The stock market is too damn high!

I’m not talking about stocks being overvalued (though that too.) I’m talking about too many rich people, making too much money.

I’m only being slightly facetious.

Here's the thing folks, (as Joe Biden likes to say.) Super-affluent people in this country are accumulating wealth in massively disproportionate amounts—while the rest of us are falling further behind.

I know you’ve heard it before: Wealth inequality is bad, (blah blah blah) and the stock market’s going to the moon while the real economy is struggling (blah blah blah.)

Well you need to hold the blah blah for a second and listen up, because this is getting serious.

Truly.

Here’s a headline that says it all: “U.S. Billionaires Gained $1 Trillion Since The Pandemic Started,” (from $2.9 trillion on March 18 to $3.9 trillion on November 24, to be precise.) This, while millions of Americans lost their jobs and countless others struggle to find food, never mind the 14.2 million stricken by COVID-19 and the 276,000 dead.

Let’s dig into the super rich a bit more though, because what’s going on there really has become obscene.

Consider the 650 billionaires in the U.S. A recent study found that 29 of them have seen their wealth double since March. Another nugget: 47 individuals joined the list. This is during a pandemic, mind you! Here’s a spreadsheet with all manner of outrageousness. Like that Elon Musk’s net worth grew by more than $100 billion this year, and Jeff Bezos’ mushroomed by $70 billion and Dan Gilbert of Quicken Loans saw his fortune grow by some 575% to almost $44 billion.

And get this: The top 1% of Americans now hold $34.23 trillion of wealth, while the bottom 50% have $2.08 trillion, according to the Federal Reserve. In other words, the top 1% of the country has 16.5 times more money than the bottom half. Are you kidding me?

Isn’t it always that way, you ask? Actually no, not at all. In Q3 1989, (the furthest back the data goes) the wealthiest 1% had $4.81 trillion, while the lowest 50% had $.76 trillion—or only 6.3 times more. And as we’ve seen that ratio kept getting bigger.

Hey, I’m all for making money. It’s the American way. But this ladies and gentlemen is amoral, unsustainable and insane.

So, what can we do? Here are three questions to help frame an answer:

How can we get more people to share in wealth creation, i.e. to invest in the stock market for example?

What can the government do to address inequality? (Yes taxes, but what else?)

And finally, what can wealthy people do besides sitting on their hands and wait for higher taxes?

“The pandemic has exposed tremendous inequities in the United States by income, race, and geography,” says Darrell M. West, senior fellow at the Brookings Institution and author of “Billionaires: Reflections on the Upper Crust.” “So if we really want to get the economy growing, we have to have inclusive policies that help everybody, regardless of income.”

Let me take on this notion of getting more people to invest in the stock market first. Currently only 52.6% of American families have an investment in the market (and that includes 401(k)s). This point has been top of mind for former presidential candidate Andrew Yang who posted a short video on TikTok that went viral. He also spoke to Yahoo Finance about this:

“We're in the midst of the most extreme winner-take-all economy in the history of the world,” Yang says. “And it is getting a lot more extreme now, which is mind-boggling. The top 20% of Americans own 92% of stock market wealth. If you are the average American feeling left behind, it's not in your head, it's just in the numbers.”

Yang notes that we simply need to get more money into the hands of Americans, which he would accomplish through implementing a universal basic income program (UBI), where every citizen would receive a fixed amount of cash each month. (You can read all about this at Humanity Forward, the nonprofit Yang founded.)

Yang also proposes education efforts: “We should be teaching financial literacy at the high school level for all Americans. Many firms would love this. I mean, I talked to banks and accounting firms that want to do this.”

“There’s a real lack of financial knowledge and information, and it’s unevenly distributed across the country,” says Barbara A. Friedberg, a veteran investment portfolio manager and financial consultant. “Those people born into wealth have been informed about the benefits of investing in the public markets.The majority of the country knows nothing about it except seeing a clip of the S&P 500 on their feed and to them that’s like reading a statement in Greek.”

