Democrats bash corporate greed, but more stocks for all Americans may be a better wealth redistribution method
Democratic Party leaders have made Wall Street "greed" and corporate financial engineering, such as stock buybacks, a priority of efforts to reduce wealth inequality. Policy recommendations to tax stock market gains and target private equity are popular, but one idea that many high-profile Democratic hopefuls have supported in the past has not received much attention on the campaign trail: Granting stock ownership to more Americans.
The latest monthly jobs report continued to show a solid job creation pace and low unemployment, but during the past decade of economic recovery, the top 10% of households have seen a disproportionate increase in wealth, as most of the gains went to the stock market.
In 2016, the richest 10 percent of the country owned 85% to 90% of financial assets, with the top 1% owning more than half, according to a paper by New York University economics Professor Edward Wolff. Meanwhile, a recent national survey by the Federal Reserve found that roughly 40% of Americans could not afford a $400 emergency expense — 27% would be forced to sell something or resorting to a loan; 12% would not even have those options available to fund the expense.
While workers at large publicly traded companies have access to employer stock plans — often at discounts to current market value — as well as compensation in the form of stock options, that is not the case for the majority of Americans employed by private companies.