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Wednesday, February 22, 2012

Two Plus Two Does Equal Four

I have heard it said – from spokespeople for the oligarchs, what we often call Dempublicans – that the wealth of the few is just not enough to make any substantive difference if it were distributed among the vast many.  If, in the US, the income of the top 1% were to be taken and spread out evenly to the 99% there would be a one-time bump-up in income of $9,000 dollars per capita… and then the lights would go out because the engines of progress would have been turned off.

I don’t think that $9,000 was admitted to, but that is the figure that I get when I take the total personal income figure, $12.5 trillion, times 23% (the amount of total personal income taken by the 1%) divided by 310 million less 3.1 million [1].  But even that amount, as a one-time infusion, doesn’t seem so terribly significant.  It will not buy a house or even a new car.  If it were used wisely, much of personal debt could be paid off.  And then famine and ruin since all the “job creators” would be in breadlines.  But wait! This argument is so foolish as to fall into the category and reality of bullshit.

We must look at the income distribution and see what happens when various numbers are tweaked, not what would happen if the income of one year were to be taken in total from the one percent and distributed to everyone else.  For example:

personal income range -- $US
100,000 +
75,000 – 100,000
50,000 – 75,000
25,000 – 50,000
25,000 or less

This distribution of income from 2008 gives the average income for each of the percentages of the population; the top 7% includes a lot of people who take about $100,000 and a tiny few who take some billions – and so forth.  This distribution of income equals a total of about $12.8 trillion and represents a per capita income of $41,000.

Suppose we change a few numbers:

Average personal income -- $US
(note: I have used averages for each percentage rather than a range.  Just imagine that the $80K has a range with lots of $75K incomes and a few multimillion $ incomes)

This hypothetical distribution of income equals a total of $12.5 trillion and a per capita income of $40,000.  The rich have not been savaged and sent to the soup kitchens and the lowest income level has increased about100%.  It is important to note quickly, since I can imagine certain readers turning red faced and experiencing dangerous medical symptoms, that these are per capita INCOMES – incomes: money made from working; and in the case of especially the bottom 30% this means actually working at jobs essential for the continuation of civilized life.

There are other optional futures that make more sense if humans are to survive, and allow the rest of life on the earth to have a chance, but the changes are so dramatic that they are very unlikely to be taken on willingly.  How about this distribution with half the total income – and therefore about half the ecological footprint (but still more than the earth can support)?

Average personal income -- $US
(note: again, the top 1% on this table would be represented by a lot of people with incomes of $47K and a few with multi-hundred thousand dollar incomes)

This distribution of income totals to $6 trillion with a per capita average income of almost $20,000.  But you will note that it is the top percentages that have the most dramatic changes, and even these still could show some amount of conspicuous consumption.  Compare this table with the first table, real distribution for 2008, and notice that there would be small relative change in the lower percentage incomes.

There are many other issues involved in these potential income distributions, like taxation, types of work to be done, private versus public work, wages and minimum wages, consumption levels versus levels of meeting personal needs by private action, land distribution, meaning of success and a host of others.  But they are just that, issues requiring consideration and action.  What I am pointing out is that there are realistic ways to consider our economic situation other than demagogy.

What we have today are a few people desirous of and positioned to obtain huge amounts of the earth’s productive capacity.  They are using their advantaged position to take more and more.  The psychological consequence of their separation from the rest of humanity and the biophysical realities of the earth’s functioning is the special madness of privilege.  It is nothing new, but has, in the present ambience of incredible power, reached a level of danger unprecedented and perhaps beyond hope.

But at least we can see our way out in an honest accounting of the numbers even if the actual applications of power and force reject such solutions.

[1] Yes, that is right, by these calculations the 1% collect $9,000 in income for (from?) every man, woman and child in the USA.  It is certain that quite a number of the 1% are using the tax code to collect it for them and to redistribute it to them as various tax loopholes, bailouts, sweetheart Government contracts, rebates and other devices.

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