I have babbled about how the rich actually have a negative incentive to bolster the economy; well at Jared Bernstein’s blog (I am a regular reader) he provides a graph that I think seals the case (from this post: “Data Notes Part 2: A Bit of Sandy Economics and Net Vs. Gross“):
I had not been aware of the term ‘net domestic product’ in any meaningful way before seeing his post (we hear about GDP (gross domestic product) all the time) and the wiki page (and Jared’s post) make it clear that GDP is largely meaningless without also showing stats on NDP. Looking at the NDP/GDP ratio on the graph above it is clear to me that our nation as a whole is growing less wealthy, yet it is clear from other reports that the wealthy (1%) are doing very well, thank you. So, if our NDP is shrinking (as a proportion of the GDP) and the wealthy are getting more wealthy still, what can that mean? To me it is inescapable: the poor and middle class (see here for my take on the ‘shrinking‘ (shrunken!) middle class) are getting poorer at a much higher rate than the rich are getting richer.
Not that I have any ideas on how to remedy the situation…
