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Citizens’ assemblies: are they the future of democracy? A look at the surge in popularity of randomly selected councils that offer an alternative to politics as we know itWhen Fauzia Bajwa, a retired software developer who lives in St-Bruno-de-Montarville, Quebec, received an invitation to participate in something called a citizens’ assembly, her first impulse was to write the letter off as junk mail. It’s a common reaction: most recipients of such a mailing never bother to respond. Then Bajwa looked at it again. The sender was listed as the Canadian Commission on Democratic Expression, a non-profit organization that compiles opinion reports to submit to the Canadian government. Though the mailing’s language was vague – the assembly would be on the subject of so-called “online harms” – Bajwa’s curiosity was piqued. After all, she’d just read a book about online surveillance, and at the time was waking up to a news cycle that seemed to revolve around the tweets of a certain president of the United States. “I found it quite concerning that people were using what I initially considered to be a very good and useful tool” – the internet – “to put out lies and fake information, so I was already thinking about these issues,” she says. She went online and signed up.Citizens’ assemblies, a phenomenon that is gaining in popularity around the globe, date back to ancient Athens, where legislative panels, courts and councils were chosen via random selection. In a practice known as sortition, Greek citizens over the age of 30 were enlisted to debate governmental matters from city finances to military strategy. More recently, citizens’ assemblies have convened to hammer out solutions to such issues as homelessness in Los Angeles, the allocation of a $5bn budget in Melbourne, Australia, and the longstanding ban on abortion in Ireland.Is the tiny little neighborhood the city of the future?Read moreIn 2017, after meeting over the course of five weekends for deliberation, an Irish citizens’ assembly came up with a recommendation to legalize the procedure. Sixty-six per cent of Irish voters later approved the referendum, ending more than four decades of fruitless political debate.Modern citizens’ assemblies are typically convened by legislative bodies, which work alongside non-profit groups to reach out to large numbers of citizens at random – sending letters like the one Bajwa received in the mail – then sorting the respondents who express interest according to social and economic factors. The result is a group of people who are randomly selected and reflect the demographics of the population as a whole.Sortition, a word that might evoke the next chapter in the Hunger Games franchise, offers a revived spin on democracy. Instead of leaving the decision-making up to elected officials, citizens’ assemblies can offer a special interests-free alternative to politics as we know it.The system is not unlike jury duty. With facilitators in place to provide background information on the issue at hand and encourage everyone’s participation, the group meets over the course of several days to learn about a problem, hear from a range of stakeholders and experts, and come up with recommendations for new legislation.Claudia Chwalisz, founder of the Paris-based international research institute DemocracyNext, has dedicated her career to promoting this resurrected model of democracy. “As the ancient Greeks and others recognized, elections are a way of constituting an oligarchy,” she says. “When the French and American revolutions led to the establishment of the institutions that today we call democratic, the word ‘democracy’ was never used – the intent was for them to be oligarchic, concentrating power in the hands of the few.”Today, when a run for Congress can come with a price tag starting at $400,000 (Senator Raphael Warnock of Georgia raised a whopping $26.4m for his run in the third quarter of 2022), the notion that government is run by the elite is pretty much a given. More than half of the members of the US Congress are millionaires. The same cannot be said of the participants in an average citizens’ assembly.And yet, more than 500 citizens’ assemblies have informed policymaking in recent years, with permanent citizens’ councils now in place in Paris, London and Ostbelgien, Belgium. These groups have deliberated on everything from affordable housing in Switzerland and taxes on corporate income in Oregon to population decline in Japan. Wherever it’s practiced, sortition facilitates meaningful conversations among everyday people, and has the potential to help fractured societies not only work on complicated problems, but learn how to live with one another. According to Peter MacLeod, founder of MASS LBP, a Toronto-based firm that works on a number of citizens’ assembly projects, “Getting opinions is not difficult. Finding common ground, however – that’s the art of the process.”But does the process actually work? A citizens’ assembly on climate in France resulted in an ambitious climate bill that promised to reduce the country’s carbon emissions by 40% – but fewer than half of the assembly’s proposals made it to parliament for debate. Without a commitment from lawmakers to include an assembly’s recommendations in bills and voter referendums, the practice can be little more than an intensive debate club.But the potential for far-reaching change is vast. In the case of overturning the abortion ban in Ireland, the assembly that recommended an amendment to the Irish constitution functioned like a “miner’s canary”, according to Peter Stone, associate professor in political science