Economists suggest the United States has become a plutonomy

It has been posited many times that the United States functions as a “plutonomy.” The word is a portmanteau of the words plutocracy and economy, meaning the economy hinges on the richest of the rich. It has been argued that it really been that way all along. Recent figures indicate that the richest few are what have driven any relative improvements in the economy. Source of article – Economists suggest the United States has become a plutonomy by Personal Money Store.

Plutonomy has nothing to do with cartoon dogs

What the term plutonomy implies is the economy is driven by and depends on a small number of the wealthiest individuals. There is reason to think any “improvements” during the recession have anything to do with the spending habits of the richest few. The Wall Street Journal reported on the findings of Moody’s of consumer spending patterns. Over the past 20 years, the richest 5 percent alone contributed 37 percent of consumer spending. The bottom 80 percent (i.e. the rest of us) contributed less than 40 percent. Almost 50 percent of all income earned goes to only 10 percent of the population in the U.S.

The math works

According to a study released in 2006 by the Federal Reserve, economist Arthur Kennickell found that the wealthiest 10 percent of the nation held almost 70 percent of the wealth. That means for each and every dollar of value within the sum total of all non-public assets of the United States, 90 percent of the population owns only 30 cents worth. The trickle Reagan talked about was no trickle going down; it was a tsunami going upwards.

In order to set up a more perfect union for the rich

Historians for instance Howard Zinn and others have posited that the Founding Fathers were all the wealthiest of the wealthy. Their profits were affected more by British taxes than the commoners were. Thus, they revolted and established a nation in which they would enjoy an oligarchy of advantage. Only a 3rd of Americans were in favor of the Revolution, with the other two thirds being hostile or indifferent, and that was as outlined by none other than James Madison. Republics inherently favor the growth of aristocracy and oligarchies. If there is one universal harbinger of doom for a society, it is a growing and vast disparity between the wealthiest few and also the many poor.

Additional reading

online.wsj.com/article/SB20001424052748703988304575413432696177258.html

en.wikipedia.org/wiki/Wealth_inequality_in_the_United_States

federalreserve.gov/pubs/feds/2006/200613/200613pap.pdf – PDF, demands Adobe Reader