We had this Gilded Age up until the 1890s. The Progressive Era followed where most of the presidents during this time were Republicans. There are various similarities between the Gilded Age and today. Currently we have an eroded middle class, extreme wealth on the one end and people dealing with low wages and high costs on the other.
Extreme wealth usually results when entrepreneurs are really successful and they end up with a lot of stocks which have risen in value exponentially. Also, top corporate executives' pay has become, in general, grossly inflated. As for the former situation, the gains in wealth aren't taxable until the shares are sold. Service and retail workers need better wages and lower costs, so they can enjoy a more middle class-like lifestyle.
Tax policies can be used to equal-out the wealth gap. Costs, such as housing and medical, can be controlled so lower wage earners have a higher effective income. Labor laws need to be strengthened. Whereas high corporate salaries can be controlled, it is difficult to raise wages for those on the bottom. Corporations' savings in executive pay can be applied to lower earners, but it needs to be done the right way. Lower pay for top executives can lower operating costs, resulting in lower prices for goods and services, thereby benefiting lower wage earners.
Raising minimum wage doesn't always work. Sometimes, this results in lost jobs and shifts to automation. Union numbers have declined, and unions can be influential by controlling executive pay, as well as championing worker interests. Often in management-worker relations, there's an us vs. them mentality. Managers might just want to win through strategy, and unions can be too demanding. Management and workers need more teamwork.
Stock buybacks became legal in 1982, around the same time executive pay started growing fast. Buybacks are usually bad because there's a conflict of interest (stock is given to executives while being inflated through buybacks), possibly resulting in a bubble. Often times buybacks are leveraged, and the resources used for buybacks could go toward R+D, production or pay to workers. A lot of the pay packages for top executives is stock awards. Companies could buyback less stock to give to top earners and just pay the under-paid more.
