Guest Post: Still Not Spreading the Wealth Around

Tyler Durden's picture

Via John Aziz Of Azizonomics blog,

Obama has always claimed to want to spread the wealth around. Yet, as I stressed this June (and in my first ever blog post way back in July 2011!) that’s the exact opposite of what he has achieved.

And it’s getting worse, not better.

Wages-as-a-proportion-of-GDP just hit another all-time low:


And corporate-profits-as-a-proportion-of-GDP just hit another all-time high:


Obama might throw a lot of rhetoric about fighting for the middle class.

But the reality has been the opposite. America today is all about the enrichment of big banks, financial corporations and the military-industrial complex, while the working class has rotted.

The truth of Obama’s policies (and successive administrations prior to Obama) is more concentrated wealth within the financial elites and Wall Street. Banks get bailed out. Campaign donors get stimulus money. And the middle class and future generations pay for it in taxation and the Cantillon Effect.

The Obama reinflation is a rotten bubble built on rotten foundations. Trying to reinflate the economy from a starting debt ratio of over 350% of GDP through crony corporatism and helicopter drops to the rich is an absurd notion that is doomed to abject failure.

And the growing gap between the rich and the poor is steadily beginning to resemble neofeudalism.

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WhyDoesItHurtWhen iPee's picture

Only thing getting spread is ass cheeks.

tsx500's picture

  <------  FORWARD !

   <------ BACKWARDS !


Dr. Richard Head's picture

Will there be a rinse in this cycle?

LetThemEatRand's picture


"Forward" or "Backwards."

Ironically, his campaign slogan "forward" is most accurate.  He is moving forward with the same policies that have led us to this mess over the last 40 years (or really much longer via the federal reserve system).  If you substituted "forward" with "more of the same," it would be dead on.


NachoLiebor's picture

Forward (that debt to future generations)

andrewp111's picture

Forward lemmings. Over the Cliff!

Chuck Walla's picture


Apparatchiks of the World, Fight for the glory of the rich!

LawsofPhysics's picture

Define "wealth".  I don't necessarily consider holding paper promises being wealthy.  Especially since fraud is the status quo.

walküre's picture

Someone obviously knee deep in Benny's fraud bux has junked you.

Guess what? They think they get to keep all that "wealth" at face value and eat their pie too!

Over my dead body.

Winston Churchill's picture

Their pockest will be stuffed with their wealth to aid the drop.

e-recep's picture

as long as you can buy physical PMs with those paper promises methinks they are fucking valuable.

Insideher Trading's picture

But the reality has been the opposite. America today is all about the enrichment of big banks, financial corporations and the military-industrial complex, while the working class has rotted.

Has colloquially been defined in modern parlance as "crony capitalism" which is nothing other than a euphemism for fascism, which is what it should be justly refereed to as.

Grinder74's picture

"Only thing getting spread is ass cheeks..."

Happy to spread hers!

Joe moneybags's picture

It's not the job of the POTUS to spread wealth around.  So, author Aziz should be giving Obama credit for not having done so.

LetThemEatRand's picture

I think you missed the point of the article (or at least the point that I took away) -- he is redistributing wealth, just not the group for whom he claims to be the champion.  He is redistributing wealth from the middle masses to the wealthy few.   What I find so frustrating debating with various characters here at ZH, is that many of them want to end the role of government in distributing wealth AND let the winners of the last 100 years or so who made their wealth through crony capitalism, keep theirs because otherwise we would be using "violence" to "redistribute wealth."  

cossack55's picture

Agreed. Violence should only be used to "redistribute justice".

GeorgeHayduke's picture

Oh, the owners have used violence for decades to redistribute wealth upwards. This violence has been institutionalized and their propaganda mouthpieces, which morons call the "liberal" media, reinforce this violence as normal and the lesser minds buy it. These are the same dim bulbs who have been calling Obama a Socialist, Communist, Marxist, etc... The owners sit back and laugh.

Below is the hierarchy of violence as defined by Derrick Jensen. After observing the culture of the USA for 51 years I would say it's a dead on assessment.

Hierarchy of Violence: Civilization is based on a clearly defined and widely accepted yet often unarticulated hierarchy. Violence done by those higher on the hierarchy to those lower is nearly always invisible, that is, unnoticed. When it is noticed, it is fully rationalized. Violence done by those lower on the hierarchy to those higher is unthinkable, and when it does occur is regarded with shock, horror, and the fetishization of the victims."

escargot's picture

God I'm so sick of hearing dickweeds and dingbats talking about the "liberal media" and the "socialist" Obama, too.  Thanks for making me feel less isolated.

I read that Derrick Jensen book a few months back.  It's a good read, although that guy really needs to lighten up a bit.

NoDebt's picture

He hasn't gotten around to it YET.  He's trying the best he can, ya know.  If you would all just shut up, sit down and let him raise taxes on the "rich" this trend will surely be reversed and everything will be all 1954 again.

