The conversation about inequality in America has increasingly centered on a distinction that was, until relatively recently, obscured by the broader category of "the rich": the difference between the merely affluent — doctors, lawyers, professors, successful small business owners — and the genuinely wealthy, the top fraction of the top percent whose share of total income and wealth has grown to levels not seen since the 1920s.

The 1 percent, as shorthand, became the central frame for the Occupy Wall Street movement in 2011 and remained a fixture of political discourse through the 2012 election. But critics of that framing argued that it was both too broad and too narrow — too broad in that it lumped together people with meaningfully different levels of economic power, and too narrow in that it focused on income distribution while leaving aside the more profound question of how wealth concentration translates into political power.

The more precise concern, articulated by economists like Joseph Stiglitz and journalists like Timothy Noah, was what might be called the 0.1 percent problem: a relatively small group of individuals whose accumulation of capital was of a different order than even other high earners, and whose capacity to shape regulatory environments, influence political campaigns, and extract economic rents gave them influence over the structures of the economy itself.

This distinction matters because the policy responses are different. Tax policy that affects all households above $250,000 in income is addressing a different problem than tax policy specifically targeting carried interest, inherited wealth, or the capital gains treatment that benefits primarily those with very large asset portfolios.

The elite 1 percent problem is, in the end, not fundamentally about envy or resentment. It is about whether democratic governance can function when economic power is sufficiently concentrated that those who hold it can effectively purchase the rules they prefer.