Over the last two generations, we have begun to build a remarkably prosperous connected economy. While dominant firms have learned how to manage contractors across vast ecosystems, we have yet to learn how to ensure that everyone who contributes to that prosperity shares in it. Our connected economy is half built.
Extreme inequality is born of dominant firms and the professional class taking the lion’s share of prosperity we all contributed to within exclusionary markets in which the rest of us, from long excluded African-Americans to most recently the white middle-class, have little, if any, power.
The economy is comprised of dominant firms, the vulnerable industries they rely on, and the communities that sustain them both. To prosper, dominant firms need stability. To attain stability, they lean on the rest of us through stabilizing mechanisms, a.k.a. rents and externalities.
rely on vulnerable industries
Extreme wage inequality is the result of dominant firms hoarding the prosperity generated by stabilizing mechanisms. Extreme wealth inequality is the result of the best off bidding up the cost of housing and CEO’s steering profits into large shareholders pockets.
While the dominant firms and the best off people rely on the rest of us in a myriad of ways, they do not share their prosperity with us. A new working class, a mix of whites, recent immigrants and African-Americans, struggles to get by living their lives in service to the professional class.
obstacles and progress
During the era of extreme inequality, mountains of income and wealth have built up in a few counties across the U.S. While these mountains are awesome in appearance, they are also obstacles for the rest of us to progress.
During the era of extreme inequality, the back 80% of us progressed at half the pace of the economy. The professional class progressed one-quarter faster than the economy, the 1% three times faster than the economy.
Every forty years, give or take, the economy doubles. It is now possible for everyone to prosper. Ending poverty is too modest a goal. And as we move forward, everyone should be able to live a still better life.