I mean the man single-handedly fixed health care in his very first term and all of a sudden you don't trust him with a simple task like income disparity?  You don't know how hard it is to get stuff done in D.C.  No man could do it all in 4 short years.

The next 4 years he will tackle income disparity.  The 4 after that will be global warming.  The 4 after that will be comprehenive immigration reform.  And by his 5th term he should have things pretty much straightened out.

Beam Me Up Scotty's picture

If the Republicans were smart, they would step aside and let Obama have whatever he wanted. They should just vote present. Then there is no question who threw the shit into the fan.

knukles's picture

Hah ha ha ha ha

That is brilliant
The whole bloody lot of 'em vote "Present" and then walk out, en masse.

Yesseriee Bob's Boner...
Officially usher in the end of it's "Bush's fault" and a bless the formal initiation of it's "Obama's fault"

Ta da da da dah da dah
Ta dah da dah da dah

fattail's picture

Let it burn.  Let the parasites and moochers consume their host.  Then we can burn the carcass and start over clean and healthy without the infection of the past 50 years.

Dr. Engali's picture

That's funny you used republicans and smart in the same sentence . I do agree with your idea though. I've felt the same way. Just give him everything he wants and watch this fucker burn to the ground.

Withdrawn Sanction's picture

If the Republicans were smart... lost me on that one.

If a frog had wings, it wouldn't bump its butt, or if your Aunt had balls, she'd be your uncle....and so on

Ballin D's picture

Especially since Obama has been so successful at convincing the stupid that the Republicans are keeping him from fixing things.

The only problem would be if this happens and the gov't ends up being able to print its way through the next couple decades ala Japan.  We'd be waiting a long time for our laugh and it would get blamed on the person holding the ball when shit blows up anyway.

GeorgeHayduke's picture

"If the Republicans were smart...."

...they wouldn't be Republicans. (Unless they were already quite wealthy.)

tsuki's picture

You're right.  Santorum said so.

MyBrothersKeeper's picture

I have been saying this as well.  Get them to drop the debt limit stipulation and tell Obama he has the votes...then vote present.

MyBrothersKeeper's picture

In the bigger picture the thing that drives up wages are employment as a percent of population and competition.  The biggest inhibitors to those things are currently the govt.  Just like with bank bailout the govt has, in effect, fostered monopolies.  the bailouts and subsequent regulations drove away small/regional banks.  The crony capitalism that favors big business vs small business has created a more monopolistic economy.  New regulation pertaining to EPA, credit etc have all pinned down innovation/entrepenuerism.  The propoganda has led people to believe that all business owners are rich.  They want you to believe the stock market is a reflection of the overall economy.  If this were true then why is the FTSE index in England up 11% as the country has re-entered recession?  In America there are only about 5,000 public traded companies.  There are over 22,000 private companies that start with the letter "A" alone.  It's these private companies that create 2/3 of all jobs yet they are being strangled by policies and regulation. Big companies not only use economies of scale, but are then given tax and regulatory advantages that small companies don't have.  They use this leverage and the ability to layff or downsize employees to keep profit margins high.  Small companies have no such luxury.  Innovation is the mother of job creation.  As long as innovation is supressed you won't see any drastic change in unemployment...which we all know is really between 11-15% if you have the ability to look behind the real numbers.

As I've said for a long time, either Obama and those that surround him are the most economic incompetent people to ever hold public office or they are intentionally destroying the economy.

spooz's picture

They're just taking care of the corporate cronies who pay for the priviledge.  If corporations like McDonalds and Walmart were forced to pay a living wage to their employees, it would make small restaurants and businesses more competitive.  I think a two tiered system of regulation is needed.  Small businesses should be exempt from regulation for the most part, while big corporate interests, because of their outsized impact on our economy, should be more heavily regulated.  And regulatory expenses should be reimbursed from corporate profits, not taxes.

MyBrothersKeeper's picture

Using companies that require a mostly minimum wage workforce is not a good example imo.  Nobody should aspire to a minimum wage job.  You should be saying "I don't want to be stuck doing this my whole life, i'm going to improve my skills and move on"....unless you are a retiree that just wants to supplement income. Face it, most 12 year olds would have no problem doing those jobs. Raising the minimum wage will only hurt competition and small/med size businesses...even if only larger companies had to pay it. Having lifetime cashiers at McDonalds would hurt the labor market as it would inhibit both teenagers/college students and also retirees. So the last thing you want is employee complacency at that level.  If you are trying to provide for your family by working a minimum wage job you have made some serious mistakes and it's not mcDonalds job to make up for your's up to you to gain some additional skills and maximize your God given talents.....or stay there and have a plan to move up in the org.

Withdrawn Sanction's picture

Big companies not only use economies of scale, but are then given tax and regulatory advantages that small companies don't have. They use this leverage and the ability to layff or downsize employees to keep profit margins high.

