The rich get richer and the poor get poorer seems to be the proverb of the times, but just exactly how much richer did the rich get in the past 30 years?
According to a newly released report on real (inflation-adjusted) average household income in the United States by the non-partisan Congressional Budget Office, the answer is almost three times as rich:
For the 1 percent of the population with the highest income, average real after-tax household income grew by 275 percent between 1979 and 2007 (see Summary Figure 1).
The Top One-percenters also have the lionshare of the growth of total market income:
As a result of that uneven growth, the share of total market income received by the top 1 percent of the population more than doubled between 1979 and 2007, growing from about 10 percent to more than 20 percent. Without that growth at the top of the distribution, income inequality still would have increased, but not by nearly as much. The precise reasons for the rapid growth in income at the top are not well understood, though researchers have offered several potential rationales, including technical innovations that have changed the labor market for superstars (such as actors, athletes, and musicians), changes in the governance and structure of executive compensation, increases in firms’ size and complexity, and the increasing scale of financial-sector activities.
But is bemoaning the good fortunes of the super-rich the right thing to do? After all, the second part of the proverb "the poor get poorer" is actually incorrect: for the bottom 20% of the population, the average real after-tax household income increased by 18% over the past three decades. It seems like the poor also got a little bit richer.
Perhaps we should change the proverb to "the rich get richer and the poor get a little bit richer"?
Source: Trends in the Distribution of Household Income Between 1979 and 2007 [PDF] by the Congressional Budget Office - via The New York Times
The more they make(money) the lower its worth.
Products are sold in comparison to the Value of our money.
And where the Rich tended to get a cost of living increased based on the Value of THAT money..the poor DIDNT.
you should check out the Taxes Before 1970..when the Rich were taxed 70-90% and use that to compare.
http://www.reuters.com/article/2011/06/16/us-income-disparity-idUSTRE75F5VG20110616
Since only the more wealthy people can put some money aside, link it to that progression, et voila!
Moreover since that the wealthiest people are mostly getting their wealth from public companies...
Correlate the top 1% revenue and the dow jones and you'll have a pretty good picture of what's happening. I'd like to see the same data after 2008 as well, and that should reflect quite a drop.
Those data does not surprise me. It's math.
This fact is skillfully concealed and never publicized. If anyone doesn't believe me, go and get a 1040 form with all the applicable schedules (especially Schedule D) and work it out by plugging in the numbers. Keep trying higher capital gains, lower earned income. You'll find out the truth.
Yet another proof that supply-side economics does not work.
http://www.youtube.com/watch?v=JTzMqm2TwgE
Also, of course the poor are getting a little bit richer; the middle class are the only ones paying taxes! :P