Post middle-class politics?

Earlier in the quarter, we discussed about American Dream and the middle-class. As income inequality continues to grow bigger and bigger, it seems like there is no place for the middle-class; meritocracy no longer applies to American Dream. America as a middle-class nation is deeply ingrained in the country's politics "whether it defines a concrete socioeconomic identity—a country where most people are neither very rich nor very poor—or an aspiration, the notion that if you work hard and play by the rules." The phrase "everyday Americans" now represents the fragmented economic realities of the 21st-century middle class. 

The aspirational idea of the middle class spoke to the notion that even if Americans were in various stages of prosperity, they were all understood to be heading in the same general direction. But what happens when that's no longer true? On one end of the "middle class" spectrum is a dream inexorably receding from view; on the other is a pair of socioeconomic blinders obscuring the harsher economic realities of those further down the scale. 

Is Piketty right about inevitability?

Quartz has an article about the uneven economic geography of America (see here) .  In effect, we have two American economies. One is made up of expensive
coastal zip codes where the pundits proclaiming “recovery” are
surrounded by prosperity. The other is composed of heartland regions
where ordinary Americans struggle without jobs. Over 50 million
Americans live in what the Economic Innovation Group calls “distressed communities”—zip
codes where over 55% of the population is unemployed. Of those
distressed communities, over half are in the South, defined generously
by the census as the region stretching from Maryland and Delaware to
Oklahoma and Texas. The rest tend to live in Midwest rust belt cities
that have long suffered from economic decline, like Gary, Indiana and
Cleveland, Ohio. It is nearly impossible for Americans of the latter
group to move to the cities of the former group—or to work in the
industries that shape public perception of how the economy is going.....In 2015, the number of Americans who moved across state lines was reported to have fallen to a low not seen since 1947. Barriers to moving include a massive drop in personal savings:
62% of Americans have less than $1,000 and are unable to afford
relocation costs. This was not always the case. Among those who had
savings prior to 2008, 57% said they’d used some or all of their savings
in the Great Recession. The soaring cost of living in cities with
healthy economies combined with the low wages of America’s distressed
heartland has locked many Americans in place.

The mega tax-payer dilemma

I found an interesting article about mega tax-payers that could possibly influence the state budget. The hedge-fund billionaire in New Jersey, David Tepper, earned more than $6 billion from 2012 to 2015. Tax experts say that his move to Florida could cost NJ millions of dollars in lost payments. Tepper's move shows how tax collections are affected when income becomes very highly concentrated. In states like New York and California with high tax rates, the top 1 percent pay a third or more of total income taxes, so even a single individual like David Tepper can have a noticeable impact on state revenues and budgets. Some experts say that each state should keep tracking and forecasting the incomes of the top earners and keep them from leaving.

“In a time of rising inequality, I’m not sure the right answer is lowering taxes or making them less progressive,” said Kim S. Rueben, senior fellow of the Urban-Brookings Tax Policy Center at the Urban Institute. “It’s more about keeping an eye on people, seeing where they are and enforcing the tax rules.”