Mmm! Mmm.
Mmm, sorry, didn't see you there. I just had lunch. No, not the rich...
yet,
but since you're here, let's talk about that!
Billionaires made $3.9 trillion worldwide
over the course of this pandemic, while the working
class has lost $3.7 trillion in wages.
Hold on...
No, that's not a coincidence that those numbers are near interchangeable, that's by design.
Hey guys, I'm Sana. This is the second
once-in-a-lifetime economic recession that I'm experiencing, and in this episode, we're talking
about wealth transfers and how every time there is a crisis, we all lose money so the rich can stay rich.
Oh and don't forget to leave us a like and subscribe for more eat the rich content...
Armie Hammer! This content is not for you! Damn!
♪♪
Yes, we've got vaccines, but
that doesn't mean the pandemic has come to an end. It's still far, far from over.
And both its immediate and long-term impact on this country, on our world, hasn't even been
fully grasped yet.
In almost a year, we've lost more Americans than
we did during WWII, 8 million have been pushed into
poverty, and 75 million have filed for unemployment.
That should be enough on its own to put the whole country on edge about the state of our economy,
but there's a certain group of people that really hasn't noticed.
This is about America's mega-rich, the 1%, who've
actually gained close to $1.1 trillion in wealth just over
the course of the pandemic.
Oh, and they're even multiplying — 56 new billionaires
minted since COVID said,
"Hey, how's it going. I'm here to ruin your life. What's up?"
Or as I like to call them: the second main course.
But wait, Sana! Those billionaires worked hard to
get that money! What do they have to do with other
people going into poverty?
Say hello to wealth transfers.
Wealth transfers happen when working- and
middle-class people lose out on income, property,
government assistance and other assets, typically
stemming from a financial crisis
or systemic exploitation.
And who does the money go to?
The unneedy of course.
It typically isn't one, big easily recognizeable siphoning of money, although there are
definitely instances where that's the case. Instead, it's done through a series of governmental policies
and practices.
In this country, it has a lot to do with how our
leadership has treated its economy
for the past 40 years.
-As we've expanded into a world competition,
some of that law has been overprotective. We have
to recognize now that we're not just dealing with
competition within our own borders but competition
with firms from outside the borders. And uh,
I don't believe that there's any threat or danger of
monopoly control here in our land at all,
and I don't think there will be.
Ah, we really can trace back so much contemporary American evil to this man, can't we?
That rhetoric you just heard has a name: neoliberalism. It's the governing ideology of our lives and its greatest
success is in its inability to be succinctly defined and known by those whose lives it destroys.
Neoliberalism sees the primary function of human
beings as consumption and sees market competition
as the driving force in human relations,
that we excel as human beings when we are driven by
competition for wealth and resources.
And that the greatest wealth comes from
financialization.
That's just a fancy term for people speculating on
how well the stock market or the financial industry will do, which the government enables through
monetary support and other incentives.
The primary goal of neoliberalism is to protect,
increase and entrench the role of the private
sector in an economy, which leads
to the false assumption that the health of the stock
market indicates the health of the economy and not
just how well the rich alone are doing.
And the two greatest icons of neoliberalism who
showed us how this was done best
were Ronald Reagan and Margaret Thatcher, girl boss!
So what do neoliberal policies and practices look like?
They look like tax cuts for the rich, deregulation of
the private sector, privatizing social and public
services, cutting funding to public services.
Neoliberalism looks like bailouts for the rich because
they exploited too much,
looking at you, 2008 financial meltdown.
And that's why we have such a bloated upper class. It's why we have such a massive gap between the wealthy
and the masses that only continues to widen.
And economic crises provide great fodder for
widening and deepening that gap.
See, when something like a pandemic or the collapse of a corrupt financial industry happens and
we find ourselves on the precipice of an economic crisis, the government moves into action.
But instead of creating and extending safety nets for people, it's the big corporations that are protected.
Our government tries to mitigate the worst possible outcome for the market so that people will keep
buying and big businesses can stay competitive, the idea being that private industry
is the bedrock of the economy.
And this is done through direct bailouts to businesses that rely on selling goods and services, and stimulus
programs which pump money into impacted markets.
But because of how our system is set up, these programs are easily exploited by big companies
in these industries, leaving little to nothing left for small businesses that then usually
succumb to the crisis.
Take, for example, the CARES Act of March 2020.
-We're so pleased today to be able to
have passed on the floor, practically unanimously,
this important bill, CARES, and we want to
demonstrate that we do care for the American people
in every way.
-If you own a small business, apply for the loan.
If you pay your employees, if you pay your rent
and you pay your utilities, that is not a loan.
That is a grant.
-The CARES Act was supposed to help small
businesses, health care providers and schools
impacted by the pandemic.
It was heralded as, quote "egalitarian" in its scope.
It wasn't about big business. It was for the little guys.
But egalitarian wealth distribution and America
just don't go together.
Sorry.
A Time Magazine investigation found that while the
language of the law made it clear that the money was
meant for businesses most in need, the programs
that were built to carry that out, um, didn't and
couldn't do that. Because they weren't
really designed to.
