"Skyrocketing wealth ine******y isn’t just wrong. It’s also weakening our economy."

Why is it wrong? How?

"70 percent of the US economy depends on consumer spending. So American consumers need to spend enough money to buy most of the goods and services Americans are capable of producing."
The economy depends not on consumerism, it depends on product production. If products are not produced they can't be bought. Right now, inflation is increasing because there are more dollars (thanks to the Democrats giveaways) than there are goods to meet the demand.

This means that over the long term their incomes need to keep pace with their productivity. As productivity becomes more efficient, goods become less expensive. Case in point, Computers.

"But their incomes haven’t. Over the past 40 years, most people’s wages have basically stagnated , while worker productivity has soared."

Democrat Party policies have been responsible for most of this. They've demolished the middle class, destroyed union jobs, and sent industrial production to foreign countries. The largest unions are now Public Employees. College degrees are worthless because you can now get your degree in Gay G****r Studies in the Medieval Period. They destroyed energy production and stifled business with overreaching environmental regulations instead of common sense solutions. One other note; people live longer and more comfortably than ever. Today's citizen lives better than the Kings and Queens or the wealthiest person of 100 years ago.

"Where did the economic gains go? Mostly to the top. The wealthy now own more of the economy than at any time since the 1920s."

Economic gain didn't go to the wealthy. The wealthy put money back into businesses, charity, investments, entrepreneurial ventures, and R&D. Much of the gains he speaks of went to the government in the form of more taxes to support more Democratic Party pipe dream giveaway programs. In other words, wasted, due to central planning, like a socialist state.

"Here’s the economic problem: The wealthy spend only a small percentage of their income and wealth. Their spending is not enough to fulfill the consumer demand that keeps the economy churning."

What does he think the wealthy do with the rest of their wealth? Hide it under their mattress like a Silas Mariner? Consumer demand does not drive the economy nearly as much as the Production and Development of new products to make life better. We export less than we import. Obviously, there is a demand for imported products

"Lower-income people, on the other hand, spend almost everything they have – which is becoming very little. Most workers aren’t earning nearly enough to buy what the economy is capable of producing."

They do, however, live better than any generation before them and have a better standard of living. healthcare, and life expectancy than the wealthiest people had 100 years ago. Why should workers be able to buy 'everything' the economy produces. Economics involves trade-offs because resources are limited. As Mick Jagger said, "You can't always get what you want, but you just might get what you need."

"The result is a gap between potential output and potential consumption."

That's a pretty dumb statement. There's a real gap between Robert Reich's potential intelligence and real intelligence. Why do you read his nonsense? Because you can't discern between l*****t garbage and how the real world works." L*****ts think they can devise a system in which they can alter Human Nature. They can't! The framers of our Constitution understood this better than anyone.

"To fill the gap, the economy depends on people going deeper and deeper into debt so they can buy. Even in 2018, when the economy appeared strong, 40% of Americans had negative net incomes and were borrowing money to pay for basic household needs."

No, it doesn't. Live within your means. The government needs to learn this lesson also because they have amassed greater debt than all the consumer debt combined. Politicians must really h**e children to leave this crushing debt burden to them. Now, I'll admit that there are some people who through no fault of their own (Usually it's the result of government policies), who can't make ends meet and need help. We have hundreds of government programs to assist these people. However, there are givers and takers and the takers have figured out how to use and l**t the system for their own selfish ends. Why is it that every poor person I see, (not the mentally ill living on the streets) has a cell phone? Is a cell phone a basic household necessity? Okay, how about cable TV? And there are many other examples. Most people need a car to go to and from work but the Biden economic and energy program has caused gasoline prices to skyrocket. Who gets hurt the most by this? The working poor. Their situation improved better with Trump's policies than with any other administration in the past 60 years. Even LBJ's 'Great Society' started the disintegration of the nuclear family and began making people dependent on the government.

"The Fed has had to keep short-term interest rates lower and lower to accommodate this buying. And the government has to spend more and more to fill the remaining gap."

The Federal Reserve answers to no one. All of its' members come from banking and Wall Street financial institutions. As I mentioned earlier, because of quantitative easing there are more dollars chasing fewer goods because people were unwilling to go back to work when they could stay at home and get free money from the government. There is no such thing as a free lunch. Every industry has labor shortages, not due to a decrease in the labor force but because of unavailable workers, 5 million people, who stopped working since the c***d p******c started and decided to stay home to collect government benefits. They could fill these jobs. Even McDonald's can't fill positions and is offering bonuses for just coming in for a job interview.

