Economic Populism appears to be back in vogue. Given the fall of Lehman Brothers and the Wall Street machine, the economic banter clearly seems to be “the people” versus “the elites.
Economic populism involves an economic philosophy urging social and political system changes. In the current political and economic climate, the public concern over the inequity of wealth appears to be at a peak. There is a growing call by Senator Barack Obama and democrats to raise taxes on the wealthy to shrink the wealth gap. But is it true that the rich are getting richer? Or are the rich actually in danger of losing a significant portion of the nation’s wealth? Are the democrats worried about a problem that’s already being fixed by the markets?
Emmanuel Saez, the income-share expert and economics professor at the University of California, Berkeley told Robert Frank of the Wall Street Journal that during the Great Depression, the income and wealth of the top 1% of society fell drastically. (Read here for the full story). If history is to be believed then this will happen again especially if Obama becomes president.
What does this mean fore the green economy? Spreading the wealth might help increase jobs however the indicators are that the funding is drying up for the green start-ups (Reuters). If the top income sector is to lose wealth then who will invest in the green entrepreneurism that will fuel a green economy that desperately needs to be built?