The world of taxes and regulation changed in 1980. Result? The rich got much richer at America's expense.

Everything you need to know about increasing the Minimum Wage

Zuzu's petals are long gone...

It’s a Wonderful Life, for Potter.

Lionel Barrymore as the evil banker "Mr. Potter"

by Nick Paleologos, December 20, 2013

If you’re channel surfing this holiday season, it will be hard to miss Frank Capra’s 1946 Christmas classic, “It’s A Wonderful Life.” It will be even harder to swallow the moral of the story--given what NPR reported this week. Of the $1 trillion the Federal Reserve has pumped into the financial system this past year, according to former Fed Chair Alan Blinder, “Essentially none of it got lent out…it all got bottled up in the banks.”

Is there anybody out there who still believes that banks keep our money safe and make loans to help us buy stuff? Of course not, and here’s why. Imagine falling asleep in Bedford Falls and waking up in Pottersville. The Bailey Savings and Loan is long gone. So is good old George Bailey. You’re drowning. But George isn’t there to save you because Clarence isn’t there to save him. You see, in this nightmare there is no Clarence. 

And its not just the banks. The stock market used to exist to help companies find capital, until Potter took it over. In the old days, a guy woke up and decided America needed widgets, and he was just the one to make them. He went down to the market and convinced some folks to give him money for his widget business. In exchange, they got shares of stock in his new widget company. Widget Guy used the money to buy equipment and hire people. If he made a profit, so did his investors. If he didn’t, they didn’t. Here’s the best part: whether or not Widget Guy and his investors made money, lots of people got hired and paid in the process. And lots of real stuff got bought and sold.

Then Potter took over the market and screwed everything up. He convinced those same investors that they were chumps for buying shares in Widget Guy’s company. After all, it takes time to build a successful business. Who wants to wait that long to make money? Potter had a better idea. If investors liked widgets so much, they should give their money to Potter instead. He’d find other investors and they could all bet with each other on the price of widgets. Potter would be the bookie. They could bet on Widget Guy’s stock price without ever giving him any money at all. When they got bored with betting on widgets, Potter had a million other things they could bet on: the price of cars in China; the temperature in Sri Lanka; the rainfall in Iowa; or for that matter--anything else that moves. Every day Potter came up with more exotic bets to suck all their investment capital out of the real economy.

How many bets did Potter book while nobody was looking? Let’s put it this way, the federal budget deficit this year is lower--by half--than it was four years ago. But it’s still humongous at three quarters of a trillion dollars. If you add up all the federal budget deficits over the last 200 years you get the national debt—which is about $16 trillion. At this very moment, Potter is holding bets (he calls them derivatives) worth approximately $600 trillion. That’s 37 times the national debt—all tied up in betting slips. And whether Potter’s clients win or lose, Potter always wins because he gets a fee on every bet. Meanwhile Widget Guy never sees a penny. By the way, the last time Potter guessed wrong, the rest of us had to cover his losses.

Why? Because Potter also took over the US congress--which changed all the laws in his favor. Think about it. There was a time when congress at least pretended to support the notion that everybody should pay their fair share of taxes. That’s all changed.

Today, the official policy of the United States is: tax wealth at a lower rate than work. Potter makes $10 million a year and pays less than half the tax rate of Widget Guy, who earns $100 thousand a year. And that’s just the tip of a very dirty iceberg. Potter doesn’t pay a penny more in Social Security taxes than Widget Guy either--despite pocketing a salary that’s 100 times higher.

On Capitol Hill, Potter decides what’s fair.

On Wall Street, Potter decides what’s right.

Unfortunately, Widget Guy lives on Main Street.

And in Pottersville, Main Street doesn’t have a chance.

One year after the Sandy Hook slaughter of 20 kids, no background checks--and the killing continues.

Laid off workers are unemployed longer now than at any time since WWII. This is no time to cut benefits.

Conservative National Journal calls GOP "Clueless,Heartless & Gutless." Here's why:

Just think what even the slightest bit of GOP cooperation might have produced

Senator Dick Durbin: Increasing the minimum wage does NOT kill jobs

“When you go back to the beginning of the minimum wage law under Franklin Roosevelt, 80 years ago, exactly the same arguments were made against it. Every time we’ve tried to raise the standard of living for hard working people at the low end of the income scale, they’ve said “Oh my goodness you’re just going kill off jobs.”

The facts and statistics simply do not back that up.

It isn’t just the minimum wage. It’s making sure that working Americans have access to affordable health insurance. It’s the earned income tax credit--that was created under President Ronald Reagan. We’ve got to make sure they keep up with the needs of working Americans.

These used to be consensus, bi-partisan issues. We’ve got to get back to that day, or the working folks across America are going to fall further and further behind.”

---Sen. Richard Durbin on ABC News "This Week"

Obama meets Madiba.

In 2005, on a visit to Washington DC, 87 year old Nelson Mandela invited a young freshman Senator over to his hotel. An aid to the Senator, David Katz, snapped this photo--the only picture ever taken of the two men together.

In 2013, 6 members of the Walton family have more wealth than the bottom 40% of all Americans.

TODAY, THE TOP 10% OF AMERICAN WAGE EARNERS GRAB HALF OF ALL US INCOME--WITH A HUGE CHUNK OF THAT GOING TO THE TOP 1%.

In 1970, US CEO'S EARNED 20 TIMES MORE THAN THE AVERAGE WORKER. TODAY, THEY EARN 300 TIMES MORE THAN THE AVERAGE WORKER.

Educator in Chief: The biggest threat to America is a growing sense that the system is rigged against hard workers.

2 charts from former Labor Secretary Robert Reich show what went wrong.

Income inequality rose sharply before the Great Depression. Thankfully, Franklin Roosevelt ushered in tax and regulatory fairness. In the post-Roosevelt years, things got much better. Enter Ronald Reagan in 1980. He slashed taxes, killed consumer protections and the wage gap has widened ever since. This chart shows the dramatic trajectory of income inequality since 1920:

WAGE GAP SINCE 1920

From the end of WWII until 1980, as productivity increased, so did wages (of both the top 1% and the average worker)--at about the same rate. Then, beginning in 1980, productivity kept going up. So did the income of the top 1%. But the typical worker's income stopped rising. Pretty much all of the wealth created went to the top 1%. This chart clearly illustrates the grotesque inequity caused by massive tax cuts and deregulation. 

No-Can-Do Congress: Worst Ever. Boehner's disgraceful GOP layabouts

                    "Do Nothing Congress"     Gingrich       Boehner