'None of this is sustainable. At some point, widening ine******y causes the economy to collapse."

Reich throws around all these nuggets of what he thinks is conventional wisdom. His statements are not wisdom at all. He never explains why he believes this to be true. He says it, you're supposed to believe it, because he is the mighty and powerful OZ.


"We’ve seen this before. Years ago, Marriner Eccles, chairman of the Federal Reserve from 1934 to 1948, explained that the Great Depression occurred because the buying power of most Americans fell far short of what the economy was producing."

The great depression was caused because of the over-extension of easy credit and lending without secure collateral. The buying power was curtailed because businesses dried up when there was no money left to fuel the speculative boom. We did the same thing in 2008 with the housing because the leaders in the Democratic Party thought everyone should be able to buy a house, just as in the 1920s people believed everyone could become rich. Easy money makes people lazy and they speculate on potential future gains. Government policies were the problem. Unintended outcomes from these policies were the problem. Then the Politicians come and say "V**e for us and we can save you." Only, they make it worse with more unintended and unforeseen consequences

"He blamed the increasing concentration of wealth at the top: “A giant suction pump had by 1929-1930 drawn into a few hands an increasing portion of currently produced wealth. As in a poker game where the chips were concentrated in fewer and fewer hands, the other fellows could stay in the game only by borrowing. When their credit ran out, the game stopped.”"

Why would any sane person join a high-stakes poker game without an adequate bankroll to back them? Getting and giving credit is a risk. Why would anyone want to borrow on credit for such a foolish risk?

"While the wealthy of the 1920s didn’t know what to do with all their money, most Americans could maintain their standard of living only by going into debt. When that debt bubble burst, the economy tanked."

Speculation and borrowing on margin by greedy people made the system collapse. That takes down the innocent bystanders also.

"Fast forward 100 years and we see the same pattern. While the typical Americans’ wages have barely budged for decades, adjusted for inflation, most economic gains have gone to the top, just as Eccles’s so-called “giant suction pump” drew an increasing portion of the nation’s wealth into a few hands before the Great Depression."

Yes, we see the same pattern but the reasons are all wrong as I have already stated

"The result has been an economy whose underlying structure is far more fragile than it may seem."

Absolutely. So why should we trust the government to fix this when they are at the root of most problems and then only make them worse? The federal debt is the highest it has ever been in peacetime, only surpassed by the debt after the end of WWII. Increasing the debt is insanity and will destroy this country. Exactly what the left wants to do.

"Remember the housing and financial bubbles that burst in 2008? We avoided another Great Depression then only because the government pumped enough money into the economy to maintain demand, and the Fed kept interest rates near zero. Then came the p******c."

2008 resulted in a lot of people losing their homes and leaving more people worse off than before the housing bubble. All of that could have been avoided if common fiscal and monetary sense had been practiced. I***ts like Barney Frank and the Democrats were largely responsible because they don't understand economics.

"The Fed has had to keep interest rates near zero. And the government has had to pump even more money into the economy. While these programs have been crucial to staving off a p******c-induced depression, they’re only temporary."

And the current administration have no basic understanding of economics. I can't think of one person in the Biden Administration, including Schumer and Pelosi, who have ever been in private enterprise. Biden had 47 years to fix this when he was in the Senate. Schumer went straight from law school to elected office. These clowns have never had to build anything. They live off the sweet of hard-working Americans and leave the government richer than what they could possibly have earned from their salaries.

"Over the long term, the real worry continues to be on the demand side. Widening ine******y means not enough demand."

Currently, the problem is too much demand. Too many plentiful dollars chasing after too few goods because of production and supply problems that cheap government money created. Next, the problem will become too much inflation, debt, and high taxes.

"America’s wealth gap is now more extreme than it’s been in over a century. Until this structural problem is remedied, the American economy will remain perilously fragile."

It will remain perilously fragile as long as the Democrats keep promising more and more benefits without any way to pay for it. George W. Bush was just as responsible for putting us in military conflicts without having the American people sacrifice something in order to fund it. Higher taxes are not the solution to the problem of a government and administrative state that has grown exponentially since the Marxist Progressives have tried to change our Constitutional republic into a welfare state

"It will also be vulnerable to the next demagogue wielding anger, r****m, and resentment as substitutes for real reform."

That's exactly what we have in the Biden Admin. A stooge for the American Marxists who want to destroy this country by fundamentally changing it. The left and their B*M and A****a allies are the demagogue r****ts.

"Closing our staggering wealth gap is crucial to the survival of both our economy and our democracy."