at Trinity College, Dublin. “Everyone knew that things had changed since abortion was banned in the 1980s with overwhelming support, but no one was sure how much things had changed. And for a politician, it can be very dangerous when things change.” Citizens’ assemblies, Stone argues, function as a kind of hothouse for public opinion. The act of getting a bunch of randomly selected citizens together to work out their views on a contentious subject functions as invaluable market research on the future. It not only reveals what the public believes right now, but shows also how those beliefs are changing as people talk about an issue. In Ireland, the assembly gave the Oireachtas, the Irish parliament, the political green light it needed to make a change.When Bajwa first spoke up at the Canadian assembly on digital technology, she came out against online anonymity. “You can’t just spew out hate speech or slander online from behind the veil of anonymity,” she argued. Then other members of the assembly, immigrants from places like the Philippines and the Middle East, shared their own takes. “People talked about places in the world where having your identity revealed can be a danger to your life,” she said. “It didn’t change my point of view totally, but I did modify my opinion on that.” She also learned that there were parts of Canada that had no internet access whatsoever, which surprised her and reshaped her understanding of the issue. “Being in a room with people who you would probably not meet on a day-to-day basis – that in itself was fantastic.”Critics of citizens’ assemblies – including none other than Socrates – point to the lack of expertise among the general public about a given issue. Without adequate educational materials and expert testimony, an assembly can end up relying less on fact than on opinion – or be influenced by bias in the resources they have available. The UN Democracy Fund has a guidebook that details best practices for choosing background materials and speakers at assemblies, and offers more information for participants who request it.At the digital technology assembly commissioned by the Canadian Commission on Democratic Expression, Bajwa and her fellow participants heard from 13 experts, including university professors, specialists in internet and criminal law, and even one representative from Twitter. The minister of Canadian heritage, Pablo Rodriguez, found the assembly’s process so compelling that he has requested an additional assembly to consider its findings. Legislation incorporating many of its recommendations is expected to be proposed in March.TopicsUS politicsRadical thinkingInequalityfeaturesReuse this content More
The US ultra-rich justify their low tax rates with three myths – all of them rubbishRobert ReichA record share of the nation’s wealth is in the hands of billionaires, who pay a lower tax rate than the average American. This is indefensible On Tuesday, the Congressional Budget Office released a study of trends in the distribution of family wealth between 1989 and 2019.Over those 30 years, the richest 1% of families increased their share of total national wealth from 27% to 34%. Families in the bottom half of the economy now hold a mere 2%.Meanwhile, a record share of the nation’s wealth remains in the hands of the nation’s billionaires, who are also paying a lower tax rate than the average American.How do the ultra-wealthy justify their wealth and their low tax rates? By using three myths – all of which are utter rubbish.The first is trickle-down economics.Billionaires (and their apologists) claim that their wealth trickles down to everyone else as they invest it and create jobs.Really? For more than 40 years, as wealth at the top has soared, almost nothing has trickled down. Adjusted for inflation, the median wage today is barely higher than it was four decades ago.Trump provided a giant tax cut to the wealthiest Americans, promising it would generate $4,000 increased income for everyone else. Did you receive it?In reality, the super-wealthy don’t create jobs or raise wages. Jobs are created when average working people earn enough money to buy all the goods and services they produce, pushing companies to hire more people and pay them higher wages.The second myth is the “free market”.The ultra-rich claim they’re being rewarded by the impersonal market for creating and doing what people are willing to pay them for.The wages of other Americans have stagnated, they say, because most Americans are worth less in the market now that new technologies and globalization have made their jobs redundant.Baloney. Even if they’re being rewarded, there’s no reason why the “free market’ would reward vast multiples of what the rich were rewarded with decades ago.The market can induce great feats of invention and entrepreneurship with lures of hundreds of thousands or even millions of dollars – not billions.As to the rest of us succumbing to labor-replacing globalization and labor-saving technologies, no other advanced nation has nearly the degree of inequality found in the United States, yet all these nations have been exposed to the same forces of globalization and technological change.In reality, the ultra-wealthy have rigged the so-called “free market” in the US for their own benefit. Billionaires’ campaign contributions have soared from a relatively modest $31m in the 2010 elections to $1.2bn in the most recent presidential cycle – a nearly 40-fold increase.What have they got for their money? Tax cuts, freedom to bash unions and monopolize markets and government bailouts. Their pockets have been further lined by privatization and deregulation.The third myth is