How Insanely Concentrated Wealth is Strangling Collective Prosperity

by Paul Nelson 

Insanely Concentrated Wealth Is Strangling Our Prosperity” is the title of a recent article on a website that proposes to offer ways in which we can, as a country, address what one amateur economist calls the worst income inequality in the history of time.

The article’s sub-heading is, “Today’s amounts of wealth throttle the very engine of wealth creation itself.” The website is called: “Evonomics” and the author of this piece is Steve Roth, a Seattle resident who agreed to talk about his article.

The following interview has been lightly edited for clarity.

Paul Nelson: Can you tell us about the Evonomics website?

Steve Roth: Evonomics was founded by founding Editor Robert Kadar. He and I were both working for The Evolution Institute. He was the editor of “This View of Life” online magazine about topics evolutionary. “Evonomics” looks at economics through an evolutionary lens of competition and cooperation, survival of the fittest, the common ideas between evolution and economics. Robert decided to launch this site called Evonomics. I was very interested, because two of my huge intellectual passions are economics and evolution.

I was like, “Yeah, nobody’s going to want to read that.” Within a few months he was getting a quarter million page views a month. For the last two years Robert and I have been working on building it up, and we’re currently reaching millions of people a week on Facebook and getting hundreds of thousands of page views. The average person reads an article for five minutes, which is off the charts for website metrics.

Nelson: In this era.

Roth: In this era, right. The one thing I want to add is it’s not just about evolution economics anymore. We settled on the tagline, the next evolution of economics, which lets us do a much broader variety of content and topics. Wherein, what I like to consider in the economic scene is what I like to call a very non-Kuhnian moment. Thomas Kuhn wrote “The Structure of Scientific Revolutions.” You’ve heard of paradigm shifts before. He’s the guy that came up with that idea. The idea in that book is that a new paradigm comes along and replaces or supersedes: Copernicus, Einstein, Newton [are examples].

We’re in a fascinating period in economics where the traditional paradigm is crumbling (or is crumbled) — where many, or most have huge difficulties with its basic premises, but unlike a Kuhnian revolution, no single paradigm has replaced that. There is what you might describe best as a whole plethora of competing research projects, where people are going at how the economy works in many different very diverse ways, and we’re trying to be a place for that, see change to be read about and understood.

Nelson: As you were talking, I was thinking about the evolution of economics, and it seems to me there is an exact parallel between the devolution of our electoral system, and the person representing the country at this time the 45th President of United States and the current economic situation, both are so horribly wrong and horribly out-of-date and horribly inept at addressing the situation that we have today, would you say that’s accurate?

Roth: Yeah. I would actually take it far more broadly to look at basically the economy over the last century. We had a Gilded Age in the 20s, crashed in ’29. Basically, we got the new deal where a huge amount of progressive agenda was enacted and put in a great deal of redistribution and social support programs. They simply built the spring board and platform that allowed tens of millions of Americans to stand up and change the world. The period after and then we had World War II where we ran our national data up to 120% of GDP, and the period that followed that was the greatest burst of widespread prosperity and well-being in the history of the United States.

It was just spectacular what was delivered unto the normal person in that period. That started to fade basically after Roosevelt. Truman was okay. Kennedy delivered the most massive tax cut for rich people we’ve seen in forever in 1964. (It was implemented in 1964.) Then came the Reagan “revolution.” If you look at any economic metrics, the economy has basically sucked and increasingly sucked ever since. The implementation trickled down, which actually started with that Kennedy tax cut has strangled our economy.

Nelson: Trump is so horribly unqualified, but you’re talking about the problem going back to Kennedy who has looked back as maybe one of the last good presidents. Jimmy Carter’s tenure was seen as unsuccessful, and he was not reelected. If people liked Kennedy, Trump is fathoms and fathoms worse than that.

Roth: Understand that I can’t help idolizing Kennedy. I have here a postcard that I keep on my computer screen of John-John and Catherine dancing in the Oval Office, with John F. Kennedy and it still brings tears to my eyes, but I know he was no paragon of progressive values and virtues. I think most progressives understand that, or I hope they do.

Nelson:  I’m not so sure they do, because I think the era that you’re talking about starting with Jimmy Carter continued with what you called the Reagan “revolution.” I would call that a “devolution.”

Roth: Right.