Yes, it is. However, he hasn't a clue as to what works and what doesn't. He's a theoretician. We may as well have Karl Marx advising us what to do. As Forrest Gump says, "Stupid is as stupid does."

https://www.youtube.com/watch?v=iNLOdRMgaDY&feature=emb_rel_end

==================
You are wrong again Milosia.
Robert Reich has a very politically biased opinion as democrat. He is 100% dev**ed democrat and had served in 3 democrat administrations of Gerald Ford, Jimmy Carter, as well as serving the Sec. of Labor from 1993 to 1997 under president Bill Clinton. Robert Reich's brain is 110% molded democrat.

His theory is pumping out too much cash into the market so as to stimulate economy, but where will the cash come from? From the rich according to him, that means increase tax rates for the rich to increase cash that will be pumped into the market. And who will pump the cash, no other than the handout democrats who Biden will distribute the $3.5 trillion. Reich's goal is to decrease gap between the rich and the poor .

During the administration of president Trump we have the best economy locally and worldwide. The gap between the rich and the poor was so slim. Income of those in the higher bracket has lowered the margin cause the company was so productive due to increased labor and production in addition to lower tax rates. Who benefitted on that. The employees. The employees salaries went up. There were 96.5% employment with companies producing so much production. Inflation was at its lowest. B****s, Hispanics, and all minorities and women have reached the highest income. Almost every one was employed Except those who are weak and sick. While few who did not have sk**ls were given training in private firms and after that they were hired full time. These were the prior convicts with low level crimes. and president Trump ordered them released. They became productive and felt self-worth and p***e of themselves. This is one of the virtues of having a job feeling good that elevated their self-esteem.

Biden is doing the opposite. He gives them tax payers money from Cradle to Grave. The best thing is " teach them how to fish , and you feed him for the rest of his life"

Giving work is better than giving money. Robert Reich. First , stir the growth of production to meet the demands. Those who demand, must be required/allowed to work and produce so as to balance between demands and supplies.

Another thing that Reich missed is the lowering of corporate tax rates. He has the opposite proposal for this by raising the taxes rates of the rich. If he does this, it will create inflation. Corporations or business industries when overhead costs rise, the solution is increase prices to offset the losses in the high taxes.

Another solution of companies when overhead cost expands, businesses reduce employment in order to continue the same earning potentials of the company, or increase prices of their labor, services, and or commodities for sale. What makes up production is material, labor, and overhead. All taxes fall into the overhead costs. The adverse effects of his propositions are inflation, higher unemployment, interest rates could go up too. When supplies of money is scarce at the bank, interest rates go up.
I hope president Biden does not listen to his handlers.

Biden's solution is pump more money. The $3.5 trillion will do the trick? No. What Biden must do is by not feeding those l***hes. Require them to work, instead of feeding them to stay home. When they produce that adds to supplies to meet demands of the increasing population.

Robert Reich's problems of economic perspectives:
The Great Depression of 2008 stemmed from the demands of the Liberal /Democratic Group to ease affordability by allowing home ownership for low income. That was how the Sub-prime lending came about. The loan interest rates of the Sub-prime lending is much higher than the prime rates.

At that time from 2006 until 2008, democrats demanded from banks and financial institutions to allow loans to low income, with bad credits by lowering requirements for lending practices. The normal rule to qualify mortgage loans are: Stable jobs. Must have only 30% debts or liabilities in relation to monthly income. Good credit ratings. These are prime rate barrowers.

However the high risks for sub-prime barrowers, those with bad credits, and low and not stable income. Their loan rates were significantly higher rates than the prime rate. After a year, tens of thousands were not able to pay their loans, with massive foreclosures happened. Several banks got bankrupt and closed.

The Real Reason the Economy Might Collapse
Robert Reich

Economic Policy | Wealth Ine******y
by Robert Reich | October 11, 2021 - 6:49am




Skyrocketing wealth ine******y isn’t just wrong. It’s also weakening our economy.

70 percent of the US economy depends on consumer spending. So American consumers need to spend enough money to buy most of the goods and services Americans are capable of producing.

This means that over the long term their incomes need to keep pace with their productivity.

But their incomes haven’t. Over the past 40 years, most people’s wages have basically stagnated , while worker productivity has soared.

Where did the economic gains go? Mostly to the top. The wealthy now own more of the economy than at any time since the 1920s.



Here’s the economic problem: The wealthy spend only a small percentage of their income and wealth. Their spending is not enough to fulfill the consumer demand that keeps the economy churning.

