The wealth divide is real. It’s wrong and it’s getting worse.

Support for socialism is on the rise. New York City has just elected a democratic socialist mayor - Zohran Mamdani. Senator Bernie Sanders and Representative Alexandria Ocasio-Cortez are long-term democratic socialist advocates.

Taking a Look at the Potential of Socialism

One of the core responsibilities of Congress is to control the national budget.

Congress has not passed an annual budget since 1997.  For almost 30 years, through both Democratic and Republican administrations and House and Senate majorities, Congress has relied instead on one continuing resolution after another as temporary budget stopgaps. Congress has not produced a budgetary surplus since 2001. In October of 2025, Congress caused the longest government shutdown in the history of the United States by failing to timely reach agreement on the next continuing resolution.

The economic management track record of Congress should be cause for hesitation when considering socialism as a solution to the wealth divide. That poor track record already includes a number of existing socialist programs - for instance, Social Security, Public Schools, Medicare and Medicaid, Supplemental Nutritional Assistance Program (SNAP) and Unemployment insurance. The existing socialist programs seem to be doing little to reverse the wealth divide. If Congress, controlled by either party, can’t adequately manage the federal budget or the existing socialist programs, is it prudent to expand their authority further giving them more reign over industry?

In addition to the financial powers Congress is Constitutionally authorized to control, Congress also has authority to regulate commerce. Shouldn’t the authority to regulate commerce give Congress the necessary resources to avoid a wealth divide? Will more authority granted under the adoption of an expanded socialist economic policy enable Congress to effectively reduce the wealth divide?

Reconsidering the History of Capitalism

American capitalism has historically funded American democracy making it the most powerful force for good in the world.

The same year that Thomas Jefferson drafted the Declaration of Independence, Adam Smith published An Inquiry into the Nature and Causes of the Wealth of Nations. In the retelling of American history, the story of the inherent economic revolution is eclipsed by the story of democratic government and individual liberty.  The economic and democratic stories are not mutually exclusive.  They are two aspects of the same story.  The United States did not establish the first democratic government in the world.  Greece did that thirteen centuries before the American Revolution.  The United States established the first democratic capitalist republic in the world. 

By 1800, less than twenty years after the end of the American Revolution, there were more private business corporations in the United States (population: four million) than in all of Europe combined (population: 150 million).  The important and heroic role of the revolutionary militiamen taking up arms has upstaged the even more vital and lasting economic contributions of those same militiamen taking up the reins of American commerce.

Social and Technological Progress has Exhausted the U.S. Democratic Capitalist System

250 years of social and technological progress has exhausted the capabilities of the U.S. democratic, capitalist system.  The founding principles are sound, but many of the thousands of agencies and departments, as well as the hundreds of thousands of rules, regulations, and laws that govern the system, are inevitably redundant, in conflict with one another, outdated, and out of touch.

A spring cleaning of agencies, departments, rules, regulations and laws is in order before We the People cede any more authority to a government that can’t execute with its current authority.

The Evolution of Capitalism and the Resulting Wealth Divide

Profit is the historic motivation behind capitalism. Profit is different from wealth. Profit is a means to wealth. At risk of sounding patronizing, a business sells a product or service at a price above the cost to develop and deliver that product or service and the difference between the price and the cost is profit.

Capitalism used to be balanced around profit. Business owners produced a competitive product for consumers and benefited from the profits of those sales. The wealth of business owners was tied to and limited by the amount of profit their businesses could generate.

Today, business owners can become billionaires long before their companies ever turn a profit. Some billionaires are made by companies that never turn a profit – For instance, WhatsApp, Flipkart, Airbnb, Reddit and Pinterest.  Stock ownership has replaced profit as capitalism’s priority.

Stock values over the last century have trended more and more toward reflecting an anticipated future financial performance of a company more than the company’s current book value. Over the past 30 years, the technology driven economy has dramatically increased that trend.

General Motors (GM) reported revenue of $187 billion in 2024 while Tesla reported $97 billion.  GM’s profit last year grew 21% to $15 billion. Tesla’s profit went down to $7 billion.  GM has an enterprise value of $215 billion.  Tesla’s enterprise value is $65 billion.  While market capitalization value based on share price is a moving target, Tesla’s market capitalization exceeds GM’s by at least factor of 10 and sometimes a factor of 20.

Fundamental financial performance metrics, like profit, have only a vague impact on share prices today which are otherwise alchemized through complicated projections of future value. Jeff Bezos and Elon Musk were billionaires long before Amazon or Tesla turned a profit.

The U.S. has the largest GDP in the world, and about seventy percent of it comes from consumer spending. Consumers—the citizens—are the most important asset in our capitalist economy. Consumers are the most important asset to every consumer company. Yet, with stock ownership replacing profit as the central measure of success, the benefits now flow disproportionately to shareholders.

Ninety-three percent of all stock is owned by the wealthiest ten percent of Americans. Most consumers don’t have the disposable income to buy stock.

Stock values are tied to consumer loyalty. What would Apple, Amazon, Visa, Walmart, and Exxon be without loyal consumers?  However, the average consumer does not have equal access – disposable income - to purchase stock in the companies that depend on their consumer loyalty.

The wealth divide is driven by inequitable access to stock ownership.

Updating the Capitalist System to Reverse the Wealth Divide

Consumer Equity Innovations (CEI) has developed a process called Consumer Equity, which is now patent-pending.  In short, Consumer Equity is designed to rebalance capitalism.

Just as the Labor Movement once updated capitalism to include workers in the rewards of production, a Consumer Equity movement can now update capitalism to include consumers in the value created through their own spending.

Consumer Equity is a monumental update that lets everyone invest in stocks through their everyday purchases.

Here’s how it works: every time a consumer makes a purchase, they earn a reward backed by a percentage of the company’s profit from that sale. For instance, when someone buys a mobile phone, a portion of the profit is set aside to back a Consumer Equity Reward. As they make additional purchases—accessories, repairs, upgrades—they earn more rewards. Eventually, those cash backed rewards can be converted into stock purchases on the consumer’s behalf.

Loyalty programs are everywhere today. American Airlines put them on the map in 1981 with its AAdvantage program, and now people earn rewards on everything from groceries to gas. Consumer Equity builds on that concept—but takes it much further.

It benefits both consumers and companies. Consumers who couldn’t previously afford to invest now can, simply by buying everyday essentials like rent or groceries. Companies, in turn, gain a vastly larger audience of potential investors. Instead of only the top 10% of Americans, 100% of the population can potentially purchase stock.