A New Look at Wealth in the United States
New York, NY — The 2008 presidential campaign ended with a sharp moral debate about "spreading the wealth" in the United States. With national concern about a barrage of bad economic news--from the financial meltdown on Wall Street to the near-bankruptcy of the American auto-industry — which, coupled with bailouts and controversial tax plans proposed by the new Administration, have moved the issue of wealth distribution to the forefront of public debate.
In a provocative work of social criticism, Gar Alperovitz and Lew Daly provide powerful new ammunition in that debate, with their new book "Unjust Deserts: How the Rich are Taking our Common Inheritance and Why We Should Take it Back," (The New Press, November 2008). In it, Alperovitz and Daly explore the history and future of wealth distribution in America to show that as people have solved numerous problems that bewildered and plagued past generations, an immense "stock of knowledge" has been accumulated — a social inheritance, nurtured by governments, institutions, and culture, and created by many generations of people. However, the fruits of that knowledge — the wealth it generates — flows increasingly to the top.
One of the wealthiest men on the planet, Warren Buffett, with a current net worth of $60 billion, acknowledges that "society is responsible for a very significant percentage of what I've earned." Bill Gates, Sr. agrees when he writes, "Success is a product of having been born in this country, a place where education and research are subsidized, where there is an orderly market, where the private sector reaps enormous benefits from public investment. For someone to assert that he or she has grown wealthy in America without the benefit of substantial public investment is pure hubris."
Alperovitz and Daly challenge the commonly held viewpoint that we are entitled to own whatever wealth we create, stemming from philosopher John Locke. In his agrarian society and that of our Founding Fathers, wealth was mostly based on physical labor. In our knowledge-based society, the author's argue, Locke's argument doesn't work, since all knowledge that we receive from previous generations is a social contribution. The individual's role in advancing art, science and technology again is mostly based on our common heritage.
Drawing on cutting-edge research as well as their knowledge of philosophy and economics, Alperovitz and Daly prove that up to 90 percent — or even more — of private earnings are the result not of individual ingenuity, effort or investment, but of what they describe as the "unjust" appropriation of our collective inheritance. The cumulative knowledge that we all inherit, they argue, is key to individual achievement.
Alperovitz and Daly suggest reforms that could begin to change income distribution, including: raising income taxation for the top 1 to 2 percent of income earners; increasing the current cap on Social Security taxes; raising corporate taxes — such as on windfall gains in connection with oil industry profits; and increasing inheritance taxes on large estates. Proceeds from the new taxes could be used for the common good, such as instituting universal health care or propping up decaying infrastructure like bridges and tunnels.
"Unjust Deserts," says Barbara Ehrenreich, "reveals the untold story of wealth creation in our time," and, as Bill Moyers writes, it "opens an extraordinary new vista on the moral bankruptcy of our second Gilded Age."