that they’re superior human beings.They portray themselves as “self-made” rugged individuals who “did it on their own” and therefore deserve their billions.Bupkis. Six of the 10 wealthiest Americans alive today are heirs to fortunes passed on to them by wealthy ancestors.Others had the advantages that come with wealthy parents.Jeff Bezos’s garage-based start was funded by a quarter-million-dollar investment from his parents. Bill Gates’s mother used her business connections to help land a software deal with IBM that made Microsoft. Elon Musk came from a family that reportedly owned shares of an emerald mine in southern Africa.Don’t fall for these three myths.Trickle-down economics is a cruel joke.The so-called free market has been distorted by huge campaign contributions from the ultra-rich.Don’t lionize the ultra-rich as superior “self-made” human beings who deserve their billions. They were lucky and had connections.In reality, there is no justification for today’s extraordinary concentration of wealth at the very top. It’s distorting our politics, rigging our markets and granting unprecedented power to a handful of people.The last time America faced anything comparable was at the start of the 20th century.In 1910, former president Theodore Roosevelt warned that “a small class of enormously wealthy and economically powerful men, whose chief object is to hold and increase their power” could destroy American democracy.Roosevelt’s answer was to tax wealth. The estate tax was enacted in 1916, and the capital gains tax in 1922.Since that time, both have eroded. As the rich have accumulated greater wealth, they have also amassed more political power – and have used that political power to reduce their taxes.Teddy Roosevelt understood something about the American economy and the ultra-rich that has now re-emerged, even more extreme and more dangerous. We must understand it, too – and act.
Robert Reich, a former US secretary of labor, is professor of public policy at the University of California, Berkeley and the author of Saving Capitalism: For the Many, Not the Few and The Common Good. His new book, The System: Who Rigged It, How We Fix It, is out now. He is a Guardian US columnist. His newsletter is at robertreich.substack.com
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ExplainerWhy is the White House having its first hunger conference in 50 years?The Biden administration is hosting a conference to coincide with a new hunger and nutrition plan – what can it achieve? What’s happening?The Biden administration is hosting a one-day conference on Wednesday on hunger, nutrition and health, bringing together advocates, researchers and activists and leaders in business and philanthropy, faith groups and communities around the US.Just before the conference, the administration launched its strategy aimed at ending hunger in the US by 2030 with plans to expand benefits and access to healthy food. The conference will be streamed live from 9am ET on the White House Youtube channel, with Joe Biden expected to make remarks in the early afternoon. The strategy and conference are aimed at making “America truly a stronger, healthier nation”, he says.But it all comes at a difficult time for many households as pandemic support measures fall away, record inflation and rising food prices (linked to climate breakdown, Russia’s war in Ukraine and Covid supply issues) squeeze budgets, and just before November’s midterm elections.When was the last food conference?The last food conference, hosted by Richard Nixon in 1969, was a pivotal moment in American food policy that led to the expansion of food stamps and gave rise to the Women, Infants and Children program that today provides parenting advice, breastfeeding support and food assistance to the mothers of half the babies born each year.How bad is hunger in the US now?One in 10 households struggled to feed their families in 2021 due to poverty – an extraordinary level of food insecurity in the richest country in the world. The rate has barely budged in the past two decades amid deepening economic inequalities and welfare cuts.Food insecurity remains stubbornly high in the US, with only a slight downward trend from 2021 – but significantly lower than 2020 when the Covid shutdown and widespread layoffs led to record numbers of Americans relying on food banks and food stamps to get by.The conference comes as the cost of food is soaring due to double-digit inflation, and amid fears of recession. The cost of groceries in July was up 13.1% compared with last year, with the price of cereal, bread and dairy products rising even higher, according to the Consumer Price Index.Households are under more pressure as states roll back pandemic-linked financial support such as free school meals for every child and child tax credits. Many states are stopping expanded food stamp benefits.Real-time data from the US Census survey “suggest that food hardship has been steadily rising in families with children this year”, Diane Whitmore Schanzenbach, director of the Institute for Policy Research at Northwestern University, recently told the Guardian.What are the main parts of the administration’s strategy?It includes multiple ambitious goals but few concrete measures, as the plans depend on securing support from a polarised Congress, which so far this year has refused to extend the child tax credit and universal free school meals – both of which led to historic improvements in food security in the wake of the pandemic.