Author Sanghoee: Income Inequality Will Crash US Economy 'Like a House of Cards'

Friday, 20 Sep 2013 12:32 PM

By Michael Kling

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In one of the sternest warnings yet about America's growing income inequality, a former banker is predicting the American economy will come crashing down like a house of cards if we don't deal with the issue.

Sanjay Sanghoee, an author and political and business commentator, in an article for The Huffington Post, cites numerous statistics to support his view.

Inequality is greater than it's been since the 1920s. Average income in the U.S. is $51,000, but $717,000 for the top 1 percent.

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Two-thirds of minimum-wage earners live below the poverty line. The top 1 percent owns 42 percent of America's wealth and has raked in 95 percent of all income gains since 2008.

Large corporations and wealthy individuals continue to evade taxes through offshore tax havens and other loopholes, costing the government $150 billion a year.

The wealthiest are getting wealthier while the poor become poorer, in both relative and absolute terms.

"The culture of gaming the system for personal gain, which lies behind this, is bound to be destructive since for someone to win, someone must lose," he says.

Corporations and wealthy individuals are increasingly using political campaign contributions to control the government. Their PAC contributions exploded during the 2012 elections, "virtually hijacking both Washington and the elections to move us towards a government of the rich, by the rich, and for the rich."

Inequality will continue to increase if we don't reform Wall Street, control corporate fraud, increase the minimum wage, close tax loopholes for the wealthy, and limit political contributions.

Increasing inequality will lead to growing social unrest, warns former Labor Secretary Robert Reich, who produced a new film "Inequality for All."

"The anger is coming directly out of the frustrations of so many people that they're working harder than ever, and they're still living essentially paycheck to paycheck," Reich told The Los Angeles Times.

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Related Stories:

Robert Reich: Wall Street Banks 'Should Be Split Up and Their Size Capped'

Krugman: Growing Inequality Is Becoming Extremely Destructive





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