In colloquial speech, “the economy” is often described as a unitary thing. More than any other event in recent history, the coronavirus pandemic has exposed this as pure fallacy: the stock market quite literally soaring even as millions struggle with joblessness and financial insecurity.
As of earlier this month, some eighteen million Americans remained on the unemployment rolls, and according to new research, roughly half of households have lost income over the past year. It’s increasingly well understood that the economic outlook looks very different for the most affluent: average bonuses for Wall Street employees rose by 10 percent in the last year to $184,000 according to a particularly emblematic estimate just released by the New York State comptroller.
In many ways, however, COVID-19 has simply accelerated a basic trend underway for decades — namely growth for those at the top and stagnation or regression for the less well-off. A new report published by the Institute for Policy Studies makes this case with particular force. Assembled by the institute’s Sarah Anderson, the study examines data on Wall Street bonuses compiled since 1985 — noting that the total bonus pool for New York’s 182,100 Wall Street employees was a whopping $31.7 billion in 2020 alone: enough to compensate a million jobs paying $15 an hour for a full year.
The real kicker, however, is Anderson’s finding that the average Wall Street bonus has increased some 1,217 percent in the past thirty-six years — a rate of growth which has, to say the least, dramatically outpaced growth in the federal minimum wage, which has been fixed at $7.25 an hour for over eleven years (in fact, the longest it’s gone without being raised since 1938). If the minimum wage had increased at the same rate, concludes Anderson’s analysis, it would currently sit at $44.12, or just over $91,000 a year. The minimum wage has not only remained frozen for over a decade (with the fate of long-standing efforts to raise it to $15 an hour still uncertain in Congress) but has actually shrunk in real terms by 11 percent since 1985.
Another stark data point reveals the extent to which America’s bifurcated economy is also characterized by deep inequalities of race and gender, with major securities firms being overwhelmingly white and male and minimum wage workers disproportionately women and people of color: across the United States, some 63 percent of those employed in the securities industry are men, who correspondingly make up only 33 percent of minimum wage workers.
All told, Anderson’s study is another illustration of Reaganism’s astonishing conquest of American society since the 1980s and the urgent need for a redistributive political agenda. Wall Street bonuses increasing by more than 1,200 percent while the minimum wage decreases in value? Absent a room full of cigar-brandishing pigs in dinner jackets, capitalism couldn’t be making it any more overt than that.