Income Gaps Between Very Rich and Everyone Else More Than Tripled In Last Three Decades

[swag]

This massive transfer of wealth from the (once) middle class to the ultra-rich is possibly the largest legacy of the Reagan revolution.

http://www.cbpp.org/cms/?fa=view&id=3220&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+cbpp%2FfYJq+%28Center+on+Budget+and+Policy+Priorities%29



. . .

The CBO figures show that the nation’s income has grown substantially since 1979; if this growth had been shared more broadly, most groups would have seen much larger gains. For the nation as a whole, after-tax household income increased 55 percent from 1979 to 2007, adjusted for inflation. If all groups’ incomes had grown by 55 percent, the average income of the bottom fifth of households would have been $23,710 in 2007 (rather than $17,700) and the average income of the middle fifth would have been $68,342 (rather than $55,300).

Instead, the wealthiest households reaped a sharply growing share of the nation’s income, while the share going to middle- and lower-income households shrank (see Figure 3). Between 1979 and 2007:

■The top 1 percent’s share of the nation’s total after-tax household income more than doubled, from 7.5 percent to 17.1 percent.
■The share of income going to the middle three-fifths (or 60 percent) of households shrank from 51.1 percent to 43.5 percent.

. . . much more at the link

[ladjf]

1. The primary symptom that facism is taking over. nt

[SunnySong]

2. Thank God it passed....nt

[aquart]

3. No one should be so rich he has nothing left to buy but his government.

[Phoebe Loosinhouse]

4. 3 Decades?! How about just taking a look from 02-07?

Couldn't have anything to do with Crony capitalism, rigged stock markets, too big to fail financial policies, and wars for profit could it?

[swag]

6. And Bush tax cuts as the authors mentioned.

[jgraz]

9. In fairness, it really started taking off under Clinton

Rising tide lifts all boats MY ASS.

[Cresent City Kid]

18. It did take off under Clinton

I'm on the bottom line which went south under Reagan and up under Clinton. Both moves were small, but at this level, small changes are significant. I'm not arguing that things were perfect under
Clinton, saying back off of Clinton or anything like that. The policies are similar, but the small differences seemed to stand out to me personally. These gains were hardly an end goal, just a little breathing room. The larger picture in which the top is bleeding every other class dry has to be addressed.

I think we are in agreement about the skewed nature of the system. When someone tells me a rising tide lifts all boats, I point out that most of us are tied to the dock.

[Seneca]

20. True, but!

Clinton restored the pre-Reagan tax bracket for the upper 5%, and the chart proves that tax increases do NOT hurt the rich. The tech bubble fueled a lot of that growth, and the tax increases/budget cuts DID help the budget get balanced, eventually with a surplus - despite all the hand-wringing from the right-wing that it would hurt America, usher in socialism, etc. In fact, they used Clinton's repeal of the Reagan tax cuts on the wealthy to rally the fascist heartland to vote the Repukes back in for '94. They are doing it again now.

I would also like to mention that under Clinton, it was the first time since 1974 that incomes kept pace with, or outperformed inflation, for a few years in the mid-90's anyway. Since then, we've been back to eroding incomes and the enormous deficits of the pre-Clinton years. If his tax brackets had been kept intact, that red line would not have gone up so steeply after '01.

That isn't to say that Clinton was great or perfect. Far, far, from it. But I won't blame him for the widening gap between the rich and poor, when you take into account the reversal of the '74-onward trend, and for a brief time, the reversal of middle-class shrinkage. The budget and framework he set in motion, courtesy of Gore's tie-breaking Senate vote, was string enough to fend off some of the worst challenges brought by the Repuke congress.

I know NAFTA and welfare reform are boogeymen for the anti-Clintonites on here, so I expect any rebuttal will bitch and moan about them (I don't care for NAFTA myself, but the welfare reform wasn't as harsh as its detractors like to insist. I see its detractors as conservatives, for they defended the status quo - which was no longer viable. Sometimes, being a reactionary isn't always a province of the right-wing. Plus, the 5 year limit has sufficient loopholes, and the job training aspects were long overdue, even if imperfect).

[karynnj]

19. You could do that, but it is more complete and honest to

not ignore that the two periods where the very rich income sky rocketed were in the 1990s and in the period after 2004. (look at the places where the slope of the top curve is extremely steep.

I would suggest that the one after 2004 was fueled by allowing leverage at the top banks go from about 12:1 to 44:1 - with accelerated the the housing/derivatives bubble. The earlier one was likely the tech and dot com bubble, where the biggest winners were those connected enough to get in early on various stocks.

