Income Inequality Is At An All-Time High: STUDY
According to a recently updated paper by University of California, Berkeley Professor Emmanuel Saez, income inequality in the United States is at an all-time high. On his blog, Nobel prize-winning economist and New York Times columnist Paul Krugman called the numbers "truly amazing."
Though income inequality has been growing for some time, the paper, which covers data through 2007, paints a stark, disturbing portrait of the extreme disparities in American wages. Saez calculates that in 2007 the top .001 percent of American earners took home 6 percent of total U.S. wages, a figure that has nearly doubled since 2000.
As of 2007, the top decile of American earners, Saez writes, pulled in a staggering 49.7 percent of total wages, a level that's "higher than any other year since 1917 and even surpasses 1928, the peak of stock market bubble in the 'roaring" 1920s.'"
Beginning in economic expansion of the early 1990s, Saez argues, the economy began to favor the top 1 percent of American earners, but much of the country missed was left behind. "The top 1 percent incomes captured half of the overall economic growth over the period 1993-2007," Saes writes.
Despite rising stock market, largely growing employment and a virtually unprecedented housing boom things were not nearly so rosy for the rest of U.S. workers. This trend, according to Saez, only accelerated during the George W. Bush's tenure as President:
"...while the bottom 99 percent of incomes grew at a solid pace of 2.7 percent per year from 1993-2000, these incomes grew only 1.3 percent per year from 2002-2007. As a result, in the economic expansion of 2002-2007, the top 1 percent captured two thirds of income growth."