Quite true.  And yet despite these advantages, the big boyz still die off.  Of the 12 members of the Dow Jones Industrial average in 1912, only GE and US Steel remain (an 80+% mortality rate).   Or maybe it's because of, not despite the "advantages."  Advantages that lead to lethargy, bureaucratic sclerosis, and the diminishment if not outright disparagement of innovation.

MyBrothersKeeper's picture

Your last sentence is a great statement and 100% true.  Those corporations that rely on government favor to suppress competition vs innovation and free market dynamics tend to get less innovative and more lethargic.  They, in fact, become more like government entities..buerocratic to the core.  Unfortunately, the crony capitalism is so rampant now and the policies so anti-innovation that the problem has become exacerbated due to the monopolistic nature of the economy. Furthermore many are more entrenched as part of the political/corporate oligarchy that they can still thrive based on government contracts and favors...all the while using taxpayer money to help each other.  Many corporations outside of the defense sector are now doing what the defense sector has been doing for decades....getting rich by ripping off the taxpayers. The defense contractors have the advantage due to the procurement cluserfuck/security clearence hurdles.  Corp's like GE tie themselves to specific legislation (ie green energy). The corporations aren't evil per se.  They have just bamboozled politicians to play by the rules that give favor to them and in return the corps give money to keep them in office.  Hard to sue corporations for violation of anti-trust law (via Rockafella's Standard Oil) when the government has created the monopoly.

How do small/medium size companies compete with that?  Historically, they become more niche oriented and use flexibility to their advantage.  But now with the policy raodbloacks (taxes, regulation/lack of access to credit/Obamacare) they can't even get off the ground or grow in a way that they have historically been able to.  They have to spend so much time/money dealing with these things that it takes away their ability to be flexible in meeting what the market demands. Thay can't hire a team of lawyers/pr people etc to make sure they are compliant...they have to figure it out themselves and it's killing them.

People need to ask themslves 2 questions when government does anything:  1) Does this create competition in the private sector; and 2) Does it increase the level of transparency.  If it doesn't the govt should not be doing it and they shouldn't be "taking over" anything.  The most underutilzed resource in the world is human capital.....which requires leadership.  Imagine if college football only allowed coaches to coach 2 hours per week.  This would eliminate the advantage of leadership/innovation of guys like Brain Kelly at Notre Dame, Urban Meyer, or Chris Peterson at Boise State or a Brad Stevens at Butler.  You simply cannot unleash human capital while suppressing innovation and leadership.

prains's picture

regulatory capture; it's when your balls are being tickled but you don't know by whom

woggie's picture

the beast is on the gobble
and all that matters is we're all headed for it's belly

walküre's picture

are you Barry or the Budda? I'm confused

A Middle Child of History's picture

Hickory dickory dock
Out slithered Woggie from under his rock
To post anew on an article or two
The same old tired and worn out schlock.

Wakanda's picture

The Second American Revolution, unfolding now at kitchen tables, taverns, and fishing holes near you.

alien-IQ's picture

More evidence (as if we really need it)

Study: American Households Hit 43-Year Low In Net Worth

By CBS December 02, 2012 - WASHINGTON (CBS DC) – The median net worth of American households has dropped to a 43-year low as the lower and middle classes appear poorer and less stable than they have been since 1969.

According to a recent study by New York University economics professor Edward N. Wolff, median net worth is at the decades-low figure of $57,000 (in 2010 dollars). And as the numbers in his study reflect, the situation only appears worse when all the statistics are taken as a whole.

surf0766's picture

And now for the wealth tax so everyone can pay their fair share.

surf0766's picture

There is a good joke.  GDP   !

nmewn's picture

"...through crony corporatism..."

John, much better descriptor than the term "crony capitalist" likey ;-)

Hedgetard55's picture

The only crony anything Barry Choomboi gives a fuck about is his crony Reggie Love's head, as in Barry ain't gettin' any lately.

Bob's picture

Nice post on your site, John.  The possibility of Creative Destruction is behind us, I gotta think.  I share your wishes for what could have happened in 2008, but that was a long time ago. 

Letting it happen "organically" now would be just plain deadly for the common man, woman and child. 

Only a RICO campaign that hammered virtually everybody now in charge, public and private, could set this shit right. 

Ain't gonna happen. 

Oh yeah, the real progressives loathe Obama with a passion that is unique in their modern experience. 

If only our libertarian brethren would meet us halfway on civil liberties and war, we could find a way out of this. 

If pigs could only fly. 



Abrick's picture

Neo-whatever is what everyone wanted. Anything but actually having to work for a living.

IamtheREALmario's picture

I have noticed that corporations, living by the "growth paradigm" are doing two things; first raising prices to make up for the lack of volume growth .. they are creating inglation to make rowth targets and they can because they lakc competition a laws protect them ... and they grow profits through increases in labor arbitrage.

... all to pay overpaid and crimininally complicit execs (who the elitists have enlisted through salary bribery) and to inflate stock prices, Ponzi style.

Just FYI: the growth paradigm has NEVER been a certainty and assuming it is just leads to theft, draud and sociopathic activity.