Why Trickle-Down Economics Doesn't Work
From
Joseph Pereira@1:124/5016 to
All on Fri Aug 15 06:01:12 2025
The core of Trump's economic policy is "trickle-down economics". This means: make the super-rich even richer, and their wealth will trickle down to the rest of society.
That's complete nonsense, and I'll explain it in "Mickey Mouse language" so everyone can understand why it doesn't work.
When the super-rich get richer, they don't eat more or go to restaurants more often. They don't buy more TVs, more computers, etc.
So, a very small group of ultra-rich people stays rich and keeps everyone else poor. They buy more shares in companies, etc., but they don't consume more. This last part is important, and I'll come back to it.
Now, imagine doing it differently.
What happens if you give the middle class more financial room?
The middle class starts eating out more, which creates jobs for the lower class. The waiters and dishwashers get work and can move up into the middle class, where they will do the same.
Our economy is 70% consumer spending. That alone explains why it will never work to give money only to the super-rich. If you want to grow, the best thing to do is to grow the 70%. You do that through the middle class. After all, they spend their income and keep the economy growing.
If the middle class grows, the economy grows.
So, trickle-down is the game the super-rich play to enrich themselves and impoverish everyone else.
Ultimately, they don't gain much from it either, because the economy will eventually start to shrink and, if they don't change course, will collapse.
If you strengthen the middle class, more money circulates and more goods are demanded. That's good for businesses, which make more profit, and it's good for the government, which can collect more taxes. The gap between the ultra-rich and the middle class shrinks. Getting rich becomes less exclusive. That point may also play a role for the ultra-rich, who want to feel superior to the "plebs". That feeling diminishes when the middle class gets richer.
Unfortunately, laws are drafted under the influence of the world's wealthiest people. Through their lobbying and the influence of their absurd wealth, they can repeatedly install politicians who carry out their agenda.
The middle class doesn't have that political influence.
That's why you see politics constantly moving toward trickle-down economics. The US is a very clear example of this, but in Europe, too, you repeatedly see the rich getting benefits because they're supposedly so "pitiful".
It is partly this flaw within democracy that keeps the poor poor and makes it necessary to have soup kitchens and food banks. There is enough for everyone in the West, but we distribute it too unfairly.
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