‘The kids are just happier’: could California’s universal school meal program start a trend?Read moreThe plan states that the administration is committed to “pushing for Congress to permanently extend the expanded, fully refunded child tax credit and expanded Earned Income Tax Credit … to raise the minimum wage to $15 an hour; close the Medicaid coverage gap; invest in affordable, high-quality child care; and expand the Housing Choice Voucher”.The strategy also aims to cut diet-related diseases by increasing access to healthy food and exercise as new data shows that more than 35% of people in 19 states and two territories are obese – more the double the number of states in 2018 – while one in 10 Americans have diabetes.It includes proposals to reform food packaging, voluntary salt and sugar reduction targets for the food industry, and working to expand Medicaid and Medicare access to obesity counselling and nutrition.According to Andy Fisher, researcher and author of Big Hunger, the strategy includes lots of great ideas but lets the food industry off the hook and fails to adequately address the impact of racism, misogyny or the climate crisis on food inequality.“What they don’t realize or say is that hunger and health disparities are baked into our political and economic system, and require much more than these technocratic policy reforms.”TopicsBiden administrationHungerInequalityUS politicsJoe BidenexplainersReuse this content More
White House announces internet program for low-income AmericansWith new commitment from 20 internet providers, about 48m households will be eligible for $30 monthly plans The Biden administration announced on Monday that 20 internet companies have agreed to provide discounted service to people with low incomes, a program that could effectively make tens of millions of households eligible for free service through an already existing federal subsidy.The $1tn infrastructure package passed by Congress last year included $14.2bn in funding for the Affordable Connectivity Program, which provides $30 monthly subsidies ($75 in tribal areas) on internet service for millions of lower-income households.Jill Biden makes unannounced visit to Ukraine and meets first ladyRead moreWith the new commitment from the internet providers, about 48m households will be eligible for $30 monthly plans for 100 megabits per second, or higher speed, service – making internet service fully paid for with the government subsidy if they sign up with one of the providers participating in the program.Biden, during his White House run and the push for the infrastructure bill, made expanding high-speed internet access in rural and low-income areas a priority. He has repeatedly spoken out about low-income families have struggled to find reliable wifi, so their children could take part in remote schooling and complete homework assignments early in the coronavirus pandemic.“If we didn’t know it before, we know now: high-speed internet is essential,” the Democratic president said during a White House event last month honoring the National Teacher of the Year.The 20 internet companies that have agreed to lower their rates for eligible consumers provide service in areas where 80% of the US population, including 50% of the rural population, live, according to the White House. Participating companies that offer service on tribal lands are providing $75 rates in those areas, the equivalent of the federal government subsidy in those areas.Biden and Vice-President Kamala Harris on Monday were set to meet with telecom executives, members of Congress and others to spotlight the effort to improve access to high-speed internet for low-income households.The providers are Allo Communications, AltaFiber (and Hawaiian Telecom), Altice USA (Optimum and Suddenlink), Astound, AT&T, Breezeline, Comcast, Comporium, Frontier, IdeaTek, Cox Communications, Jackson Energy Authority, MediaCom, MLGC, Spectrum (Charter Communications), Starry, Verizon (Fios only), Vermont Telephone Co, Vexus Fiber and Wow! Internet, Cable and TV.American households are eligible for subsidies through the Affordable Connectivity Program if their income is at or below 200% of the federal poverty level, or if a member of their family participates in one of several programs, including the Supplemental Nutrition Assistance Program (Snap), Federal Public Housing Assistance (FPHA) and Veterans Pension and Survivors Benefit.TopicsUS newsBroadbandInternetBiden administrationIncome inequalityTelecommunications industryUS politicsnewsReuse this content More
‘What am I going to do?’: soaring prices fuel calls for US government to step inLarge corporations are passing on higher-than-needed price increases to customers under the cover of inflation, war and supply chain squeezes, experts say Outside a Dollar Tree in Detroit, Latasha Holmes lamented the rising cost of toilet paper, beverages, food and other items she had just purchased. The price increases, she said, were forcing her to choose among necessities for her and four kids.“What am I going to do? Prices are up everywhere, all over town,” she said. “I can’t afford everything.”But while Holmes struggles, Dollar Tree thrives. The retailer increased its prices by 25% as profits jumped 269% between 2019 and 2021, and its profit margins widened. Shareholders won too. The company also announced a stock buyback program worth $1bn that will deliver cash from those price increases to its investors.Dollar Tree and other large corporations are juicing profits by passing on higher-than-needed price increases to customers like Holmes under the cover of inflation, war and supply chain squeezes, consumer advocates and economists say. They are calling for the federal government to take bold steps to rein in the companies.Revealed: top US corporations raising prices on Americans even as profits surgeRead moreAmong proposed prescriptions are price controls, improved price fixing rules, commodity market intervention, stock buyback regulation and antitrust enforcement. Ranged against those proposals are a powerful business lobby and a divided Congress that seems unable to pass major legislation.