What if the super-rich lost 40 % of their wealth? A CNN hypothetical question
6.15.12--Democratic strategist and CNN contributor James Carville wrote an intriguing article where he posed this hypothetical scenario: What if the rich lost 40% of their wealth?
What if we woke up and the headlines in all the papers, on television and circulating the Web read the less than one percenters holding the majority of the country's wealth, had lost assets reducing their net-worth to pre-George Bush tax break era? What would the reaction of our government, the Federal Reserve and the media be?
Carville wrote that a hypothetical family who was worth "$126.4 million in 2007, was worth $77.3 million in 2010." The loss was a result of the stock market and housing market crash. The prime real estate areas where the wealthy invested "accounted for 3/4 of the loss." Places like New York City's Upper East Side, Chicago's North Shore, Beverly Hills in Los Angeles, Greenwich, Connecticut and Highland Park in Dallas.
I think we all know what our government and the Federal Reserve would do. We saw their swift reaction when their friends in the financial industry came "a-knocking" after they torpedoed the economy with their borderline fraudulent practices and risky dealings in 2007. Then-Treasury Secretary Henry Paulson, an "Alum" of Goldman Sachs, told us the sky was falling and Washington reacted by propping up that sky with billions in taxpayer money.
But like Carville said, the panic would be triple, while recovery mode kicked into high gear. All the stops would be pulled out to plug the hemorrhaging even of it meant increasing the work week from five days to seven for the masses and rescinding those pesky child labor laws so we could get every availbale pair of hands to generate revenue. After-all, during the Republican presidential race for a candidate, Donald Trump and then BFF Newt Gingrich had proposed we put poor, black children to work as janitors of their schools and on an "Apprentice" for urban needy children.
If they could unabashedly propose something this outrageous during times of normal wealth-hogging, imagine what they would come up with if their coffers dwindled drastically?
Carville devised this fictional America to make a valid point. That Middle Class citizens have lost 40 percent of their networth during the 10 years of Republican tax breaks and are still losing, yet no one is in panic mode or outraged at their dwindling assets. No mass hysteria in the media.
No urgent meeting on Capitol Hill to brainstorm ways to restore the vitality of this section of the population upon whose backs the U.S. economy rests. No Federal Reserve adjustment in rates, no solutions offered or implemented to help restore jobs, homes, small businesses. No MCRP--Middle Class Relief Program like the hurriedly devised Troubled Assets Relief Program (TARP) for "too big to fail" banks and Wall Street.
JPMorgan Chase lost a couple billion dollars recently despite financial reform. The too-big-to-fail bank was made even bigger when they goppled up the collapsing Washington Mutual and Bear Stearns. The brilliant people in Washington thought that the solution to a failed system of huge financial institutions was to make them even bigger.
Now the usual political theater is going on on Capitol Hill where incompetent legislators conduct hearings after hearings with no productive results.
CEO of Chase, Jamie Dimon was hauled before his "friends" on pretense of an inquisition into his bank mega loss. They did the same thing a few months ago with Jon Corzine who also lost almost a billion dollars of his investors money at MF Global in 2011. After hastily resigning from the bankrupt company, he used "he didn't know what happened to the money" defense. I know, real life stranger than fiction, right?
Congress keep doing this same horse and pony show conducted in stunning repetition while nothing changes and the rich continues to get richer, the Middle Class shrinks and the poor is ignored.
Elections roll around and sometimes the key players change but the rotten core remains the same. The systemic corruption has its tentacles wrapped firmly around both sides of the aisle.
To answer the question: if the super-rich lost 40 percent of their wealth, they would still be wealthy by any standards.
Click on this link for some intersting read on the rich tax break-job creation myth: http://www.allvoices.com/contributed-news/12243521-video-the-biggest-lie-to-come-from-the-gop-inwashington-the-rich-creates-jobs
To read more on Jon Corzine and MF Global, click links below:
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