The Real Redistribution of Wealth: Forbes 400 Triple Wealth in 5 years

SQATTABLE – 03/09/2011

If you’ve ever listened to Rush Limbaugh, you’ve probably heard him talk about the “liberals” and their ‘communist/socialist plot” to redistribute the wealth.

But that’s in the make believe Limbaugh-land. In reality, the redistribution of the wealth has already happened, but it was in the opposite of direction of Rush’s claim.

From 1995 to 2000, the Forbes 400 tripled their wealth!

http://wealthforcommongood.org/wp-content/uploads/2009/12/inequality-by-…

Wow, aren’t they ‘good investors’. But looking at the graph got me wondering about the years prior to 1995. So I looked up the source stats, which came from a Fed paper, which I’m not sure can be completely trusted- they cook the numbers everywhere else, so why not here too?

Regardless, the fed paper does have the stats from 1989 and up:

The 400 richest Americans wealth grew:
$49 billion over the 6 year period from ’89-’95
$955 billion over the 5 year period from ’95-’00

During the initial period, the Forbes 400 average income was $20 million per year. Then during the next 5 years their average income increased to $478 million per year. Sounds fair, doesn’t it?

Isn’t this the wealth redistribution Rush is always talking about, but in reverse? As usual, the truth is the exact opposite of Limbaugh’s claims.

Then I started questioning why the Fed Paper started in 1989- was that the first year of the Forbes 400? As it turns out, 1982 was the first year- here’s a chart with the Forbes 400 first 20 years, from 1982 to 2002.

As you can see, the wealth of the uber-rich was growing steadily until the mid 90s, then it shot through the roof. That great sucking sound was caused by NAFTA, which opened the floodgates to outsourcing. Corporations fired workers by the thousands and hired replacements in the third world, often for less than a dollar per day. But that was only the beginning of the great heist.

The top 400 did lose some wealth during the stock market crashes of 1987 and 2000, but it is clear that post-crash, they were still way above their previous levels of wealth. Everyone else that invested in the tech boom didn’t fare so well.

Some of you may recall how MCI Worldcom was poised to own the internet with it’s fiber optic dominance. So millions of Americans invested in what they thought was a secure investment, the future of the internet. But then MCI overstated it’s earnings by $11 billion, causing the stock to plunge to zero. Millions were devastated, $150 billion in stock was wiped out, goodbye retirement suckers!. But Worldcom only had to wait a year, pay a measly $500 million fine, and they were back in business, as the very same day the fine was announced, they received a $45 million gov’t contract to help rebuild Iraq, in addition to the annual $750 million in federal contracts. Two guys went to jail, the rest took the money laughing all the way to the bank.

This redistribution has worked our really well for the elite, well connected and already super wealthy, but what of the rest of us?

As we have grown accustomed to the two income families still unable to to make ends meet, now having three jobs to get by has become ‘uniquely American’. The loss of jobs due to outsourcing, combined with illegal schemes to steal American’s homes through foreclosures, has put millions of Americans on the streets homeless. Millions of America’s children are homeless, struggling to get through school every day underfed and with no stability whatsoever. Millions of Americans freezing on the streets every night even as millions more homes sit empty, because of bankers with no soul. … Full article

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