Nobel laureate economist Joseph Stiglitz writes about inequality in Vanity Fair, Of the 1%, by the 1%, for the 1%.
Americans have been watching protests against oppressive regimes that concentrate massive wealth in the hands of an elite few. Yet in our own democracy, 1 percent of the people take nearly a quarter of the nation’s income—an inequality even the wealthy will come to regret.
While people organize marches and other local actions to support the American middle classes, we learn the Republican House Majority Leader wants to eliminate Social Security and that public sector job cuts undercut job growth.
We also read reports on the earnings of hedge fund managers, showing John Paulson leading again with almost $5 billion in income for a single year. Proving Joseph Stiglitiz correct, the incredibly wealthy hedge fund speculators receive a colossal benefit for their financial supports to Congress,
The most amazing aspect of all these windfalls? Hedge fund managers enjoy what may be the most outrageous tax loophole ever. The infamous “carried interest” loophole lets them define most of their income as a capital gain.
The result: On every $1 billion in carried interest income, they save a whopping $200 million in taxes.
Categories: Income Inequality