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Originally Posted by Exhibitman
Can we leave the politics out of this discussion--just assume that we hate you and you hate us and will never agree on tax policy--and maybe we can discuss a serious issue raised in the OP as to the future of collecting rather than degenerating into a off-topic fight?
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The first premise of the article is not only that a very few people are very, very wealthy but also the vast majority of people come into the current crisis in a state of near poverty. “Most of you,” he says, “are aware that the bottom 90% own very little other than their labor (tradeable only in full employment) and modest amounts of home equity that are highly vulnerable to a collapse of the housing bubble.” The second premise is that the corona virus lockdown will result in lasting, widespread unemployment for millions in the service industries, and massive failures of small, start-up businesses, especially in the tech industry. The third premise is that the stock market will tumble, and the wealthy will feel poorer, and more vulnerable. The handful of people who buy luxury items will scale back on their purchases, and the value of “bubble-era” assets like vintage cars, vacation homes, etc. will fall at an accelerating pace. The fourth, implicit, premise is that the recent health of the economy, and the fabulous wealth of the very rich, was only a bubble, and thus was not natural or tenable.
Is all this valid? I think that the first premise overstates the relative poverty of the average American household. According to the Federal Reserve, the median net worth of such a household is $97,300. That may not sound like much, but it is more than Marx thought the average proletarian in the US would have by this stage of world history. The second premise? If the economy recovers gradually, then people gradually return to work, and the stock market doesn't collapse. Of course, if it crashes, then even the wealthy might start pinching pennies when it comes to yachts and Mantle cards. There are a lot of economists who think that the market has been too hopeful about a quick economic recovery, but not very many whom I’ve been reading are as gloomy as the author of this piece. So, I doubt it's accuracy. But time will tell.