Robert Reich connects the dots on the economy, in less than 2 minutes and 15 seconds.
Summary:
- Since 1980 the American economy has doubled in size. However, adjusting for inflation, wages have barely increased.
- Almost of all of the gains of the economy have gone to the super rich.
- With money comes political power. Before 1980 the top tax rate was up to 70%. Now it is 35%. Much of their wealth comes from capital gains, which only has a 15% tax rate. The richest 400 Americans pay only 17% tax.
- Tax revenues are down, which produces huge budget deficits, which means public services are being cut at all levels of government.
- The middle class is divided and competing against each other for the scraps left in the economy.
- The middle class is no longer able to borrow as much as it could before, meaning it doesn’t have the purchasing power to kick start the economy, which means there is continued high unemployment.
Conclusion: The only way America can have a strong economy is with a strong middle class.