The GOP Tax Plan Will Complete the Destruction of America’s Middle Class Wealth
In fact, if the GOP tax plan becomes law, we may be looking at a future where our 1,600 richest hold more wealth than the nation’s entire middle class.
The wealth of America’s middle class, under siege for four decades, is now hanging on life support. That life will end if the basic Republican tax plan, as now envisioned by House and Senate majorities, ever becomes law.
By “middle class,” we mean America’s “Middle 40,” that stratum of American households that has more wealth than the nation’s poorest 40 percent and less wealth than the nation’s most affluent 20 percent.
In 2001, according to the Federal Reserve’s recently released Survey of Consumer Finances, the most systematic official survey of who owns what in the United States, the nation’s Middle 40 held 15.2 percent of the country’s wealth.
The new century has not been kind. By 2016, that share had dropped to 10.6 percent, a figure that leaves the entire Middle 40 — about 128 million Americans in all — sharing slightly less wealth than the 32,000 exorbitantly wealthy individuals who make up the nation’s richest .01 percent. In other words, each American in that top .01 percent holds as much wealth as 4,000 of the Americans in the Middle 40.
Those provisions in the GOP tax plan that reduce the tax benefits that come with mortgage interest and property tax payments and increase the effective tax homeowners pay when they sell their homes will depress the wealth of the middle class much more than the wealth of the wealthy.