inequalities of income, wealth and opportunity undermine democracy, social cohesion, economic stability, social mobility, and many other important aspects of our personal and public lives.”
The report calls for “policies that directly address the top-heavy distribution of wealth,” including the ability of the wealthy to evade taxes. Another not-so-fun fact: You know the estate tax that conservatives have branded a “death tax” and painted as so devastating to “job creators” that Republicans have made it a priority to abolish it? Billionaires have already more or less abolished it for themselves, using something called a Grantor Retained Annuity Trust. (It’s the brainchild of a lawyer named Richard B. Covey.) Using this tax scheme, casino owner and right-wing political financier Sheldon Adelson has been able to transfer $8 billion to his heirs without paying $2.8 billion in estate taxes he would otherwise owe, the report said.
The report underscores what we must demand from anything worthy of the name “tax reform”: End the use of offshore tax shelters. End the schemes designed exclusively to dodge the estate tax. Impose a “wealth tax” on millionaires and billionaires with extensive assets. Tax capital gains – the earnings from stocks and other investments that accounts for the majority of earnings for people at the top – at the same rate as the wages the rest of us depend on.
That way, as the report stresses, we would have the resources to make the investments we need in education, health care, family support services, income security and infrastructure that would help the 99 percent of us increase our own wealth.