By Granite State Report
The core claim
America has an oligarchy problem. Wealth and political influence have consolidated so tightly at the top that broad prosperity and majority preferences are routinely sidelined. That’s not a slogan; it’s what the best data says about income distribution, wealth concentration, and who actually shapes public policy.
The long arc of inequality
Start with incomes. The Congressional Budget Office’s long-running series shows that since 1979, income growth has tilted heavily toward the top, even after taxes and transfers. In the 2010s and through 2020–2021, the top 1% increased their share of post-tax, post-transfer income, while lower quintiles saw far smaller gains; the temporary pandemic transfers muted (but did not reverse) the longer trend.
On market incomes (before taxes and transfers), the shift is starker. Using tax data, economists Emmanuel Saez and colleagues estimate that by 2022 the top 1% captured roughly 23–24% of total pretax income—near modern highs—and took the lion’s share of post-pandemic income growth.
From unequal paychecks to captured balance sheets
Inequality in wealth (what families own minus what they owe) is even more extreme than inequality in income (what families earn in a year). Federal Reserve Distributional Financial Accounts show the top 1% now own roughly one-third of all household net worth, and the top 0.1% alone hold a historically high slice—levels not seen in decades.
The latest Survey of Consumer Finances underlines the spread: in 2022 the median U.S. household’s wealth was about $162,000, while the bottom tenth effectively had none. When asset prices surge—as they did in 2020–2023—the asset-rich pull further away.
Zoom in on the ultra-rich: during the pandemic and its aftermath, U.S. billionaire wealth nearly doubled, rising from ~$3.0T (March 2020) to ~$5.5T (March 2024), according to tabulations of Forbes data by the Institute for Policy Studies. This is not a vibes chart; it’s an audited one-two punch of asset inflation and policy design.
Market power, markups, and monopoly rents
Why has so much of national income migrated to capital owners? Part of the answer is market power. A broad empirical literature finds rising markups (prices over marginal cost) since about 1980, driven by the upper tail of firms with the most power. Higher markups mean profits accrue to owners rather than workers or consumers. This pattern is documented in peer-reviewed studies and surveyed by the Federal Reserve and academic reviews.
Oligarchy isn’t just about money—it’s about power
The political science here is blunt. In a widely cited study covering hundreds of policy outcomes, Gilens and Page conclude that economic elites and business groups have substantial independent impacts on U.S. policy, while average citizens have “little or no” independent influence. You don’t need to love the paper to absorb its warning: concentrated wealth begets concentrated power.
Campaign-finance jurisprudence has supercharged that dynamic. Citizens United v. FEC (2010) removed limits on independent political spending by corporations and unions, magnifying the role of big money and “outside” spending in elections. Even neutral summaries by the FEC and legal databases characterize the ruling as a watershed.
What changed for the median American?
A RAND analysis reframes the last half-century as a counterfactual: what if the post-war distribution of growth had merely held steady after 1975? Answer: workers below the 90th percentile would have taken home roughly $47 trillion more (1975–2018) than they actually did. That is a staggering drag on household security and aggregate demand.
New Hampshire: a “high-income, high-inequality-after-taxes” paradox
New Hampshire boasts one of the highest median household incomes in the country. But median strength can mask distributional stress—and our tax structure amplifies it. The latest Census brief provides the Gini index by state (a standard inequality measure) and shows how it has shifted year to year. Meanwhile, the Institute on Taxation and Economic Policy (ITEP) finds New Hampshire’s state and local tax system is regressive: lower-income Granite Staters pay a much higher share of their income than the top 1%, thanks to heavy reliance on property and consumption taxes and the absence of a broad income tax. That’s how you get a prosperous state where the ladder’s bottom rungs still snap.
Why this matters (beyond fairness)
Extreme concentration isn’t just morally itchy; it’s economically inefficient and politically destabilizing:
- Weaker transmission of growth: When income gains pool at the top, the marginal propensity to consume falls; growth depends more on asset prices than paychecks. Fed wealth data and SCF trends tell you who benefits when markets boom.
- Rent extraction over innovation: Rising markups point to profits powered by market power, not pure productivity—an economy collecting tolls instead of building lanes.
- Policy capture: The empirical link from money to policy outcomes is not hypothetical; it’s measured.
What would bend the curve?
Practical, evidence-based moves exist. None is a silver bullet; together they’d dent oligarchic power and widen the gains from growth:
- Tax the top effectively (not theatrically).
- Enforce the tax code we already have: the Inflation Reduction Act’s IRS investments are projected to yield substantial revenue from high-income tax evasion; preserving enforcement capacity is a no-brainer.
- Consider targeted surtaxes on very high incomes and reforms to capital income preferences; internationally, the OECD documents how post-tax redistribution differs across rich countries—ours is middling given our pre-tax inequality.
- Close wealth-shielding loopholes. End games like stepped-up basis abuse at death, lightly taxed pass-throughs that function as wage shelters, and dynasty-trust strategies that turn tax deferral into de facto exemption. (These are standard recommendations across inequality and tax-policy literature; IPS’s billionaire wealth work tracks the stakes.)
- Rebuild antitrust for the age of platforms and private equity. The markup literature signals where enforcement should focus: the upper tail of dominant firms. A modernized antitrust posture—merger scrutiny, interoperability mandates, and limits on anticompetitive roll-ups—aims directly at monopoly rents.
- Democratize political finance. Within the bounds of Citizens United, states and Congress can expand small-donor matching, require real-time disclosure of independent expenditures, and tighten coordination rules between campaigns and outside groups. The legal baseline is clear; the policy space is large.
- Wage and ownership ladders. Proven tools—tight labor markets, stronger wage floors, and sectoral bargaining—raise labor’s share. Pair that with broad-based asset building (auto-enrolled employee ownership, baby bonds, matched savings). The macro goal: more households with something to lose and to invest.
- Fix New Hampshire’s regressivity. If we won’t adopt a broad income tax, we can still relieve bottom-quintile burdens: circuit-breaker credits against property taxes, renter credits, and a graduated real-estate transfer tax that asks more of eight-figure deals than starter homes. These are consistent with ITEP’s diagnosis of where the tilt lives.
The bottom line
An economy where a thin slice of households claims a third of the wealth and growing policy sway is not a free-market Eden—it’s a rigged marketplace with a democratic façade. The remedy isn’t envy; it’s engineering: enforce the laws, restore competition, rebalance tax burdens, widen asset ownership, and detox our campaign-finance ecosystem. That’s how you turn an oligarchy back into a republic.
Sources & further reading
- Income distribution: Congressional Budget Office, Trends in the Distribution of Household Income (1979–2020) and 2019 distribution report.
- Top income shares: Saez (update through 2022), “U.S. Top Incomes 2022.”
- Wealth concentration: Federal Reserve Distributional Financial Accounts (top 1% and top 0.1% shares).
- Household wealth detail: Federal Reserve, Survey of Consumer Finances (2022).
- Market power literature: De Loecker–Eeckhout–Unger (QJE), Federal Reserve survey/notes, and academic reviews.
- Democratic responsiveness: Gilens & Page (2014), Perspectives on Politics.
- Campaign finance baseline: Citizens United v. FEC, primary legal summaries.
- Billionaire wealth surge: Institute for Policy Studies analyses of Forbes data (2020–2024).
- NH distribution & taxes: U.S. Census ACS brief (2023 data), and ITEP’s Who Pays? state profile.
