Week-end Wrap – Political Economy – December 21, 2025
by Tony Wikrent
Strategic Political Economy
The $79 Trillion Heist
Harold Meyerson, December 03, 2025 [The American Prospect]
…As Emma Janssen has reported in these pages, marketers are going where the money is, like bank robber Willie Sutton. First-class and business-seat travel on the airlines is booming, so much so that seating arrangements on Delta and United are being reconfigured to create more room for the affluent, while coach seats are going unfilled and “discount” airlines struggle. Revenues are up 3 percent this year at the Ritz-Carltons, the Four Seasons, and other luxury hotels, yet down by 3 percent at economy hotels. And when it comes to life’s biggest purchase—a home—the median age of first-time buyers reached 40 this year, an all-time high according to the National Association of Realtors….
Life in the nonaffluent nation is getting harder. According to a Brookings Institution analysis from last year, 43 percent of American families don’t earn enough to pay for housing, food, health care, child care, and transportation; every week, they must juggle which to pay and which not to pay. Among Black and Latino families, those figures rise to 59 percent and 66 percent, respectively….
What would America look like if the gap between worker pay and productivity hadn’t opened? A RAND Corporation study from earlier this year found that the bottom 90 percent of wage earners received about 67 percent of all taxable income in 1975. In 2019, the last year for which this data was available, they received 46.8 percent. Had that bottom 90 percent continued during the past half-century to make the same share of the national income they’d had in 1975, RAND calculates that by 2023 they would have made an additional $79 trillion. Just in the year 2023, they would have made an additional $3.9 trillion. As the size of the bottom 90 percent of the U.S. workforce is roughly 140 million people, that means that the average earner would have made about $28,000 more in 2023 than they actually did.
Where have all those missing $28,000 paychecks gone? Well, our nation was home to 1,135 billionaires this year, whose aggregate net worth in 2024 came to a cozy $5.7 trillion. That’s $1.8 trillion more than what it would take to cut 140 million $28,000 paychecks.…
[TW: Meyerson then summarizes the responsibility of Ronald Reagan for this economic devastation, enumerates the specific policy changes Reagan implemented, and seven policy changes needed to reverse this descent and begin to rebuild the US economy and restore general widely shared prosperity.]
The Housing Crisis Is A Democracy Crisis
Evelyn Quartz, Dec 16, 2025 [The Lever]
…French philosopher Alexis de Tocqueville, among the young nation’s first chroniclers, came to believe that Americans’ propensity to form civic associations created the lasting bonds that were the country’s real defense against tyranny. Without communal ties and shared responsibilities, Tocqueville feared individuals would fall prey to paternalistic “soft despotism,” in which top-down state administration replaces self-government.
In such an arrangement, he wrote, “Each [citizen], living apart, is as a stranger to the fate of all the rest… he exists but in himself and for himself alone; and if his kindred still remain to him, he may be said at any rate to have lost his country.”
In 2025, both Jefferson’s and Tocqueville’s warnings could not be more relevant. An all-powerful corporate state has robbed ordinary citizens of the ability to put down roots. Without a stable, affordable place to live, civic associations, and the bulwark they provide against tyranny, wither away. The housing crisis is thus a democracy crisis….
America’s housing stock — once supported by strong public initiatives like the New Deal housing programs — was steadily financialized with the help of policymakers. Under the rhetoric of “individual choice” and the rise of neoliberal economics, public housing programs increasingly subsidized the private market.
The clearest example of this is the federal Section 8 voucher program, launched in 1974. The program required qualifying tenants to redeem affordable-housing vouchers in the private housing market. This allowed policymakers to back away from bold investments in public housing and hand responsibility instead to private actors.
In 2008, the neoliberal outsourcing of the housing market to Wall Street imploded the global financial system. As a result, millions of Americans lost their homes and were driven deeper into financial instability, as banks and private equity firms tightened their control over American life.
President Barack Obama inherited a collapsing economy, much as Roosevelt had seven decades prior. But instead of rescuing the common citizen — a mission central to Roosevelt’s response — Obama bailed out banking executives while offering struggling homeowners technocratic private-sector solutions like the Home Affordable Modification Program, which sought to modify loans rather than provide direct relief.
As a result, private equity giants subsequently cashed in on the financial crisis by buying up hundreds of thousands of foreclosed homes to rent out for profit.
Now, instead of helping more people become rooted in their communities, housing is dominated by rentier capitalism: a system in which homes are treated not as places to own, nor to participate in democratic life, but as financial assets. Today, a handful of consolidated private landlords dominate the rental market. The largest, Greystar Real Estate Partners, manages nearly a million rental units in the United States and was sued by the Federal Trade Commission earlier this year for allegedly burdening tenants with hidden junk fees…
A perfect distillation of the social uselessness of finance
Cory Doctorow, 18 Dec 2025 [Pluralistic]
How Capitalism Replaced America
[Murtaza Hussain, via Naked Capitalism 12-17-2025]
Why economic policy matters for the Greens
Richard Murphy, December 15, 2025 [Funding the Future]
… This results, first, in their inability to explain the role of money, tax, borrowing, and the whole fiscal management cycle that lies at the core of macroeconomics, and second, in their failure to confront how economic power is exercised in modern economies, which confrontation is inevitably required to deliver the green transition we need….
The green transition, on which I have campaigned for a long time, will not be delivered by good intentions, ethical markets, or better pricing signals alone. It will only be delivered when political movements are willing to challenge the power of finance and markets directly, together with the flawed ideas on which their supposed power is based. And that cannot be done without understanding the role of money creation and the state’s capacity to use it for public purposes.
The problem is not that the Greens care too little about economics. It is that too many of them might accept an economic framing that treats markets as the ultimate arbiters of what is possible. Within that potential framing, government is cast as financially constrained, dependent on private capital, and permanently at risk of market punishment. As a result, green ambition could be trimmed to what markets will tolerate, not what climate science demands, and that is how radicalism is quietly neutralised, as I fear might be possible if those whom I am challenging get their way.
If you accept that the state must first persuade or appease financial markets before it can act, then the green transition is already compromised. Large-scale public investment becomes conditional. Industrial strategy becomes hesitant. Public ownership becomes politically “difficult”. And climate action is reduced to nudging private behaviour rather than reshaping the economy….
Markets do not lead transitions that undermine their own profitability. They resist them. That resistance can only be overcome by a state willing to act decisively: investing directly, owning strategically, regulating firmly, and accepting that public purpose must take precedence over private return. But that requires abandoning the idea that the state must ask permission from capital before it acts….
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