Long Live the 1%

What did you give thanks for, Dear Reader?

Our thoughts turned to house, hearth, family, friends…

…and to rich people.

Yes, dear reader, we gave thanks for the wretched 1% of the population that has made such spectacular financial progress over the last 10 to 20 years. They are reviled. They are hated. They are criticized and blamed. Poor things! What have they done to deserve it?

The typical working stiff earns less real money today than he did 40 years ago.

And as for the poor…their lot in life is even worse. When we drove down to Woodbine, Virginia…on our way to a family gathering…we were surprised to find a corner where there were dozens of Latin Americans, all hoping for work. They sat under a tree. They stood on the sidewalk. There were groups of them. Even though it was raining, lightly, they kept their vigil…a few raised their hands as we drove by in a pick-up truck.

What a life! These poor fellows must turn out every day…hoping that someone will pick them up…put them to work…and pay them in cash. No health care insurance. No pension. No paid holidays. No nothing.

And then…what about the middle classes? Even high-earning two-income professional couples find it hard to make ends meet. Taxes take a big chunk of their income. And then transportation takes out another bite. Send a child or two to college…have an accident…get divorced…fall ill — it doesn’t take much of a set-back to tilt a middle-class family back below the poverty line.

And even when things go well, the middle classes have a rough time of it. They earn enough to live well…but they struggle to keep up with it. Two cars…two jobs…two children…sometimes two mortgages — and only 24 hours in a day.

The poor…the middle class…the proletariat in all its forms…is barely staying even. Can it invest money to build more wealth in the future? Can it power the economy to greater output with more demand for services and stuff? Can it take the time to discover new things…to explore new ideas…to follow up on its artistic, philosophic, religious or scientific hunches?

Nope. The lower and middle classes are spent out. Used up. Exhausted. Their houses have lost value. Their real incomes are falling. They’re out of luck.

But what about the 1%?

Thank God for the rich! They may be greedy…or not. They may be conniving, underhanded and manipulative…or not. They may be zombie insiders who have worked the system for their own benefit…or not.

But they’ve surely made it big. And now the nation turns its tired eyes to them. It is up to them now. They must invest in new factories and new businesses; who else has the money? They must spend…spend…spend to keep the wheels of commerce turning; who else can afford to? And they must also pay the taxes necessary to keep the zombies going. They already pay more than the bottom 95% of taxpayers combined. They already pay 40% of all the taxes collected by the feds. Each one of the 1% already carries 10 to 20 zombies on his back.

Yes, dear reader, yesterday, we did not curse the 1%. We gave thanks for them. Long may they live!

And we hope the b*****ds will remember this if we need to borrow money from them.

Regards,

Bill Bonner,
for The Daily Reckoning