The fact is that if you look at the space between the curves, you really can't ignore the Clinton years. Looking at this curve, it is interesting when you think of the Mario Coumo speech in 1984, which eloquently spook of the two Americas. http://www.americanrhetoric.com/speeches/mariocuomo1984dnc.htm (Worth listening too because it is an incredible speech for those too young to have heard it.)

Ignoring the Clinton years is not just intellectually questionable, it leads to Republicans immediately being able to claim that the gap increased at a greater rate then. One defense that can be made of the Clinton years versus the Bush ones - is that even the bottom fifth line has a positive slope, in the first several Bush years, they have a negative slope - their income actually went down.

[fascisthunter]

5. yet they whine for more

how dare americans have unions and demand life sustaining jobs from the greedy who abuse workers and keep all the money to themselves.... :sarcasm:




"Taxes!!!! Whu-aaaaaaaaah!"

[Phoebe Loosinhouse]

8. How dare they see their taxes provide for the general health and well-being

of the populace? How dare a dime of it goes to healthcare or education or Social Security?

[Glenda]

13. Thanks for posting that table

What would you say is the Middle Class? The 2nd, 3rd, & 4th Fifth?

[HillbillyBob]

7. Some of us have seen

75% drop in income since the outsourcing started to really crank up in the 90s.

[xchrom]

10. Recommend

[varelse]

11. K&R

This is the problem - how do we solve it?

[DJ13]

12. Are those raw numbers, or adjusted for inflation?

Im asking because other studies I've read show that after adjustment for inflation the average american has seen a decline in wages since the late 70's.

Which would actually be worse than that chart shows.

[jwirr]

14. And the rich are still bitching because they do not have enough money! nt

[moondust]

16. Way too much isn't nearly enough.

The more you have the more you crave?

[branders seine]

15. It's a brand new world!!

Ain't it wonderful?

We're getting so much done FOR YOU!

Love,
The DLC, New Whatevers

[OHdem10]

17. The Free Market System is designed to make this happen.

Unfettered(Deregulated) Capitalism is a competitive system.
Therefore there are winners and losers. The rich are "out of
the gate first" with their means. Guess who the losers are.


Deregulation has meant literally, each and every corporation
or business policed themselves. Little to no government
oversight. Business friendly attitudes pushed from the top
to regulators who interpreted this to mean --look the other
way.

During the Reagan ADM. many rules of the road changed.
Corporations have responsibility only to their shareholders.
This meant they were absolved and just about any and all
responsibility to their workers. Their job was to make
money for their shareholders. If gradually lowering salaries,
meant more money to shareholder so be it. If outsourcing
factories and and jobs to countries for cheap labor, so
be it. Shareholders are the Rich --they were at an advantage
and it just got better. The Working Class got the shaft
and polls show they have little if any ground over the
same decades. What can anyone expect under this system.

This is not an anti-capitalism post. Capitalism is simply
an economic system which can be used for good or evil.
Deregulated capitalism is the problem (if you are concerned
about the Middle Class. That evil FDR (my Hero) taught
us this way back when. The GOP has done everything in their
power to drive a stake through the heart of anything FDR.
Sadly, some in our own party drank the GOP Kool Aid.

FREE MARKET CONSERVATIVE ECONOMICS will continue the
wealth gap between Rich, Working Class and Poor.

[tomp]

21. we're dealing with sociopaths.

the top 1% and 95% of politicians.

[Octafish]

22. + 299,990,000

Lobbyists today not only make the laws,
they make the politicians.

[fascisthunter]

23. +++++++++

and the idiots keep rewarding them, slaves to the scraps the sociopaths send them from their tables.

[entanglement]

24. Of course the top 1% worked for their own benefit, but what of their collaborators,

the (mostly upper middle-class) people comprising the next 40 percent or so, who were only too happy to let them get away with it as long as they got a share of the spoils and the "underclass" was suppressed?

[90-percent]

25. Ahhh, the collaborators

I recall in the early eighties, as the American rust belt manufacturing operations all started to go offshore. All us white collar types were saying; "How bad, too sad. Time for all you dumb factory workers that are content to earn a living doing monotonous intellectually undemanding type work will now have to go get yourself retrained and get a nice white collar job doing real work with your mind."

A wee bit of schadenfreude on my part to see all the white collar people of the last 10 or 15 years loose their 6 figure jobs to outsourcing. I bet there's a lot of former computer programmers out there cutting laws these days!

I do have a good friend that was laid off at Sun Microsystems that managed to get himself another 6 figure good job in about 2 months. Good for him. Nice to know there's still the so called good jobs still out there!

I'm in Connecticut and I think this state has been much less affected by the current recession than so many other areas of the country. We still have a business as usual vibe around here, near as I can tell?

-90% Jimmy