As an Indian I am not surprised to learn from Robert Reich's post that the top 0.1% of Americans control $20 trillion in wealth and the bottom 50% control $3.7 trillion in wealth.
I have been haplessly observing the brutality of inequality since my childhood while putting my best efforts to remain on the other side.
Our estimates suggest that inequality declined post-independence till the early 1980s, after which it began rising and has skyrocketed since the early 2000s. Trends of top income and wealth shares track each other over the entire period of our study. Between 2014-15 and 2022-23, the rise of top-end inequality has been particularly pronounced in terms of wealth concentration. By 2022-23, top 1% income and wealth shares (22.6% and 40.1%) are at their highest historical levels and India’s top 1% income share is among the very highest in the world.
In other words, the ‘Billionaire Raj’ headed by India’s modern bourgeoisie is now more unequal than the British Raj headed by the colonialist forces. It is unclear how long such inequality levels can sustain without major social and political upheaval. While there is no reason to believe income and wealth inequality will slow down by itself, historical evidence suggests that it can be kept in check via policy.
The root cause may be absence of appropriate policies through legislation.
The authors of the above mentioned paper lament that:> In line with earlier work, we find suggestive evidence that the Indian income tax system might be regressive when viewed from the lens of net wealth. We emphasize that the quality of economic data in India is notably poor and has seen a decline recently. It is therefore likely that our results represent a lower bound to actual inequality levels.