Sunday 2012-12-02

Many commentators have recently been concerned that wealth inequality has risen in the US over the last 30 years. However, they go on to heap scorn on evil companies, executives, corrupt governments, etc.

While those actors are probably not without culpability, the typical commentator leaves out the average person in the US who has a self-directed 401(k) and some personal money in the stock market.

As the chart above indicates, the market cap of the S&P 500 went from 1e12 USD in 1981 to over 1e13 now. As a collective whole, we moved over 9 trillion dollars into the S&P 500.

As we were buying, who was selling? The owners of those companies, and additionally the top 5 or so executives who received the bulk of the stock options granted.

It seems awfully disingenuous to say that we face wealth inequality and simultaneously not discuss our own guilt in the matter. After all, we of our own free will gave them all those trillions of dollars.