“There are reasons to have a profit incentive, but there are also reasons to have an overall regulatory body that can say, ‘This is actually profiteering … while everyone is hurting,’” said Krista Brown, a policy analyst with the American Economic Liberties Project.A Guardian analysis of 100 top corporations’ Securities Exchange Commission filings found a median increase of 49% in profits between the most recent quarter and the same quarter two years ago, pre-pandemic. It shows companies have largely shielded themselves from inflationary pain by passing most or all of their increased costs on to customers via price hikes.So far, the federal government’s most visible attempt to address inflation has been to increase interest rates, rates look set to rise again this week. But the Guardian’s data suggests such a measure may miss an important mark. Raising rates effectively takes money out of consumers’ pockets to cool the economy.If corporate profits are contributing in a meaningful way, then raising rates would only reduce the amount of money people have to spend on products and services for which prices are still going up.“That would mean you’re exacerbating this dynamic instead of doing anything to help it,” said Isabella Weber, University of Massachusetts Amherst economist.Instead, limited and targeted price controls could work for essentials like bread, she said, but stressed those would have to be coupled with a bailout plan for negatively affected companies.“Increased prices for basic items like bread can exert enormous pressure on wages” and send inflationary ripples throughout the economy, Weber added. Though price controls are controversial and generally regarded as a leftist idea, the last president to enact them was Richard Nixon, who imposed a 90-day freeze on wages and prices to address inflation in 1970. Price controls were also enacted during and following the second world war, when, again, supply chain issues and pent up demand led to soaring prices.Table of 100 US companies’ profit growthBut price rises are not the only issue critics would like to see the Biden administration address. Others, like Groundwork Collective’s executive director, Lindsay Owens, have called for a ban or new restrictions on stock buyback programs. Joe Biden’s 2023 budget proposes prohibiting executives from selling their stock three to five years after enacting a buyback program.“The other big winner besides the shareholders in excess cash that’s going to buybacks are the executives,” Owens said. “They announce the buybacks, their stock prices soar, then they sell their shares and there are a number of ways to make this work better.”The Guardian’s analysis found companies’ buyback programs over the last 15 months totaled $544bn. That cash could have been reinvested to keep prices down, or increase workers’ wages, consumer advocates say.Others levelled accusations of price fixing and gouging. The American Economic Liberties Project is helping draft legislation that would make it easier for businesses to sue companies for price fixing by making private corporate communications more accessible. As of now, only 3% of price fixing cases make it to trial, Brown said.“Reinvigorating price fixing laws and going after price gouging in moments like this, where a war or Covid are used as excuses for companies to raise rates just because they can, could help a lot,” she added.Fixing is especially a problem in highly consolidated industries, consumer advocates say. Companies have benefited from “decades long under-enforcement of consolidation laws”, added Martin Schmalz, an Oxford University economist.Just four companies control most of the US beef industry, four airlines control about 80% of domestic passenger traffic, Walmart accounts for the majority of grocery sales in the majority of US states, the list goes on and on.And it’s not just the companies that have outsized control. Large investors also a role to play.Schmalz pointed to the Investment Company Act, which limits investment funds to holding no more than 10% of a corporation’s securities. Vanguard on average holds 10% of all S&P 500 companies, Schmalz research has found, but it is not violating the law because companies within its fund family own the shares, not Vanguard itself. But Vanguard still executes the voting rights of more than 10% of shareholders.“The law is written at the fund level so technically speaking they don’t violate the law, but they are violating the spirit of the law,” Schmalz said.Economists and attorneys working on US antitrust law have proposed prosecuting mutual funds like BlackRock or Vanguard that own large stakes in multiple companies in the same sector. Such shareholders can exert an outsize influence on companies’ pricing decisions, Schmalz said, and he noted Investment Company Act language that specifically targets this scenario: “The national public interest … is adversely affected … when investment companies [have] great size [and] excessive influence on the national economy.”Schmalz said there’s little discussion among policymakers to address that specific issue.Biden’s budget includes over $220m for antitrust enforcement, and bills that would break up large tech companies have bipartisan Senate and House support.The Guardian’s analysis highlighted the commodity market boom as companies trading in grain, steel, mining, wood, rubber, meat, oil, homes and other materials generally recorded higher profit increases than companies across the rest of the economy.However, many commodity companies operate in what analysts characterize as “feast and famine” cycles in which they’re unprofitable for years before cashing in. The pendulum has swung for many commodity companies in the day’s economic climate.