We Are Witnessing the Rise of a New Aristocracy

Start with economic growth itself. When inequality gets extreme enough, it starts to exact a cost on the whole system. Economists have shown that if the income share of the top 20 percent rises, growth in the gross domestic product actually declines over the medium term. That’s partly because lower- and middle-income households, which spend a far higher share of their earnings than wealthier ones do, have less money to put back into the economy. It’s also because inequality tends to make the most valuable skills more expensive and harder to access. (Think of the price of a house in a top-rated school district.)

This brings me to the fact that growing inequality worsens the affordability crisis. In 2025, for the first time since data collection on the statistic began regularly in 1989, the top 10 percent of earnings supplied nearly half of consumer spending, and those earners’ expensive tastes are already warping markets for essentials, from housing and health care to cars.

Read the full story in The New York Times.