As US income inequality began a marked increase in the 1980s, the richest 1 percent of households increased their savings while the bottom 90 percent fell into debt. Research finds that lenders indirectly used the top 1 percent’s savings to finance this borrowing, essentially enabling the rich to benefit from the bottom 90 percent’s debt repayments.
This does not imply causality as the author mistakenly assumes. Maybe the bottom 90% have more debt simply because costs are rising faster than wages and ability to save. Maybe the rich can save more because thy earn more.
This does not imply causality as the author mistakenly assumes. Maybe the bottom 90% have more debt simply because costs are rising faster than wages and ability to save. Maybe the rich can save more because thy earn more.