This is not an attack on the wealthy, so please refrain from the arguments of welath envy and fairness, etc.. I want this debate to focus on what works and what doesnt. So we have been in the midst of trying supply side for decades now, and there is nothing stopping people from investing. The sole thing preventing investing is having enough customers and customers need income to purchase things. We have been going at supply side the wrong way. America’s wealthy are richer than they’ve ever been. Big corporations are sitting on more cash they know what to do with. Corporate profits are at record levels. CEO pay continues to soar. But the wealthy aren’t investing in new companies. Between 1980 and 2014, the rate of new business formation in the United States dropped by half, according to a Brookings study released in May. Corporations aren’t expanding production or investing in research and development. Instead, they’re using their money to buy back their shares of stock. There’s no reason for them to expand or invest if customers aren’t buying. Consumer spending has grown more slowly in this recovery than in any previous one because consumers don’t have enough money to buy. All the economic gains have been going to the top. The Commerce Department reported last Friday that the economy grew at a 4.6 percent annual rate in the second quarter of the year. So what? The median household’s income continues to drop. Median household income is now 8 percent below what it was in 2007, adjusted for inflation. It’s 11 percent below its level in 2000. salon/2014/09/30/robert_reich_trickle_up_economics_are_killing_americas_middle_class_partner/?utm_source=facebook&utm_medium=socialflow
Posted on: Tue, 30 Sep 2014 17:44:25 +0000
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