“When there’s a chance to raise prices when markets are tight, companies are going to do so,” said Skanda Amarnath, executive director of the Employ America thinktank. “It’s some part opportunistic, some part greed, some part rationality, some part a response to uncertainty.”The oil industry highlights the dynamic. After seven years of low returns, it’s restricting supply to boost profits regardless of how that hits Americans at the pump. Earnings calls transcripts reveal executives eagerly “putting shareholders first” and an investor who described industry-wide supply suppression “one of the delights of this earnings season”.Bar chart of the monthly change in US wages since January 2019Bringing volatile commodity prices under control would require curtailing uncertainty and building supply chain resiliency, analysts who spoke with the Guardian say. That could involve some degree of government intervention to cut down on risk by establishing a floor on commodity prices. The government could do that by effectively becoming the “buyer of last resort” when material prices dip below a certain level.But the government should also set a ceiling above which it collects profits, said commodities analyst Alex Turnbull. He suggested the federal government set up what’s effectively a state reserve board.Turnbull pointed to lithium, which, amid increased demand for EV batteries and supply chain squeezes, jumped from $5,000 a ton to $45,000 a ton last year. Higher prices impact the pace of the clean energy transition, and the government could hypothetically set a $10,000 a ton floor price and $25,000 a ton ceiling that would limit the volatility, Turnbull said.The federal government could also increase stockpile reserves of products like grain or oil that are released when prices spike.“That sends the message ‘You should plant more wheat because if it goes really bad, you might have a lean year or two, but we will buy your wheat. But on the other hand don’t expect to buy a Lamborghini if you’re a farmer in Iowa because when prices get too high we’ll be out there selling the shit out of our stockpiles,’” Turnbull said.Stabilization may also spur investment in raw material production that’s risky, which would further bolster markets against future supply shortages. Few companies have built steel plants in recent years because the prices have been so low, Turnbull noted, and now the world is short on steel.Though price caps are “not politically palatable” Bespoke Investment analyst George Pearkes said, the government could take a number of measures to steer futures curves and markets for raw commodities like oil and wheat.“Something in between where there are strategic efforts to smooth volatility, and provide the private sector with enough certainty that they can make decisions is a lot more compelling,” he said.Spikes in investment for some commodities, like nickel, that are essential to the clean energy transition, can be a positive development, Turnbull said. Mining companies limped through the several years leading up to the pandemic, but reaped windfalls over the last year.“People say ‘Nickel producers are making too much money’, well, they didn’t make money for a decade,” Turnbull said. “At some point, somebody has to put money down to dig holes because people aren’t going to drive to the middle of fucking nowhere with a truck and work for free.”Another force in some commodity price spikes: Wall Street speculation. Commodity markets were once heavily regulated because they deal in raw materials that underpin the economy. An influx of investment capital followed the commodity markets’ deregulation about 20 years ago, and some are now treated like speculative assets similar to bitcoin, said Rupert Russell, who authored a book on the topic.The consequences of economy-addling commodity price spikes are real, he adds, pointing to the 2010 grain prices that helped trigger the Arab spring uprising in Tunisia.Supply chain back ups, inflation and war have generated “radical uncertainty” in which no one knows how much commodities are worth, because the prices are no longer anchored, Russell told the Guardian. He echoed others’ calls for stronger government intervention to tamp down the casino-like mentality.“Once there’s not just radical uncertainty but markets dominated by speculators, algorithmically driven speculation that is just kind of responding to headlines, then you’re going to get that kind of Bitcoin-esque volatility,” he said.But experts say there are few viable short-term solutions, and long-term measures don’t help Holmes. That’s forcing her to think about getting another job to survive as she feels the pressure of an economic system stacked against her.“I don’t want to. I’ve got four kids to take care of, but what am I supposed to do?” she asked.TopicsUS economyInflationEconomicsUS politicsUS income inequalityInequalityfeaturesReuse this content More