Lower-income people, on the other hand, spend almost everything they have – which is becoming very little. Most workers aren’t earning nearly enough to buy what the economy is capable of producing.

The result is a gap between potential output and potential consumption.

To fill the gap, the economy depends on people going deeper and deeper into debt so they can buy. Even in 2018, when the economy appeared strong, 40% of Americans had negative net incomes and were borrowing money to pay for basic household needs.

The Fed has had to keep short-term interest rates lower and lower to accommodate this buying. And the government has to spend more and more to fill the remaining gap.

None of this is sustainable. At some point, widening ine******y causes the economy to collapse.

We’ve seen this before. Years ago, Marriner Eccles, chairman of the Federal Reserve from 1934 to 1948, explained that the Great Depression occurred because the buying power of most Americans fell far short of what the economy was producing.

He blamed the increasing concentration of wealth at the top: “A giant suction pump had by 1929-1930 drawn into a few hands an increasing portion of currently produced wealth. As in a poker game where the chips were concentrated in fewer and fewer hands, the other fellows could stay in the game only by borrowing. When their credit ran out, the game stopped.”

While the wealthy of the 1920s didn’t know what to do with all their money, most Americans could maintain their standard of living only by going into debt. When that debt bubble burst, the economy tanked.

Fast forward 100 years and we see the same pattern. While the typical Americans’ wages have barely budged for decades, adjusted for inflation, most economic gains have gone to the top, just as Eccles’s so-called “giant suction pump” drew an increasing portion of the nation’s wealth into a few hands before the Great Depression.

The result has been an economy whose underlying structure is far more fragile than it may seem.

Remember the housing and financial bubbles that burst in 2008? We avoided another Great Depression then only because the government pumped enough money into the economy to maintain demand, and the Fed kept interest rates near zero. Then came the p******c.

The Fed has had to keep interest rates near zero. And the government has had to pump even more money into the economy. While these programs have been crucial to staving off a p******c-induced depression, they’re only temporary.

Over the long term, the real worry continues to be on the demand side. Widening ine******y means not enough demand.

America’s wealth gap is now more extreme than it’s been in over a century. Until this structural problem is remedied, the American economy will remain perilously fragile.

It will also be vulnerable to the next demagogue wielding anger, r****m, and resentment as substitutes for real reform.

Closing our staggering wealth gap is crucial to the survival of both our economy and our democracy.

https://www.youtube.com/watch?v=iNLOdRMgaDY&feature=emb_rel_end

The Real Reason the Economy Might Collapse
Robert Reich

Economic Policy | Wealth Ine******y
by Robert Reich | October 11, 2021 - 6:49am




Skyrocketing wealth ine******y isn’t just wrong. It’s also weakening our economy.

70 percent of the US economy depends on consumer spending. So American consumers need to spend enough money to buy most of the goods and services Americans are capable of producing.

This means that over the long term their incomes need to keep pace with their productivity.

But their incomes haven’t. Over the past 40 years, most people’s wages have basically stagnated , while worker productivity has soared.

Where did the economic gains go? Mostly to the top. The wealthy now own more of the economy than at any time since the 1920s.



Here’s the economic problem: The wealthy spend only a small percentage of their income and wealth. Their spending is not enough to fulfill the consumer demand that keeps the economy churning.

Lower-income people, on the other hand, spend almost everything they have – which is becoming very little. Most workers aren’t earning nearly enough to buy what the economy is capable of producing.

The result is a gap between potential output and potential consumption.

To fill the gap, the economy depends on people going deeper and deeper into debt so they can buy. Even in 2018, when the economy appeared strong, 40% of Americans had negative net incomes and were borrowing money to pay for basic household needs.

The Fed has had to keep short-term interest rates lower and lower to accommodate this buying. And the government has to spend more and more to fill the remaining gap.

None of this is sustainable. At some point, widening ine******y causes the economy to collapse.

We’ve seen this before. Years ago, Marriner Eccles, chairman of the Federal Reserve from 1934 to 1948, explained that the Great Depression occurred because the buying power of most Americans fell far short of what the economy was producing.

He blamed the increasing concentration of wealth at the top: “A giant suction pump had by 1929-1930 drawn into a few hands an increasing portion of currently produced wealth. As in a poker game where the chips were concentrated in fewer and fewer hands, the other fellows could stay in the game only by borrowing. When their credit ran out, the game stopped.”

While the wealthy of the 1920s didn’t know what to do with all their money, most Americans could maintain their standard of living only by going into debt. When that debt bubble burst, the economy tanked.

