Fixing the Economy: The "Company Store" Problem
Economic growth and productivity growth have stagnated since 1979. The distribution of income and wealth has become increasingly unequal: 10% of the population now receive 40% of current income and own 85% of financial assets and 70% of all wealth. Both households and government have accumulated ove...
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| Veröffentlicht in: | Challenge (White Plains) 1995-11, Vol.38 (6), p.55-58 |
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| creator | Korty, Doug |
| description | Economic growth and productivity growth have stagnated since 1979. The distribution of income and wealth has become increasingly unequal: 10% of the population now receive 40% of current income and own 85% of financial assets and 70% of all wealth. Both households and government have accumulated over $4 trillion in additional debt since 1979. An "investment gap" is the fundamental problem. In the last decade, corporations and high-income households loaned 1/4 of their investment income to government and other households to finance current consumption. As productive investment declined as a percentage of national income, speculative financial investment and total debt grew. A "company store" economy developed. Low wages and low taxes increased the share of income going to the wealthy. In turn, they "invested" in the increasing debt of the government and households, and the households and government borrowed because wages and taxes were inadequate to support their spending. |
| doi_str_mv | 10.1080/05775132.1995.11471868 |
| format | Magazinearticle |
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The distribution of income and wealth has become increasingly unequal: 10% of the population now receive 40% of current income and own 85% of financial assets and 70% of all wealth. Both households and government have accumulated over $4 trillion in additional debt since 1979. An "investment gap" is the fundamental problem. In the last decade, corporations and high-income households loaned 1/4 of their investment income to government and other households to finance current consumption. As productive investment declined as a percentage of national income, speculative financial investment and total debt grew. A "company store" economy developed. Low wages and low taxes increased the share of income going to the wealthy. In turn, they "invested" in the increasing debt of the government and households, and the households and government borrowed because wages and taxes were inadequate to support their spending.</abstract><cop>1952-1967</cop><pub>Routledge</pub><doi>10.1080/05775132.1995.11471868</doi><tpages>4</tpages></addata></record> |
| fulltext | fulltext |
| identifier | ISSN: 0577-5132 |
| ispartof | Challenge (White Plains), 1995-11, Vol.38 (6), p.55-58 |
| issn | 0577-5132 1558-1489 |
| language | eng |
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| source | PAIS Index; Periodicals Index Online; EBSCOhost Business Source Complete; Jstor Complete Legacy |
| subjects | Borrowing Capital gains Comment Company stores Consumption Debt Debt service Economic conditions Economic crisis Economic development Economic growth Economic reform Economic theory Economics Federal budget deficit Financial economics Financial institutions Financial investments High income Households Income inequality Income redistribution Income taxes Inflation Interest income Interest rates Investment Investment income Investments Personal debt Political power Politics Productivity Securities markets Stock exchanges Tax cuts Tax revenues Taxes U.S.A Wealth Wealth distribution |
| title | Fixing the Economy: The "Company Store" Problem |
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