A Return To The Roaring Twenties

This information from USA Today surprises virtually nobody:

Top 1% take biggest income slice on record

The gulf between the richest 1% of the USA and the rest of the country got to its widest level in history last year.

The top 1% of earners in the U.S. pulled in 19.3% of total household income in 2012, which is their biggest slice of total income in more than 100 years, according to a an analysis by economists at the University of California, Berkeley and the Paris School of Economics at Oxford University.

The richest Americans haven’t claimed this large of a slice of total wealth since 1927, when the group claimed 18.7%. The analysis is based on data from Internal Revenue Service data.

One of the economists behind the research, Emmanuel Saez of the University of California, Berkeley, is a top researcher in the topic of wealth and income inequality. He won the John Bates Clark medal last year. The Clark medal is awarded to the most promising economists under the age of 40. Past winners have includes Paul Krugman of Princeton University, Lawrence Summers and Steve Levitt, co-author of “Freakonomics.”

In a separate analysis, Saez found the top 1% of earnings posted 86% real income growth between 1993 and 2000. Meanwhile, the real income growth of the bottom 99% of earnings rose 6.6%.

The United States is a center-right country regarding economic matters and Americans typically do not object a sizable portion of wealth being in the hands of a minority. The problem is when such record disparity leads to economic stagnation, along with the other problems seen after we had a similar situation in the 1930’s. I doubt that many people buy the conservative/libertarian economic argument that the top one percent is richer due to working harder and deserving more. There is a growing realization that the rules are rigged in favor of the ultra-wealthy. Ed Kilgore sums it up:

So the economic “recovery” we are in is for most Americans at best a return to the stagnant real wages and treading-water living standards of the 2000s, along with a decline in wealth and in economic insecurity, not to mention a continuing calamity for the long-term unemployed. But for all the endless and incessant and redundant whining from the political representatives of the wealthy about “class warfare” and “socialism” and the impending extinction of “makers” by “takers,” the rich are “recovering” just fine. Lord, they might even somehow survive the implementation of Obamacare.

Perhaps this is why Bill de Blasio came in first place in the New York Democratic primary. (It is still not clear if he received enough votes to avoid a run-off).

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