Tax the rich: these one percenters want people like them to pay higher taxesMembers of the Patriotic Millionaires say the income gap in the US has become a disaster – and it’s time to ‘take that money back’ The sound system played Pink Floyd’s Money as the Patriotic Millionaires assembled in the boutique Eaton hotel in Washington DC last week. After compulsory Covid tests there was a lot of well-heeled hugging and laughter among a crowd that looked like extras from Succession as they sat down at tables stacked with M&Ms stamped with “tax the rich”.This was the first time since the pandemic that the Patriotic Millionaires had assembled together in person. The group, founded in 2010, is made up of high net worth individuals who believe – counterintuitively these days – that the really rich should pay more taxes. And after a dozen often frustrating years some of them now believe change is coming.In the White House, Joe Biden has proposed new taxes on households worth more than $100m. The war in Ukraine has shown that the international community can, and will, crack down on oligarchs. Some of the workers who made fortunes for Amazon’s Jeff Bezos and Starbucks’s Howard Schultz have successfully formed unions despite the millions both companies spent fighting them off.“No one was talking about taxing the rich when we started,” said Morris Pearl, chair of the Patriotic Millionaires and a former managing director at BlackRock, the largest money manager in the world.Even the conversation seemed ridiculous under Donald Trump, Pearl added. “We have seen a huge change. You have a president talking about taxing the rich, people are talking about wealth taxes – those weren’t even fringe ideas 10 years ago. I’m not saying it’s going to happen and pass into law but there are conversations at the highest levels.”Part of the reason why those conversations are happening is that the situation has got so bad. Speaker after speaker at the one-day conference highlighted how the very, very rich have hijacked the political system around the world, run down wages and exacerbated income inequality, ramming home the title of the conference: Oligarchs vs All of Us: The Fight for Power & Money.Another member, Gary Stevenson, a British trader turned inequality economist, believes things are only going to get worse. Billionaires made fortunes from soaring stock markets, property prices and other assets during the pandemic. Government handouts have largely helped the rich, he argues. “If nothing is done this is going to be a massive disaster,” he said. “However bad you think things are, I guarantee they will get much, much worse.”When the pandemic struck there was talk of it being a great leveler – we were all in this together. In fact, Covid-19 exacerbated economic and racial inequalities. US billionaires received a $1.1tn windfall as their wealth soared to record levels. The billionaire class boomed in Asia and reached record levels in the UK. But as we emerge from the shadow of Covid-19, hoi poloi find themselves struggling with soaring inflation and rising cost of basics such as rent, utilities and food.For Stevenson this enormous explosion of wealth is “end of civilization stuff”. “There is one thing and one thing only that we can do,” he said. “We have got to take that money back.”But are rich – and overwhelmingly white – people the right people to push that message? Abigail Disney thinks so. Disney, the granddaughter of Roy Disney, co-founder of the Walt Disney Company, sees her family as a synechdoche for what has happened to the rest of America.The Disneys were already super-rich by the time Disney, 62, was born but their wealth grew enormously just as the gap between rich and poor has grown. “Money changed my family,” she said, and not for the better. Now, she says, those rich people live in another world and are unable to see what the consequences of rising inequality will be. Hearing that from one of their own breaks that barrier, she believes.“The only people billionaires will listen to are other billionaires and multimillionaires. You need at least the two commas. And if they won’t listen, there are their children and their wives, and they will listen,” she said.While her money opens the doors of power, Disney finds her message also discombobulates ordinary Americans. She is regularly assailed on Twitter for daring to suggest rich people should pay more taxes. The problem is that people have been convinced that “every single person in this country is a billionaire waiting to happen”, in an orchestrated campaign she believes was engineered to protect the wealth of the 1%.The last four decades have seen a massive redistribution of wealth. Only problem is it went to those who were already wealthy. https://t.co/anTolPYv5g— Abigail Disney (@abigaildisney) April 5, 2022
Hearing one of the 1% suggest that maybe that dream is a nightmare makes people crazy, she said. “The pushback I get is: ‘You never worked a day in your life! You don’t know anything!’ Well, you are right, you are making my point for me! I should not have this power and influence. Just keep making my point for me,” she said.“For me to be speaking out against my own supposed self-interest has a wow factor that catches the attention. I don’t want to ever stop doing that. We need to model what it looks like to not defend your own self-interest all the time. When you are fine and other people are not, you put aside your own self-interest and stick up for somebody else.”The chance of Biden’s tax cuts making it through Congress are slim. US politicians rely too heavily on the wealthy and some Democrats as well as Republicans will balk at taxing them more. But Disney argues that the debate has changed. After the pandemic, US oligarchs aren’t the heroes they once were and, notably, Republicans have so far steered clear of an all-out attack on Biden’s proposal.“Four years ago if you’d said ‘billionaires tax’ then they would have said you can’t bash billionaires, you’re encouraging class warfare. I haven’t heard a whiff of that,” said Disney. “Let’s not kid ourselves, the other side has tested that and found it isn’t working. That class war rhetoric isn’t working any more. And that’s good news. Because if we don’t ruffle some feathers now, we are going to have a class war. A real one.”TopicsUS income inequalityIncome inequalityUS politicsInequalityUS taxationfeaturesReuse this content More
