While millions of Americans are struggling with a growing consumer debt crisis and surviving paycheck to paycheck, the wealthy are living their best lives — and increasingly so. This stark economic divide is no accident; it is the product of a rentier economy built on asset inflation and decades of failed trickle-down policies. It’s also a house of cards. But for those at the top, the living is easy. For now, at least.
As the Wall Street Journal reports, the top 10 percent of earners has grown to account for nearly half of US consumer spending — up about fourteen points over the last thirty years. These households enjoy incomes of $250,000 or more each year — money that comes from assets as much as wages or salaries, and which goes to luxury goods and services. Mark Zandi, chief economist at Moody’s Analytics, told the Journal that the wealthiest are spending more per capita than everyone else, buoyed by gains in the stock market and real estate.
The shift represents a growing wealth gap, a growing concentration of power in fewer hands, and an economy that is increasingly detached from reality — but dangerous for all that. Beyond the growing wealth gap, the wealthy are making the economy more reliant on their spending, a situation that carries serious risks.
Rachel Louise Ensign writes in the Journal that “a stock market selloff or decline in home values that rattles the confidence of the top 10 percent and causes them to cut back would have a significant effect on the economy,” noting as well that consumer confidence is already looking…
Auteur: David Moscrop
