The Rich Can’t Get Richer Forever, Can They?

[wisewomn]

The New Yorker: The Rich Can’t Get Richer Forever, Can They? (https://www.newyorker.com/magazine/2019/09/02/the-rich-cant-get-richer-forever-can-they)
Inequality comes in waves. The question is when this one will break.
By Liaquat Ahamed August 26, 2019

47654"In 1831, Alexis de Tocqueville, at the age of twenty-five, was sent by France’s Ministry of Justice to study the American penal system. He spent ten months in the United States, dutifully visiting prisons and meeting hundreds of people, including President Andrew Jackson and his predecessor, John Quincy Adams. On his return to France, he wrote a book about his observations, “Democracy in America (https://www.amazon.com/dp/0226805360/?tag=thneyo0f-20),” the first volume of which was published in 1835. Many of the observations have weathered well (he noted, for instance, how American individualism coexisted with conformism). Others have not. For example, Tocqueville, who was the youngest son of a count, was deeply impressed by how equal the economic conditions in the United States were.

"It was, at the time, an accurate assessment. The United States was the world’s most egalitarian society. Wages in the young nation were higher than in Europe, and land in the West was abundant and cheap. There were rich people, but they weren’t super-rich, like European aristocrats. According to “Unequal Gains: American Growth and Inequality Since 1700 (https://www.amazon.com/dp/0691170495/?tag=thneyo0f-20),” by the economic historians Peter H. Lindert and Jeffrey G. Williamson, the share of national income going to the richest one per cent of the population was more than twenty per cent in Britain but below ten per cent in America. The prevailing ideology of the country favored equality (though, to be sure, only for whites); Americans were proud that there was a relatively small gap between rich and poor. “Can any condition of society be more desirable than this?” Thomas Jefferson bragged to a friend.

"Today, the top one per cent in this country gets about twenty per cent of the income, similar to the distribution found across the Atlantic in Tocqueville’s day. How did the United States go from being the most egalitarian country in the West to being one of the most unequal? The course from there to here, it turns out, isn’t a straight line. During the past two centuries, inequality in America has been on something of a roller-coaster ride."

Continues here (https://www.newyorker.com/magazine/2019/09/02/the-rich-cant-get-richer-forever-can-they)

[Mayacaman]

Today, the top one per cent in this country gets about twenty per cent of the income, similar to the distribution found across the Atlantic in Tocqueville’s day. How did the United States go from being the most egalitarian country in the West to being one of the most unequal? The course from there to here, it turns out, isn’t a straight line. During the past two centuries, inequality in America has been on something of a roller-coaster ride."

To answer the Question "How did the United States go from being the most egalitarian country in the West to being one of the most unequal?" Simple: It was the combination of a Central Bank & the institution of a National Debt that is owed to a "bond-holding class" that has done the trick.

We have had three privately owned, joint-stock, Central Banks in our history. The first two, that were named "the Bank of the United States" ran for twenty years. Hamilton, as Secretary of the Treasury created the First Bank of the United States, in 1791. It had a twenty year charter that was not renewed in 1811.

Madison, who had co-authored the Federalist Papers with Hamilton, broke with him at that point in 1791, saying that there was no Constitutional justification for the Bank. Madison was President in 1811, and had a hand in the decision not to renew the Charter of the "First Bank of the United States".

The war of 1812 is reputed by some to have been caused by the British, in order to put pressure on America to renew the Charter of the Bank. This is debatable. However, in 1816, the Second Bank of the United States was instituted, also with a twenty-year Charter. That was the Bank that Andrew Jackson made such a big deal over. It ended in 1836. Thus, it was in operation when Alexandre de Tocqueville came to America and began writing the field notes for his famous book.

Both of these Central Banks were, in essence, based on the model of the Bank of England. The difference was in the multiplier {the reserve ratio.) With the Bank of England it was eight; with both runs of the United States Bank, it was only three. Thus, during the time of de Tocqueville, the privileged in America - the owners of bank-stock - were not raking in as much loot as they have subsequently, under the Federal Reserve Bank, which has been in operation now for one hundred and five years, ever since 1914.

The Federal Reserve Bank is the main cash cow of the plutocracy in Amerika. They "own" the national debt, and collect quarterly dividends {six per cent, per annum} off of the Interest on that phenomenal sum, which the Federal Reserve System has set on the "up & up..."

[luke32]

Well, Mayacam, to 'Clintonize' your statement, "The Federal Reserve Bank is the main cash cow of the plutocracy in Amerika.", it all depends on your definition. U.S. citizens own less than one-third of the U.S. debt.

Marketwatch: Here’s who owns a record $21.21 trillion of U.S. debt (https://www.marketwatch.com/story/heres-who-owns-a-record-2121-trillion-of-us-debt-2018-08-21)