Income Inequality in America

Posted by AzBlueMeanie:

Daily Kos has begun a new series on income inequality in America. Here are the highlights from the first post. The rich get richer…

The Nation's recent six-author collection on inequality in America provides a good beginning – only a beginning – for a comprehensive debate to and fro about inequality, and, most importantly, what to do about it. Happily, Garrett, a seven-year veteran at Daily Kos, has used the Reich piece to kick off a series on inequality on Thursday evenings.

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To begin, look at a few visuals from the report of the Center for Budget and Policy Priorities, Income Gaps Between Very Rich And Everyone Else More Than Tripled In Last Three Decades, New Data Show [pdf]:

Between 1979 and 2007, average after-tax incomes for the top 1 percent rose by 281 percent after adjusting for inflation — an increase in income of $973,100 per household — compared to increases of 25 percent ($11,200 per household) for the middle fifth of households and 16 percent ($2,400 per household) for the bottom fifth (see Figure 1).

If all groups’ after-tax incomes had grown at the same percentage rate over the 1979-2007 period, middle-income households would have received an additional $13,042 in 2007 and families in the bottom fifth would have received an additional $6,010.

In 2007, the average household in the top 1 percent had an income of $1.3 million, up $88,800 just from the prior year; this $88,800 gain is well above the total 2007 income of the average middle-income household ($55,300).

From the Bureau of Labor Statistics (via Business Insider):

But income is less than half the picture. What's more telling is wealth. Using the word that the right wing always speaks with horror when it applies to rank-and-file Americans, wealth has been heavily redistributed upward in the past 31 years.

That's where we are.

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Even if Baker's and Reich's and other of The Nation's authors are right about their competing prescriptions – all in all, quite modest prescriptions – there is not yet enough political will to transform them from wishes into reality.

The destruction of the middle class has not been the product of one party's machinations. One connived, the other – or rather a portion of it – acquiesced as it leaned ever more rightward. The current economic situation – the acute one in which corporate profits and cash hoarding stand side-by-side with intolerable odds for job seekers as well as the chronic one we see in these measures of inequality – didn't start yesterday. And neither of them can be instantly rolled back.