Low taxes on the wealthiest segment of society is the underlying cause of wealth disparity.

Previously we demonstrated low tax rates on the wealthiest segment of society encourages hoarding among the wealthiest segment; this is accomplished by underpaying the workforce, and shifting long-term responsibilities onto that underpaid workforce. Low taxes encourage employers to hoard profits.

Employees were once given annual incomes that could support a middle-class family. Today, both husband and wife must work to maintain a similar lifestyle that their one-income parents enjoyed. The profits that once paid for better wages, retirement plans, and healthcare now go into the pockets of upper-management. This shift of profits from those that produced the profits to those that merely management the producers of profits took place because low-taxation encourages greed. High taxation creates a wealth distribution equilibrium by acting as a disincentive to hoard wealth among a few corporate leaders.

Lowering incomes, and shifting ever-greater financial responsibility onto those lowering incomes, means consumers must rely upon credit because they are unable to save enough sufficiently. The last generation was able to save for several months to purchase a required durable good, such as – a refrigerator, oven, etc. The modern family, however, if they are funding their 401k and paying for their family's healthcare, would have to save for several years to purchase durable goods.

The modern family must use credit to purchase durable goods. But, the 401k contribution, the cost of healthcare, and credit payments on durable goods, take so much of the family income, minor purchases must now be made with credit too. This forces the family to maintain a delicate balance between using credit to fund family expenses and paying down the credit. This delicate balance is disrupted when abusive employers lay employees off or terminate their employment.