Covid had devastating toll on poor and low-income communities in USPoor People’s Pandemic Report concludes that while virus did not discriminate between rich and poor, society and government did The devastating impact of the Covid-19 pandemic on poor and low-income communities across America is laid bare in a new report released on Monday that concludes that while the virus did not discriminate between rich and poor, society and government did.As the US draws close to the terrible landmark of 1 million deaths from coronavirus, the glaringly disproportionate human toll that has been exacted is exposed by the Poor People’s Pandemic Report. Based on a data analysis of more than 3,000 counties across the US, it finds that people in poorer counties have died overall at almost twice the rate of those in richer counties.Looking at the most deadly surges of the virus, the disparity in death rates grows even more pronounced. During the third pandemic wave in the US, over the winter of 2020 and 2021, death rates were four and a half times higher in the poorest counties than those with the highest median incomes.During the recent Omicron wave, that divergence in death rates stood at almost three times.Such a staggering gulf in outcomes cannot be explained by differences in vaccination rates, the authors find, with more than half of the population of the poorest counties having received two vaccine shots. A more relevant factor is likely to be that the poorest communities had twice the proportion of people who lack health insurance compared with the richer counties.“The findings of this report reveal neglect and sometimes intentional decisions to not focus on the poor,” said Bishop William Barber, co-chair of the Poor People’s Campaign which jointly prepared the research. “The neglect of poor and low-wealth people in this country during a pandemic is immoral, shocking and unjust.”The report was produced by the Poor People’s Campaign in partnership with a team of economists at the UN Sustainable Development Solutions Network (SDSN) led by Jeffrey Sachs. They have number-crunched statistics from more than 3,200 counties as a way of comparing the poorest 10% with the richest 10%.They then interrogate the interplay between Covid death rates and poverty, as well as other crucial demographic factors such as race and occupation.Until now the extent to which the virus has struck low-income communities has been difficult to gauge because official mortality data compiled by the Centers for Disease Control and Prevention (CDC) and elsewhere has not systematically factored in income and wealth information.The new report seeks to fill that gaping hole in understanding of the US pandemic. One of its most striking findings is that within the top 300 counties with the highest death rates, 45% of the population on average lives below the poverty line as defined as 200% of the official poverty measure.Sachs, a Columbia University professor who is president of the UN SDSN, said the findings underlined how the pandemic was not just a national tragedy but also a failure of social justice. “The burden of disease – in terms of deaths, illness and economic costs – was borne disproportionately by the poor, women, and people of color. The poor were America’s essential workers, on the frontlines, saving lives and also incurring disease and death.”The authors rank US counties according to the intersection of poverty and Covid-19 death rates. Top of the list is Galax county, a small rural community in south-west Virginia.Its death rate per 100,000 people stands at an astonishing 1,134, compared with 299 per 100,000 nationally. Median income in the county is little more than $33,000, and almost half of the population lives below the poverty line.Among the counties with punishingly high poverty and death rates is the Bronx in New York City, where 56% of the population is Hispanic and 29% Black. More than half of the borough lives under the poverty line, and the Covid death rate is 538 per 100,000 – within the highest 10% in the US.Racial disparities have been at the centre of the pandemic experience in the US. Early on it became clear that Black people and Hispanics in New York City, for instance, were dying of Covid at twice the rate of whites and Asians.The consequences of such racial inequity are still only now becoming visible. Last week a study in the journal Social Science & Medicine reached a disturbing conclusion.It found that when white Americans were informed through the media that Black Americans were dying at higher rates than their demographic group was, their fear of the virus receded and they became less empathetic towards those vulnerable to the disease. They were also more likely to abandon Covid safety precautions such as masks and social distancing.But low-income predominantly white communities are also in peril. Mingo county in West Virginia, for example, has one of the lowest income levels in the US following the collapse of coal mining and the scourge of the opioid epidemic.The county is 96% white, with over half its residents living below the poverty line. Its Covid death rate is 470 per 100,000 – putting it within the top quarter of counties in the nation for pandemic mortality.TopicsCoronavirusOmicron variantUS politicsInequalityPovertynewsReuse this content More