This gap falls along racial lines as well. “Black and brown people — the data is clear — we inherit much less than the few of us who have inheritances,” says John Rogers, founder and CEO of Ariel Capital Management, the nation’s oldest minority-run mutual fund firm. “They haven’t been passed down generation to generation; we don't spend a lot of time learning about it. Equally important or more importantly, because of historical discrimination in this country, we don’t have aunts, uncles, grandparents, and parents in a position to teach us about the stock market as we grow up to get comfortable with the logic of compound interest and investing in stocks over the long run as not a risky thing.”

The problem of growing wealth inequality isn’t lost on President-elect Biden. Once COVID-19 is in the rear view mirror, this could well become the defining issue of the Biden presidency. After all, wealth inequality is at the core of our now divided up nation. And this gets to my second question: What can the government do to address inequality?

In fact there has been an acknowledgement by some economists that historical methods of simply cutting interest rates to boost the economy, for instance, are now insufficient as that disproportionately benefits wealthy citizens, and not Americans most in need.

“The Fed is doing the best it can but its tool ultimately is a very blunt one,” says Eswar Prasad, an economist at Cornell University. “Even though credit appears a lot cheaper, in difficult economic times access to that credit becomes even more severely limited to those parts of the population and businesses that need it the most.”

The thinking is that new practices and tools are needed to address this shortcoming. Re-enter Janet Yellen—former Fed chair and Biden’s pick to be Treasury Secretary—who after being tapped by Biden, opened up a Twitter account and put this out as her very first Tweet.

Opinion columnist Owen Ullmann writing in USA Today notes that “what distinguishes [Yellen] most in the job is her empathy for the plight of the average working man and woman…”

In a 2014 speech in Boston when she was Fed chair, Yellen said, “The … continuing increase in inequality in the United States greatly concerns me. I think it is appropriate to ask whether this trend is compatible with values rooted in our nation’s history, among them the high value Americans have traditionally placed on equality of opportunity.”

Ullmann notes that Yellen will have an opportunity to do something about this problem as Treasury Secretary, whereas politically charged topics were “traditionally taboo for Fed chairs.” It will be most interesting to see what new methodologies Yellen looks to put into place.

As for higher taxes on wealthy Americans, I would bet they’re coming. (What do you think, can Elon afford to pay a bit more?) Here are some of Biden’s proposals, below are highlights:

-Increase taxes for those making more than $400,000, including raising the top rate back to 39.6%.

-Ask those making more than $1 million to pay the same rate on investment income that they do on their wages.

-Revamp 401(k)s to help lower wage earners.

-Increase the corporate tax rate to 28%.

-Mandate a true minimum tax on all foreign earnings of U.S. companies of 21%.

-Impose a tax penalty on corporations that ship jobs overseas.

-Impose a 15% minimum tax on corporations so all pay at least some tax.

You know as well as I do that some wealthy people will work night and day to fight all this. They’ll argue that sending more money to the federal government will just be money squandered. Or that they don’t truck with some government programs. And they will have a point I guess.

‘Inequitable distribution of opportunity’

Which brings me to my third question: What can wealthy people do besides sitting on their hands waiting to get taxed more?

I found one shining example being put into practice by Dave Roux, a former tech executive and entrepreneur, and co-founder and former co-CEO of Silver Lake Partners, the world’s largest technology-focused private equity firm.

(Full disclosure here, I’ve known Dave for a number of years though I shouldn’t think that would preclude him from doing something beneficial for society.)

To address the issue of inequality in America on a root cause level, Dave and his wife Barb have created and endowed the Roux Institute at Northeastern University, a graduate school in Portland, Maine, for students to pursue courses and degrees in digital engineering and modern life sciences.

The Roux Center is an experiment in a sense and it’s also a singular effort by a wealthy family taking on a systemic problem in our country by helping people get training for high-value jobs in a place where those jobs typically don’t exist.

“I think there is an immoral distribution of wealth in our country, which I believe stems fundamentally from an inequitable distribution of opportunity,” Roux told me. “That opportunity is very highly concentrated in just a handful of cities that have one or more great research universities. Talent is nothing more than ability, plus an education, plus a little motivation.”

