And Justice for Some: Just How Rich Are America's Richest?
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As the Occupy Wall Street protesters enter the third week of demonstrations, their call for increased wealth equality only grows louder. Like the protesters, many Americans are aware that the wealth gap in the United States is spiraling out of control, but few know the details of just how bad things have gotten. Here, coupled with images from Occupy Wall Street, we highlight some of the more shocking facts about America's dangerous and untenable monetary divide.
Photos via (cc) Flickr user david_shankbone
Back in March we told you that the 400 wealthiest Americans are now richer than the nation's bottom 50 percent. In the ensuing months, that divide has gotten worse: Forbes reported in September that the 400 richest Americans had become a full 12 percent wealthier. In 2007, Berkeley economist Emmanuel Saez calculated that the top .01 percent of people in the United States took home 6 percent of U.S. wages. And the top 10 percent of earners, Saez wrote, earned more "than any other year since 1917 and even surpasses 1928, the peak of stock market bubble in the 'roaring' 1920s."
Though the Great Recession has hit most every American, it's been far kinder to the ultra-rich than it has the average person. According to Bard College economist Edward Wolff, while the median household wealth has fallen by more than 36 percent since 2007, the top 1 percent of households lost only about 11 percent of their wealth.
University of California at Santa Cruz sociologist G. William Domhoff writes, "In terms of types of financial wealth, the top one percent of households have 38.3 percent of all privately held stock, 60.6 percent of financial securities, and 62.4 percent of business equity." While that's a lot, it's nothing compared to how much the top decile owns: more than 80 percent of stocks, bonds, trust funds, and business equity, and more than 75 percent of non-home real estate.
In 1972, median earnings for a full-time male worker were $47,550 dollars annually (inflation adjusted). Today that number is $47,715, or a difference of $165. But while the middle class struggles with flat wages, the rich have flourished. Consider this: In 1970, CEOs earned $25 for ever $1 the average worker earned. Just 30 years later, CEOs were earning $90 for ever $1 paid to workers.
Though the common Tea Party refrain says we're being taxed too much, the fact is that America's current tax burden isn't nearly as large as it's been in the past, under both Democratic and Republican administrations. The rich have it particularly easy. Under the GOP's beloved President Reagan, the top marginal income tax was 50 percent for half a decade. That's far more than the current 35 percent, and more than 10 percent higher than the rate would be if the Bush tax cuts were allowed to expire.
Thanks to the fact that they're earning more money, enjoying low taxes, and benefiting from investments, the rich have amassed tremendous fortunes that will be passed through their families for generations. The richest 1 percent in America now own 40 percent of all the wealth, and that number is only getting larger.