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Alternative Visions – Covid Recession Year One: Who Gained, Who Lost?

Topic of today’s show is who has gained in income terms over the first full year of the Covid induced US recession. Dr. Rasmus looks at the period, 2nd quarter (April-June) 2020, when the US economy crashed and compares it to most recent quarterly data in 2021 for April-June this year. Those receiving capital incomes and corporations registered record gains: billionaires in US increased their wealth by more than $1 trillion, stock investors enjoyed record levels of price gains, and Fortune 500 corporations recorded record revenue gains of 24.7% over the past year. On the negative side, workers’ wages in net terms fell as more than 35 million were jobless at some point during 2020 and hours of work were cut drastically for many still with jobs. Meanwhile, CEO pay rose 18.9%. Small businesses also did poorly, even as more than $1 trillion in loans and grants were distributed. Nearly 1 million small businesses failed nonetheless and millions more suffered significant income losses despite receiving partial loans. Dr. Rasmus addresses losses experienced by renters as $70 billion or more of forbearance (suspended) is yet to be paid, while landlords continue to block distribution of $47 billion in rental assistance payments. The role of the US Supreme Court in preventing the evictions moratorium is discussed. Student loan forbearance is added to wages, jobs, and renters as those who have not gained over the past year. In short, wage incomes, small businesses, and transfer payment recipients have lost, while investors, big corporations and bankers have gained most.

 

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