Only 5% of small businesses ended up getting relief from the act, whereas more than $243 million was
snapped up by big businesses and banks processing the loans made $10 billion in fees.
Please await my Twitter thread rant on bank fees.
It's gone too far.
These types of financial decisions are delegated to banks because they support that neoliberal
ideology. Finance is more important than manufacturing and giving them our taxpayer
dollars to do with whatever they want is fine, because what's good for the banks is good for everyone, right?
And you probably remember that this isn't the first time we've seen big businesses and the rich reap
the benefits of an economic crisis. Remember this classic oldie?
-We are in the most serious financial crisis
in generations.
In 2007, the world was hit with a financial crisis
following the bursting of the American housing bubble.
That was caused by predatory loan practices in
a financial industry that had veered away from its
simple outset goal — buying and selling houses —
to doing whatever it could to make a profit.
The stock market bounced back within a year thanks
to government intervention, while the depreciation
of housing and property values caused a major
recession for the rest of the country.
Part of the reason why this was such a "shock" to the system was because, for a long time, the shift in wealth
was concealed by the competing housing and stock markets.
I know that sounds boring, but it matters. Just wait.
According to a Harvard Business Review report,
between 1971 and 2007, income growth for the
bottom 50% of earning households had stagnated
while wealth from the housing market doubled.
And that wealth stagnated thanks in part to anti-unionization efforts,
the same unionization which would have given workers
collective bargaining power for fairer wages.
Fairer wages in an economy that encouraged
these workers to take on larger debt just to live day to day.
So when the market crashed, working-class Americans were left with incomes that hadn't
changed in 37 years, while the wealthy could continue to live comfortably with their own
exponential gains from a booming stock market, government bailouts and a non-stagnating income.
Then there's the role the Federal Reserve plays —
which is protecting the rich.
When the 2007 financial crisis hit, the Fed lowered
interest rates and poured money
into the economy through
quantitative easing.
In other words, it bought up a bunch of government
bonds and other long-term assets
to keep the market open.
This in turn gave a leg up to the rich because of how they're able to allocate their wealth.
Working- and middle-class people tend to retain most of their wealth in property assets, like houses and
brick-and-mortar businesses, whereas the rich have more of their wealth tied to stocks and investments.
That's why we saw a huge disparity in the recovery
after the 2008 housing crisis — because if you
lose your assets, your brick-and-mortar business,
your home — where is your wealth?
Where's your money then?
And of course, it's happening again.
In 2020, the Fed lowered interest rates to the lowest
they've ever been, which in turn allowed rich
beneficiaries to take out significantly lower-risk
loans and invest them for even greater profit.
And this is all to say, which should be obvious, that it's really bad for the country when these wealth transfers
keep happening. That we have policies in place that in "regular times" benefit the rich and in times of
crisis, save the rich and make them richer.
And it's not even good for the economy! Like, what?
-When we have record inequality in our country,
when the rich are getting richer and richer and richer
and still not creating jobs and meanwhile, because we've
taken those tax dollars out of the public sector that
helped them do well, we're laying off teachers,
we're laying off firefighters. We're literally killing
jobs to give them more money. I think that's a problem.
-In fact, this tax bill is the single biggest transfer of
wealth to the richest Americans in the history
of American government.
That last sound bite you heard was from four years ago, and we're already on our way to beating that record.
When only the wealthiest can easily recover from financial crises and continue to further take
advantage of the loss of wealth from the masses,
the economy takes longer to get back to a healthy and operational status quo.
The ones most affected by wealth transfers —
small businesses, immigrants, the working class, women,
Black and Indigenous people — are the most vulnerable
and most often the backbone of their industries.
And so, if they're deprived of their income, wealth and
security, it stands to reason that the economy can't
fully recover.
Unless you're rich.
But here's the biggest catch and I hate to leave you with this but I am Sad News Sana.
The transfer of wealth is always happening — it's only in a crisis, like the one we're in right now,
that it's amplified. The transfer of wealth isn't a single policy, it's a worldview and practice, what I earlier
referred to as neoliberalism.
Now you know what it is, you're welcome.
So, what does that look like in our day-to-day lives? What are some indicators that wealth is constantly
and slowly being siphoned to the upper classes?
Look out for a booming stock market and falling
interest rates. Look out for foreclosures, evictions,
small businesses closing and gentrification in
your local neighborhood.
And before the liberty bros start, these things aren't "just the way things are, Sana," or just par for the
course for a market, like this is somehow just naturally ocurring. No, all of this is by design
and it's for and by the richest in this world.
Anyway, that made me hungry all over again, and I hope you're hungry this time too,
because this meal is only getting bigger.
You know, we're all about eating the rich, but I gotta tell you, the indigestion and heartburn you get...
[mouthing "Wow"]
Thanks so much for watching, everyone. Don't forget to like, share and subscribe, and let us know in the
comments what your preferred condiment is.
Mine: Sriracha.
And tears.