0 Vacuum Up - the reality. Trickle Down - the lie.
- by Adrian Mark Dore
I am sure you have heard of the fallacy Trickle Down? If not, here’s a brief synopsis of the fantasy which so many believed. Some may still believe it, despite the weight of evidence to the contrary being so great as to throw the earth off its axis. The fantasy goes like this, “Allow the rich to accumulate as much wealth as possible because then some may trickle down and benefit you."
The idea that you should forfeit your meagre wage so the rich may accumulate as much as possible, in return for which you may get a small portion back, sounds absurd. It is absurd. However, when the rich first peddled this fairy tale, it was couched in different words intended to mislead.
It was sold on the basis that the rich were better and more knowledgeable in investing money. The more money they had would result in more productive investment, ultimately benefiting the majority by creating a bigger economic base. Benefits would trickle down and we would all be better off. There’s a shred of believability to this, except, from the outset, this was never their intention.
The whole process has been highly dishonest and manipulative. It involves a two-pronged approach. Firstly, they weaken the majority, making them vulnerable to exploitation, using free market economics (sometimes called neoliberal policies.) They then develop rental businesses to exploit these vulnerabilities. These rental businesses and their exploitative business practices have been designed to vacuum up every morsel from the poor man’s table. These vacuum-up processes, together with associated practices and procedures, work well. That’s why the rich keep investing heavily in them rather than in our real, productive economy.
You’ve heard of trickle-down, but probably not vacuum-up. Yet trickle-down is a fairy tale and vacuum-up a reality. This shows how well the rich hide the truth and mislead us. My article, “The truth about capitalism” describes how the wealthy create a smokescreen to hide the real problems, to stop people from digging deeper, to find the real cause of our problems.
Free market economics is used to weaken labour. They break the power of unions and suppress wages over decades. As a result, real incomes declined significantly.
As part of the free market dogma, they call for smaller governments, which results in governments curtailing the services they previously supplied in sectors such as: -
- Social services
- Unemployment support
- Security (Policing)
- Other services (too numerous to mention.)
This leaves people more vulnerable and desperate. Those fortunate enough try to plug the gap left by these reductions using their own resources if they can. This opens opportunities for the rich while lowering the quality of life for the majority. Mental wellness declines rapidly.
Having weakened the majority, they are left vulnerable to exploitation, using these rental services: -
- Holding wages down reduces consumer spending power. However, to ensure sales do not slip, and thus their profits, they provide the masses easy, unsecured credit. This opens up a vast and highly profitable new rental market for the rich while driving the masses into substantial debt.
- Much of the lending is predatory. Preying on the most vulnerable and charging exorbitant rates. Payday loans are an example of this.
- Holding wages down forces more and more people to become home renters. This opens up a substantial rental business for the rich. The wealthy compete with ordinary people to buy up houses. They force up prices, making it difficult for first-time buyers to get onto the housing ladder. Most are left behind to become life-long renters. These renters will eventually end up paying well in excess of the purchase price while the rich own the asset. This creates a potential problem for the government when these renters retire, yet rents keep escalating. Who provides housing for them, and at what cost?
- As the average person becomes progressively poorer and desperate, many turn to gambling as a possible “solution”. Online gambling has exacerbated the problem while creating a massive rental business for the rich. They make the situation worse by allowing people to pay using credit.
- People become more vulnerable in the absence of government support or reduced support. To protect themselves, those fortunate enough increase their insurance cover, thereby opening up a further lucrative rental market for the rich.
- Increased financial pressure on the majority, in combination with increased advertising hype from manufacturers, opens up greater rental opportunities for the rich. As people can no longer afford to buy things outright, rental schemes become more attractive. They roll these rental schemes up with a service and insurance agreement, further milking the poor man. This includes an ever-increasing array of products, such as: -
- White goods
- The drive to make the majority own nothing and rent everything is relentless as the wealthy redirect more capital out of our real economy into the rentier economy.
Hopefully, this short article will remind us why free market economics and the rentier economy form part of the Triad of Evil, together with their co-conspirator - globalisation.
When we consider the reason free market economics was granted concessions in the form of reduced tax and regulation, it was on the proviso that they would invest in our real productive economy and not the unproductive rentier economy. Investment in the rentier economy hurts the majority. It does not benefit them. Therefore, as the wealthy have not delivered against their promise, it’s time to increase taxes significantly and reintroduce regulations to protect the majority and the environment, which they have exploited. It’s also time to raise taxes on all rental incomes to discourage investment in the rentier economy.
You may read other articles by Adrian Dore on Medium at