The Institute ended up in Portland as Roux is from Maine but he notes “you could have put it in Spokane, or Fresno, or Central Florida, or a whole host of places which are nice, secondary tertiary cities, but currently lacking a world class educational institution.”

The Rouxs, who certainly are wealthy but not on any Forbes 500 Bloomberg rich list, put up $100 million (serious money) and have so far raised another $100 million from the Harold Alfond Foundation, the fortune from the old Dexter shoe company. (Interesting side note, the late Alfond sold Dexter to Berkshire Hathaway back in 1993 for $433 million in stock. In 2008 Warren Buffett called buying Dexter “the worst deal that I’ve made.” Warren can perhaps take comfort in knowing that Alfond has been putting that money to good use.)

There are currently 200-plus students enrolled at the Roux Institute in its first semester of operation, (COVID-19 of course has made launching the school that much more difficult), and Roux hopes to have up to 500 by next year and ultimately several thousand. Partnering with Northeastern (which Roux says has been “fantastic”) allows the Institute to piggyback on all of that University’s infrastructure.

The Roux Institute's curriculum is what is known as stackable, meaning you don't need to be in a degree program, you can simply sign up, take a course or a couple of courses and get a certificate or a credential, and those certificates and credentials can later be added up or stacked. Roux also has 31 strategic partners, two thirds of which are corporations (including Sun Life, Unum and L.L. Bean) on board to fund research projects, hire interns, and provide jobs.

There is a critical need, Roux says, to help jumpstart young people who have some baseline skills but aren’t connected to the right jobs. “About 25% of kids who graduate college today have a STEM degree,” Roux notes. “And almost none of them use it. They end up selling insurance or working at car dealerships, or whatever.”

What about tuition? Roux says coursework is “conventionally priced,” but that “we've got a very generous scholarship program for people that dramatically lowers the cost. And because we've got all these corporate partners, a lot of the people who are coming in this first wave actually have jobs and the tuition is being wholly or largely supported by corporations.”

Why is Roux focusing on STEM and not, say, the arts? It’s about economics, he says. “If you get the digital economy and modern life science right, which are the fundamental growth engines, then it almost doesn't matter what you do with all the other stuff, you'll be fine,” Roux says. “But if you get those two things wrong, you can't make up for it with restaurants, organic blueberries and yoga studios.”

I asked Dave if he knew of other people doing like-minded endeavors.

“I don't,” he said. “We’ve had a surprising number of phone calls from civic leaders and university presidents calling to say, could you explain this to me. I think people are watching very closely. And I think it'll only be a matter of time. My model is get this thing up and running, replicate other geographies that make sense, and where it's not possible for us, help somebody else duplicate. We could probably have 20 or 30 schools in the United States.”

The work Roux is doing isn’t easy, which comes with the territory when you’re blazing a trail. But projects like his Institute are the most rewarding. “All really big breakthroughs come from strange ideas,” he said. “I think there's lots of talented people out there. I'm flummoxed as to why they don't spend more of their time working on things that matter. Ultimately, that's the issue.”

After Bill and Melinda Gates, which billionaires are really trying to make a difference? While Musk and Bezos indulge in their billion-dollar space race, and others fund wings at the MOMA—peacocking, if you will—millions of Americans need better wages, or jobs, or just food. I don’t begrudge the charity-for-rich-people stuff, we certainly need art museums, just not at the expense of people who need help. And people need help now more than ever.

What if the richest people in America, did the same thing as Dave and Barb Roux are now doing in all 50 states? Create or support an endeavor that has its goal of improving the lives of their fellow citizens in need. Sort of a national adopt-a-state program.

Now there’s a strange idea.

Look at it this way, oh wealthy ones: You can do something with all your newfound billions on your own terms. Or the next federal government may do it for you.

Correction: An earlier version of this story incorrectly described Ariel Investments as the largest minority-owned mutual fund. The error has been corrected.

This article was featured in a Saturday edition of the Morning Brief on December 5, 2020. Get the Morning Brief sent directly to your inbox every Monday to Friday by 6:30 a.m. ET. Subscribe

Andy Serwer is editor-in-chief of Yahoo Finance. Follow him on Twitter: @serwer.

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