Wages Are Falling. Wealth Is Surging.

For decades now the Republican Party has strived to recreate the Gilded Age while slashing programs that help support the working and middle classes. Despicable House Speaker Mike Johnson has signaled that next year the GOP seeks to make cuts to Social Security and Medicare claiming budget constraints as requiring cuts while ignoring the trillions of dollars of lost tax revenues as a result of huge GOP tax cuts for the ultra-wealthy (think the Felon's "big beautiful bill").  In some ways the GOP effort has exceeded the party's wildest dreams as wealth disparities now exceed those that existed during the actual Gilded Age, albeit with less efforts by the super rich to fund charities, libraries and other things that added to the larger public good.  The Felon promised in the 2024 campaign that he would lower prices on "day one". That, of course has not happened and instead consumer prices have surged and increased energy costs thanks in part to the Felon's war of choice have wiped out incomes for many, many Americans.  Now, returning from France where the husband and I saw royal palaces and incredible chateaux, it's as if the GOP and the billionaire set are as blind as the French aristocracy was to the plight of the many on the eve of the French Revolution.   A  column in the New York Times looks at the struggles of most Americans while the few enjoy obscene levels of wealth:

Two events from the past week help crystallize this strange, contradictory moment for the U.S. economy.

On Wednesday, the Bureau of Labor Statistics reported that the surge in energy prices had wiped out a year and a half of wage gains for the average American worker. On Friday, the public-markets debut of SpaceX made Elon Musk the world’s first trillionaire.

That stark juxtaposition helps explain why many Americans, in survey after survey, say they no longer believe the U.S. economy is working for them. A few people are getting fabulously, unimaginably wealthy at the same time that entire generations of families worry they will never be able to afford to buy a house, raise children or enjoy a comfortable retirement.

Inequality is hardly a new feature in America. But the explosion of wealth at the very top is without precedent in U.S. history. At the height of the Gilded Age at the end of the 19th century, the richest handful of Americans had a net worth equivalent to about 3 percent of the country’s annual economic output, according to data compiled by the French economists Gabriel Zucman and Emmanuel Saez. Today, the fortunes of the same 0.00001 percent — about 20 individuals — make up roughly four times as large a share, equivalent to 12 percent of annual output.

Other economists, using different methodologies, come up with somewhat different numbers. But hardly anyone disputes the basic fact that the wealthiest few have made extraordinary gains in recent years.

The picture for the other 99 percent of Americans is more nuanced. More than half of U.S. households own stocks, either directly or through retirement accounts, meaning they have benefited at least somewhat from the record-setting run-up in share prices. Wealth has risen more slowly for middle-class families than for the rich over the past decade, Federal Reserve data shows, but it has still risen.

For most Americans, however, “wealth” is a somewhat abstract concept, tied up in the house where they live and the retirement accounts they hope to leave untouched for as long as possible. What matters more, day to day, is their income. And the share of national income going to workers has been trending down for decades. It hit a record low in the first quarter of the year, according to data from the Commerce Department.

Now, rising costs are again taking a bite out of workers’ paychecks. The recent jump in energy prices — a result of the war with Iran — pushed the annual inflation rate to a three-year high in May. Hourly wages, adjusted for inflation, have fallen for three months in a row, erasing all the gains made during President Trump’s first year in office. Measures of consumer sentiment have plummeted as gas prices have risen.

But relief at the pump is not likely to end Americans’ anxiety after years of one economic shock after another. First, the Covid-19 pandemic shut down large parts of the economy and put tens of millions of people out of work, at least temporarily. Then inflation soared to the highest level in four decades. Since then, Americans have endured high interest rates, tariffs and repeated recession scares. . . . . ‘How am I supposed to plan for the future?’” said Elizabeth Wilkins, president of the Roosevelt Institute, a left-leaning think tank.

Ms. Stantcheva, the Harvard economist, has found that bouts of high inflation take a long-term toll on consumers’ economic attitudes. That is not only because of the strain on their budgets but also because it seems unfair — the wealthy are able to absorb higher prices relatively easily, while lower-income households struggle. . . . “It goes hand in hand with a big sense of inequity and injustice,” she said.

Now Americans face a new threat in the form of artificial intelligence, which tech industry leaders warn could eliminate whole categories of white-collar work. Many economists are skeptical of those predictions, but polls show that many workers are worried about what the technology will mean for their careers. Voters across the country have also rebelled against plans to build A.I. data centers in their communities, citing their impact on electricity bills, water supplies and air quality.

Given those concerns, it is hardly surprising that the public is uncomfortable with the surge in wealth that has accompanied the A.I. boom. . . . “Many of the tech moguls who are the current superrich have not helped themselves in the conversation by saying, ‘My innovation is going to obliterate your life,’” said Glenn Hubbard, an economist at Columbia Business School who served as a top adviser to President George W. Bush. “It’s not too crazy to imagine a backlash.”

Mr. Hubbard said he did not necessarily see a problem with the existence of billionaires or even trillionaires, as long as people were getting rich through entrepreneurship and innovation rather than through corruption or cronyism. But he said policymakers should take the public attitudes seriously. Congress should consider ways to tax billionaires more effectively, he said, and to ensure that the wealthy don’t exert undue influence on the political system.

Many progressive economists, however, argue that enormous fortunes like Mr. Musk’s inherently distort both the economic and the political systems, giving the superrich too many ways to avoid regulation, taxation and oversight. . . . . No wonder so many Americans feel that the economy is rigged against them, said Heather Boushey, who served as an adviser in the Biden administration and has written a book about the economic impact of inequality.

“Clearly our economy is designed to create a handful of billionaires and a trillionaire,” Ms Boushey said. “It is no longer about creating opportunity and stability for the majority.”