Nelson: That’s really neo-liberalism and that’s the problem we have now, because we have neoliberals saying, “No, we need to elect someone who’s more like the way things are and who’s not that far out, Hillary Clinton, and we see what happens.”

Roth: Yeah.

Nelson:  We will talk about the neoliberal period, but I’d like to get a sense of your background. You’re calling yourself a student of economics and evolution.

Roth: I have had a very varied career. The last real job I had was loading chair lifts at the ski area in 1980. I was a ski bum.

Nelson: To me, that suggests you’ve been hugely successful, because you’ve been able to live your life the way you want to live it.

Roth:  I have been. Right, well, I was lucky I was born to a prosperous family. My dad was a classic 1960s St. Louis, do-gooder, Jewish lawyer, national board of the ACLU, health and hospitals, aid the victims of crime. He was that kind of guy and that’s been imbued in me, but I was also quite prosperous, I was lucky. I was able to start my own businesses, and I did quite well. I’m not wildly rich, but I’m very comfortable, because of the month, built and sold quite a few, and I’m an equity investor in various things now. I was lucky. I started on third base. In the process, I’ve built a lot of businesses, and I’ve really come at this whole thing very much from that perspective.

I’m also just naturally a sort of intellectual guy, and I get super interested in things. I got super interested in economics in about 15 years ago, I started studying that hard and started writing a blog, which is how I figure out what I think or try and work through poems. I’m totally an autodidact, a self-trained student of economics that result in some spotlight knowledge that an autodidact ends up with. I don’t have some of the broader stuff that you would get if you went to graduate school for instance, so I’m a self trained student of economics, but I’ve studied hard and read thousands and thousands of things.

Nelson: The gap between rich and poor in the United States at this time is the greatest gap in the history of time, isn’t it?

Roth: I think it is, it’s hard to say, but if you look at Thomas Piketty’s work, we’re certainly at or above where we were in the late 19th century and early 20th century. This raises a point about the article I wrote is that wealth has always been extremely difficult thing to measure, because basically rich people don’t want to tell you for very obvious reasons.

Nelson: They don’t want to tell you how much they have or where they’ve hidden it.

Roth: Right, exactly. I think Piketty’s colleague Gabriel Zucman has said, “There’s at least $20 trillion in household wealth hiding in the world just for a benchmark, U.S. household wealth that’s $100 trillion.”

Nelson:  How much?

Roth: About $20 trillion. Now the $20 trillion is from worldwide.

Nelson: Right. Those are in the mattresses somewhere in the world, right?

Roth: Yeah, they’re in the labyrinths.

Nelson: Right, the gap between rich and everyone else in this country?

Roth:  Yeah, the top 1/100th of 1% in the U.S. today, for instance, 2014, I think had about average $420 million in 2014. In the 70s and the 80s that was more like 30 million, so they have 12 times as much as they did then, and they already had a huge amount. Anybody below the top 10%, it’s almost invisible how much wealth they have individually compared to that.

Nelson: Compared, yeah. You say these people could spend 20 million every year, and they’d still just keep getting richer even if they did absolutely nothing except choose some index funds.

Roth: And shop for a yacht for their 8 year old. Yeah, we pay people for two things in this world; we pay them for doing things, and we pay them for owning things. Increasingly, it’s been the later. Much of that ownership income and people like to call it investment income, but if you have $420 million, you put it in a handful of index funds and never touch it and you’ll easily can spend 20 million a year and still get richer…

Paul Nelson is a poet, interviewer, father and literary activist engaged in a 20-year bioregional cultural investigation of Cascadia. He currently lives in the Rainier Beach neighborhood.

Featured image is a cc licensed photo attributed to MSeattle

One thought on “How Insanely Concentrated Wealth is Strangling Collective Prosperity”

  1. Evonomics is one of my favorite websites, simply because it challenges the dominant economic paradigm in so many intelligent ways. In this case, Roth could have added that Donald Trump is the direct product of this absurd inequality of wealth and income – the result of voter frustration over the corruption of both the Democratic and Repubican Party establishments. But that it wasn’t just Reagan, but also the Clintons, Bushes, and Obama who helped set the stage. And also that limits-to-growth would be a huge problem even without inequality. And that a real science of economics would be based on complexity theory and the energy and resource cycles of planet earth (= Gaia).