Fast forward 100 years and we see the same pattern. While the typical Americans’ wages have barely budged for decades, adjusted for inflation, most economic gains have gone to the top, just as Eccles’s so-called “giant suction pump” drew an increasing portion of the nation’s wealth into a few hands before the Great Depression.

The result has been an economy whose underlying structure is far more fragile than it may seem.

Remember the housing and financial bubbles that burst in 2008? We avoided another Great Depression then only because the government pumped enough money into the economy to maintain demand, and the Fed kept interest rates near zero. Then came the p******c.

The Fed has had to keep interest rates near zero. And the government has had to pump even more money into the economy. While these programs have been crucial to staving off a p******c-induced depression, they’re only temporary.

Over the long term, the real worry continues to be on the demand side. Widening ine******y means not enough demand.

America’s wealth gap is now more extreme than it’s been in over a century. Until this structural problem is remedied, the American economy will remain perilously fragile.

It will also be vulnerable to the next demagogue wielding anger, r****m, and resentment as substitutes for real reform.

Closing our staggering wealth gap is crucial to the survival of both our economy and our democracy.

https://www.youtube.com/watch?v=iNLOdRMgaDY&feature=emb_rel_end

===================
The deceptive economy of Joe Biden.
If Biden stays, this economy might even bring us to recession. Worst than the 2008. In 2008, we did not have this much inflation. Biden did a terrible job, and worst than president Carter. Here are the reasons why:

The p******c was only a little portion of the problem. It is the way how he handled the economic turmoil.
1. First, he released trillion s of $$ of stimulus to the people, allowed unemployment to stay long, while he supported their pension. These people preferred staying home comfortably at home than working.

2. Second, Biden continued releasing stimulus to people which allowed them to have massive consumptions with nobody producing. More of consumptions, with lack of production and supplies create inflation.

3. C***ds9 was made as instrument to prevent people from working, prevented from opening stores like restaurants, and special services. Lots of stores got bankrupted, due to lack of workers. When businesses get bankrupt, therefore fewer income taxes are paid to the IRS.

Now what are left on us? No production but continued demands for consumption in order to live. Many stores are empty for lack of supplies.

4. In addition, large suppliers like Walmart, and other stores are ransacked by thieves several times stealing valuables and essential items they find. Many shelves in stores, are now empty for lack of supplies plus being stolen by gangsters. Democrat mayors allow them to steal. E.g. Chicago, and San Francisco.

Joe Biden still blame the rich demanding that they have to pay more. Joe Biden must realize that without the rich, the government won't survive. Government spends money. It does not produce. The business companies provide and contribute to the economy. How? 1. They pay various kinds of taxes. Fact is they pay 40.1% of the IRS taxes.

2. They hire employees to work and make money. These employees become taxpayers as well both on the IRS and on the SS and Medicare. Instead of them being dependent on welfare, they become producers and taxpayers.

When they produce they replenish supplies on the market and fill up the shelves for buyers to consume.

So the rich and businesses make the economy going, not the government of Joe Biden. Biden expends the money that these businesses and working people pay to the Treasury. Without business, and workers how will the government survive?

Biden's solution? Audit and investigate peoples' bank accounts that make t***saction of over $600. All of the bank owners will be investigated. What a stupid idea is that. First of all that is a constitutional violations of the Amendment IV. No government has the right to investigate any people's account without outright justification to do so. It is the peoples' money and they can do what ever they want with the money they earn. If Biden asserts efforts to investigate that, it is an outright violation. Individual assets must be protected, and no government intrusion must be allowed.

Biden is waiting for the $3.5 trillion, hoping Congress will approve it. That money does not physically exist. Therefore our national debts will reach almost $ 36 trillion. That $3.5 trillion will become at least $6 trillion within 5 years. Currently it is $29.7 trillion.

What will happen on Biden's economy could be stagflation.
Stagflation is characterized by slow economic growth , and relatively high unemployment, or economic stagnation, which is at the same time accompanied by rising prices , or inflation.

Our economy will continue to slide. If people are continuously feed and supported by Biden, from Cradle to Grave, few people will find jobs, as they demand for more, and are comfortably provided. Though deceptively , Biden will claim low rate of unemployment. Dumb! Why? If fewer number of people unemployed are looking for jobs, divided by the total employed, this reduces that rate of unemployment. This is Biden's deception against the American people. Are we so dumb to to believe him?

America, please don't be fools. We have too much of corruptions and deceptions by the Democrat party.