Musk's trillionaire status highlights US inequality's persistence, analyst says

In an analysis published Sunday, Eduardo Porter, a journalist focused on economics and politics, argued that Elon Musk’s ascent to trillionaire status after SpaceX’s initial public offering epitomizes the United States’ inability to curb rising income inequality. Porter’s essay, published by The Guardian, traces decades of redistributive policy and finds that even the most ambitious efforts have produced only modest and temporary effects.

Porter wrote that as Barack Obama’s presidency neared its end, then-chairman of the Council of Economic Advisers Jason Furman touted the administration’s anti-inequality measures as “the largest investments in reducing inequality since the Great Society.” By the end of 2016, Porter reported, taxes and transfers cut the share of income accruing to the richest 1% of households by just over a fifth, according to Congressional Budget Office estimates — more than under any administration since Jimmy Carter. The policies raised the share of income going to the poorest fifth from 3.9% to 7.9%, the highest level since at least 1979.

That moment, Porter said, now appears as a brief high-water mark. After Trump took office, his 2017 Tax Cuts and Jobs Act provided large tax cuts to upper-income Americans. By the end of Trump’s first term, the share of income flowing to the richest 1% after taxes and transfers had drifted back up to 13.2%, from 12.5% when Obama left office.

During the COVID-19 pandemic, the $2.2 trillion CARES Act temporarily improved conditions for the poor: the share of national income going to the poorest fifth reached a multi-decade high of 8.2% in 2020. But by 2022, under President Joe Biden, Porter noted that share had dipped to 7.4%.

Porter argued that redistribution is not a priority for Trump, pointing to the One Big Beautiful Bill Act of 2025. According to CBO estimates cited by Porter, that legislation reduced the average annual income of the poorest tenth of households by about $1,200, a decrease of about 3.1%, while boosting the income of households in the top decile by about $13,600, an increase of about 2.6%. Porter added that tariffs imposed under Trump took a disproportionately large bite from working-class disposable income.

Despite the policy swings between parties, Porter wrote that “the United States’s deep inequality — and its general disinterest in doing anything about it — is hardly Trump’s fault.” He described the lopsided distribution of prosperity as a structural feature embedded in Americans’ long-standing dislike of taxation, especially at the highest levels.

Porter cited research by economists at the University of California, Berkeley estimating that the 400 richest Americans pay a smaller share of their income in taxes than the average citizen, largely because of the many ways wealthy individuals can structure their finances to minimize tax bills. The Gini index, a common measure of inequality, shows the United States among the highest in the OECD, and taxes and transfers have done less to reduce inequality in the U.S. than in nearly every other OECD country.

The analysis turned specifically to Musk’s financial practices. Porter referenced a ProPublica investigation that documented that Musk’s wealth rose by $13.9 billion between 2014 and 2018, but he reported income of only $1.52 billion and paid $455 million in taxes. In 2015, according to ProPublica, Musk paid $68,000 in federal income tax; in 2017, he paid $65,000; and in 2018, he paid none.

Porter described a broader pattern among technology billionaires — Steve Jobs, Mark Zuckerberg, Larry Ellison, Larry Page — who take nominal salaries and draw their wealth from appreciating stock, paying capital gains taxes only when they sell and often financing their lifestyles with loans secured by shares. Unrealized capital gains, he noted, account for 55% of the largest estates and are bequeathed tax-free.

“Will redistribution be up to the task of helping ordinary Americans cope with such an unequal economic landscape?” Porter asked. He concluded that Obama’s efforts, “the most strenuous since Lyndon Johnson’s Great Society, look today like minor blips in the long arch of American indifference toward its massive disparities.”