> How are they continuously extracting income of the middle and lower classes (and upper too)?
1. Through ownership of the means of production. Profit from said means largely goes to the very rich, or to the upper-middle class - almost everyone below them does not really participate in the stock market, and most definitely don't participate in ownership of non-public firms.
2. As such, as lower classes create wealth, it flows upward. When the economy grows quickly, that wealth tends to get re-invested into building more means of production. But at the end of the day, those investments are on aggregate, expected to generate returns.
So, through growth, you can postpone the trickle-up, but unless there's a huge societal shift, at the end of the day, even if the pie grows, the lower classes won't get any more pieces of it.
Caveats:
(Yes - quality of life has gone up in the developed world thanks over the past century. That is due to technological advancement. Yes - quality of life has gone up in the developing world due to globalization. But how many people in Bangladesh making sneakers own shares in their employer? How much of the Western economy will the people doing all the work that keeps it running have come to own over the past 30 years?)
1. Through ownership of the means of production. Profit from said means largely goes to the very rich, or to the upper-middle class - almost everyone below them does not really participate in the stock market, and most definitely don't participate in ownership of non-public firms.
2. As such, as lower classes create wealth, it flows upward. When the economy grows quickly, that wealth tends to get re-invested into building more means of production. But at the end of the day, those investments are on aggregate, expected to generate returns.
So, through growth, you can postpone the trickle-up, but unless there's a huge societal shift, at the end of the day, even if the pie grows, the lower classes won't get any more pieces of it.
Caveats: (Yes - quality of life has gone up in the developed world thanks over the past century. That is due to technological advancement. Yes - quality of life has gone up in the developing world due to globalization. But how many people in Bangladesh making sneakers own shares in their employer? How much of the Western economy will the people doing all the work that keeps it running have come to own over the past 30 years?)