Joseph Blasi
Many of America’s Founders believed that excessive wealth inequality would be incompatible with having a representative republic. They did not expect wealth to be identically distributed, but many did envision a thriving middle class with very broad-based capital ownership and they supported muscular government policies to allow citizens to acquire property on an ongoing basis. Following their lead, our principal strategy to deal with wealth inequality should be to make every citizen a capitalist by encouraging meaningful broad-based profit sharing and employee ownership and remaking our tax system to make this possible.
In his 1787 book, “A Defense of the Constitutions of the Government of the United States,” John Adams, later the second U.S. president, wrote: “If all power be suffered to slide into hands not interested in the rights of property … one of two things cannot fail to happen.” His first prediction was that the majority “will unite against” those with property. His second prediction was that the dependence of the majority “will render them mercenary instruments of wealth.”
Adams opened this passage by asking his readers to imagine a nation with a population of 10 million where 1 or 2 million owned most of the property and 8 or 9 million had very little wealth. How prescient! Today, for total U.S. wealth and many specific asset classes of wealth, such as all capital gains, America is approaching a situation where the top 10 percent or the top 20 percent hold far more wealth than the 80 percent of land held by the English aristocracy at the time of the American Revolution.