The dominance of monopolism in our market means it's anything but free. It's a captive market in which consumers have no choice but to pay through the nose for what they want or go without. Profiting in a captive market is extortion. We all know in our hearts it's not fair so we tax the rich severely to pay for welfare because they owe the poor for their prosperity. The hallmark of a free market is the absence of monopolies and stock markets. Profits are only earned in the face of unrestricted competition.
Yup. There are baseless theories about investment in stocks helping finance industry and that your purchase is therefore your vote on what businesses are desirable and preferred. None of that is true. Stock purchases are gambles. It's a series of transactions between individual investors each trying to get some of the money of other investors for themselves. Approximately 95% of stocks are owned by the top 5% of the population. So look what has been happening and who it benefits: The FED has since about 2007 injected about $6 trillion into the stock market. https://en.wikipedia.org/wiki/Quantitative_easing Whenever the market shows weakness and decline threatens, the Fed has been jumping in with new investments to stop any retraction, even though capitalist economists love to talk about the glories of "free markets". So let's think about how "terrible" high taxation of the rich may be for a moment. Do the poor benefit from such taxation by receiving more "welfare"? What actually is happening is that the Fed is pumping money into the stock market for the benefit of corporate elites at the top of the food chain. They are "compensated" not only with salaries, but even more so with back-dated zero-cost stock options. And as the underlying security increases in value, those stock options multiply in value. And being insiders with their fingers on the pulse of the business, they know well ahead when their companies are expected to fall in value, and they are able to divest themselves of their shares six months ahead of a fall, thereby escaping charges of insider trading. THEN, after directly benefitting from Fed injections of money into the market, when it comes time to pay off the federal debt it is the taxpayer who is asked to shell out the money. This constitutes a direct redistribution of wealth from the average taxpayer to the pockets of the rich. Sure the taxable income of the rich is taxed, but mostly at a lower rate than the average middle class taxpayer rate. And meanwhile, their "discretionary income" is plowed into tax-advantaged investments like preferred stock paying dividends, tax-free bonds, and real estate that gets them deductions. So is it a mystery that we are seeing an explosion in wealth and income disparity?
