Cross-posted from And The Horse You Rode In On
If you made over a billion dollars in 2006 (or if you hate numbers), skip to the last paragraph.
In 1895, in the run-up to the era of the Robber Barons, John D. Rockefeller declared $1.25 million of income on his tax return. That must have been enough to buy the Supreme Court, which the following year declared the income tax unconstitutional.
Back then, $1.25 million was 7,000 times the American average.
The next seven decades brought Teddy Roosevelt’s trust-busting, the rise of the labor movement, the Great Depression and the legislation it inspired, and the GI Bill following World War II. By the 1960s, the CEO of a typical Fortune 100 company was making 60 times the company’s average salary.
And now?
Now the Robber Barons are back.
By 2005, the CEO was making over 500 times the average salary. Last year, one hedge fund manager "earned" $1.7 billion, as much as 38,000 average Americans – who, incidentally, work just as hard as a hedge fund manager.
The top 25 hedgers made $14 billion. That’s enough to provide health care for all of the 8 million American children who don’t have it.
To compound the irony, since 1970 your tax rates have risen while those of the richest .01 percent have been cut in half.
I like rich people, honest. Especially Tiger Woods, Michael Jordan, and a couple of my golfing buddies. But if I were one of them – and knew anything at all about history – I would want to restore some basic fairness to the system very soon. Say, before the mobs show up with axes and torches at the front gate.
(NOTE: These figures courtesy of Princeton economist Paul Krugman’s Op-Ed column in the Apr. 19 Times and some of his past writings.)