Dominic Rushe writes in The Guardian that the wealthy are worried. Ray Dalio is the latest billionaire to air his unease:
Dalio, founder of Bridgewater, the world’s biggest hedge fund, an investor in low-wage employers including Walmart and KFC, and a man worth about $18bn according to Forbes, became the latest in a bank of billionaires to go public about his fears of widening income inequality.
The yawning gap between rich and poor is a “national emergency”, Dalio wrote in an 8,000-plus-word blogpost on LinkedIn (where else?) that poses an “existential risk for the US”.
The list of worried billionaires is growing:
Dalio joins the JP Morgan boss, Jamie Dimon, investment guru Warren Buffett and even the Blackstone chairman, Stephen Schwarzman, “private equity’s designated villain” ( copyright the New Yorker) and usually an unapologetic 0.01%er, in publicly worrying that income inequality has stretched the US body politic to breaking point.
So dire has the situation become that Schwarzman called for a Marshall plan – referencing the US initiative that aided the rebuilding of western Europe after the second world war – to help rebuild the middle class. Admittedly he couldn’t quite use the word “inequality” (that might suggest something was unfair), preferring to argue the real problem was that those not in his wealth bracket were suffering from “income insufficiency”.
That's the new buzz phrase -- "income insufficiency:"
Never before have so many of the kings of capitalism showed so much concern about the system that created them, said Charles Geisst, author of Wall Street: A History and professor of economics and finance at Manhattan College.
The last time the 1% felt so under pressure was probably back in the 1930s as the US came to terms with the Great Depression, said Geisst. But back then the super rich did not criticize capitalism. “If you called someone a communist or a socialist at that time, that was fighting words because of the atmosphere with the Soviets,” he said.
Now the political debate has shifted, said Geisst. “I think they realize that Bernie Sanders has a lot more support than a lot of people think,” he said. Sanders and fellow Democratic presidential hopeful Elizabeth Warren “could give them a really bad time” with their plans for higher taxes and greater regulation, he said. “These people are famous for hedging their bets, and this is another way of doing it.”
Steve Glickman, a senior economic adviser in the Obama administration and now founder of Develop, a company seeking to attract investment to low-income areas called “opportunity zones”, said the very wealthy understand there has been a societal change that challenges the way they have done business.
“An increasing chunk of the country has been left behind and that can’t be ignored any more,” he said. “The rise of populism, not just in the US but also in many other markets like Europe, is dramatically affecting the business model they have taken for granted. We are turning the table on what was close to 90 years of agreed upon bipartisan policy goals around trade and immigration.”
If the billionaires are really concerned for the future, they could start to change that future by getting rid of Donald Trump.
Image: The Fiscal Times
6 comments:
So now we know what’s ailing the slugs. They’re suffering from a case of “income insufficiency”. I don’t know that he has a name for his billions or whether he realizes, but is unwilling to admit, that he wouldn’t have as many of them if others like him hadn’t been raising those now suffering slugs on a steady diet of market-libertarian pablum since their granddaddies were on the tools. A guy with those billions couldn’t be that stupid, could he? Anyway, now those billions qualify him to deliver, with some important modifications, a few extracts from the lecture that the leftards started giving us forty years ago Make room on the podium. We don’t like listening, but when we do we always prefer listening to billionaires.
If the billionaires were really concerned they wouldn’t still be putting their money on right-to-work-for-less and libertarian propaganda.
If they really are as smart as they claim to be, John, they'd know that sharing the wealth keeps the machine going.
I'll believe the billionaires are concerned when they start donating to politicians who promise to raise their taxes and strengthen labour and union rights. Until then, it's just fat cats worrying that the supply of mice is getting scrawny and they're having to eat more to feel full.
Cap
Your point is well taken, Cap. The anxiety the wealthy feel is rooted in self interest. "Income Insufficency" means that their own positions atop the pyramid are threatened.
Some of those billionaires may have studied history and saw what happened in the last golden age of billionaires or at the time multi millionaires. it gave way to the rise of Unions and workers' organization. people became more politically involved. Some of those 20, 30 some things might remember their grandparents, the aging baby boomers and their parents had it a tad better. yes, the billionaires are right to get nervous.
A defunded population can't purchase the products many of them are selling. There is also the no small problem of people living on the verge of bankruptcy. Once that starts a lot of them could loose a lot of money. they saw how fast things went south in 2008. Fortunately the Americans had a new president, who managed to get the country through. Now they have an idiot running the show, who has been very good to them with his tax plan, but its negatively effecting people like Gold Star families. Its the sort of thing which could inspire changes and those billionaires would like to manage those changes, not the public.
I have no doubt that the billionaires are looking after their own self interest, e.a.f. Some of them may perceive that their own self interest may be involved with the common good.
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