The rich are getting richer and and that's bad news for a shrinking middle class

The rich are getting richer and the poor are getting poorer, at least in the United States. The good news is that if the American voter wakes up, it can change. The top 1 percent of families now take home an average of 30 times as much income as the bottom 99 percent, and US households in the bottom quintile earn just 3% of all income. It wasn't always this way. When the income tax was first put in 1913, only the top 3% of high-income earners were taxed. The share of income held by the top 1 percent declined and the middle class expanded. But since the 1980s and trickle-down economics was implemented at the national level, real wages for middle class and lower class workers have declined even as unemployment remained low and the economy flourished. Even today with an unemployment rate of 3.6% and 11 million open job positions, real disposable income after inflation dropped by 0.4% last year.Although workers are still overall have adequate purchasing power, since 1980 and Reaganomics every decade has eroded purchasing power for the working class and fewer people are in the middle class than at the start of Reaganomics.

And now the middle class and workers are bearing the brunt of three decades of regressive tax policy as well.After a succession of massive tax cuts to the wealthy under Presidents Reagan, George W. Bush, and Donald Trump, workers in the middle class now pay the highest rate of taxes among all income earners--higher than even the high-income groups. Meanwhile, with the rich off the hook from paying their fair share, the national debt has exploded to $30 trillion and there is no money for roads, health care, and education. The solution to saving the evaporating middle class is clear and common sense. Lower the taxes for low- and middle-income workers, and raise taxes on high-income earners back to their levels of the 1990s. With more money in the pockets of more workers, greater private investment and a bigger middle class will follow and federal deficits will be a thing of the past.

2A. From information in the article state the economic theory advocated by the author.

2B. Consistent with the author's economic theory, construct a Macro Model of the economy in 1980. Label initial curves and initial Price Level and Real GDP with subscript "1".

2C. Consistent with information in the article, set out an appropriate causal chain illustrating the economic policy proposed by the author that affects aggregate demand. If aggregate demand is not affected by the economic policy, write "No change to aggregate demand."

2D. Consistent with information in the article, set out an appropriate causal chain illustrating the economic policy proposed by the author that affects aggregate supply and/or long-run aggregate supply and/or short-run aggregate supply. If aggregate supply is not affected by the economic policy, write "No change to aggregate supply."

2E. Return to the Macro Model in 2B and illustrate the theorized changes to the economy the author argues will ensue if his economic policy is enacted by American voters.

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2A The economic theory advocated by the author is not explicitly mentioned but the article suggests ... View the full answer