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Income Inequality News Articles
Excerpts of Key Income Inequality News Articles in Media


Below are highly revealing excerpts of important income inequality news articles from the major media suggesting a cover-up. Links are provided to the full news articles for verification. If any link fails to function, read this webpage. These income inequality news articles are listed by order of importance. You can also explore the articles listed by order of the date of the news article or by the date posted. By choosing to educate ourselves and to spread the word, we can and will build a brighter future.

Note: Explore our full index to revealing excerpts of key major media news articles on dozens of engaging topics. And read excerpts from 20 of the most revealing news articles ever published.


World's Richest People Meet, Muse On How To Spread The Wealth
2014-05-27, NPR blog
http://www.npr.org/blogs/parallels/2014/05/27/316317191/worlds-richest-people...

Talk of economic mobility and the wealth gap is hardly new. From the Occupy movement to President Obama's re-election campaign, income inequality has been in the spotlight for years. Even so, the "inclusive capitalism" conference in London ... broke new ground. Not because of the conversation, but because of the people having it. The 250 people from around the world invited to attend this one-day conference do not represent "the 99 percent," or even the 1 percent. It's more like a tiny fraction of the 1 percent. "We have $30 trillion of assets under management in the room," says conference organizer Lynn Forester de Rothschild, who runs E. L. Rothschild, a major investment firm she and her husband, of the storied Rothschild banking family. That amount — $30 trillion — is roughly one-third of the total investable wealth in the world. "If this bulk of capital decides that they are going to invest in companies that aren't only thinking about the short-term profit," says Rothschild, "then we will see corporate behavior change." The titans of commerce and finance didn't necessarily fly to this meeting in London out of a sense of ethics or moral duty, though that may be a motivation for some. For many, says Rothschild, it's a sense of self-preservation. Capitalism appears to be under siege. "It's true that the business of business is not to solve society's problems," she says. "But it is really dangerous for business when business is viewed as one of society's problems. And that is where we are today."

Note: For more on this, see concise summaries of deeply revealing income inequality news articles from reliable major media sources.


California tax plan could rein in CEO pay
2014-05-02, San Francisco Chronicle (SF's leading newspaper)
http://www.sfgate.com/opinion/reich/article/California-tax-plan-could-rein-in...

Until the 1980s, corporate CEOs in America were paid, on average, 30 times what their typical worker was paid. Since then, CEO pay has skyrocketed to 280 times the pay of a typical worker; in big companies, to 354 times. Meanwhile, over the same 30-year span, the median American worker has seen no pay increase at all, adjusted for inflation. Even though the pay of male workers continues to outpace that of females, the typical male worker between the ages of 25 and 44 peaked in 1973 and his pay has been dropping ever since. Wages of the median male worker across all age brackets have dropped 10 percent, after inflation, since 2000. CEOs and other top executives use their fortunes to fuel speculative booms followed by busts. CEOs and top corporate executives in Europe, Canada and Japan don't get paid vast multiples of what their employees earn. At the same time, their workers are starting to command better pay than the typical American. The median wage in Canada is already higher than the median wage in the United States. There's no easy answer for reversing this trend, but ... a bill introduced in the California Legislature ... creates the right incentives. The proposed legislation sets corporate taxes according to the ratio of CEO pay to the pay of the company's typical worker. Corporations with low pay ratios get a tax break. Those with high ratios get a tax increase. For the last 30 years, almost all the incentives for companies have been to lower the pay of their workers while increasing the pay of their CEOs and other top executives. It's about time some incentives were applied in the other direction.

Note: For more on income inequality, see the deeply revealing reports from reliable major media sources available here.


The American Middle Class Is No Longer the World’s Richest
2014-04-23, New York Times
http://www.nytimes.com/2014/04/23/upshot/the-american-middle-class-is-no-long...

The American middle class, long the most affluent in the world, has lost that distinction. While the wealthiest Americans are outpacing many of their global peers, a New York Times analysis shows that across the lower- and middle-income tiers, citizens of other advanced countries have received considerably larger raises over the last three decades. After-tax middle-class incomes in Canada — substantially behind in 2000 — now appear to be higher than in the United States. The poor in much of Europe earn more than poor Americans. The numbers ... suggest that most American families are paying a steep price for high and rising income inequality. The struggles of the poor in the United States are even starker than those of the middle class. A family at the 20th percentile of the income distribution in this country makes significantly less money than a similar family in Canada, Sweden, Norway, Finland or the Netherlands. Thirty-five years ago, the reverse was true. The findings are striking because the most commonly cited economic statistics — such as per capita gross domestic product — continue to show that the United States has maintained its lead as the world’s richest large country. But those numbers are averages, which do not capture the distribution of income. With a big share of recent income gains in this country flowing to a relatively small slice of high-earning households, most Americans are not keeping pace with their counterparts around the world.

Note: For more on income inequality, see the deeply revealing reports from reliable major media sources available here.


Study: US is an oligarchy, not a democracy
2014-04-17, BBC News
http://www.bbc.com/news/blogs-echochambers-27074746

The US is dominated by a rich and powerful elite. So concludes a recent study by Princeton University Prof Martin Gilens and Northwestern University Prof Benjamin I Page. Multivariate analysis indicates that economic elites and organised groups representing business interests have substantial independent impacts on US government policy, while average citizens and mass-based interest groups have little or no independent influence. In English: the wealthy few move policy, while the average American has little power. The two professors came to this conclusion after reviewing answers to 1,779 survey questions asked between 1981 and 2002 on public policy issues. They broke the responses down by income level, and then determined how often certain income levels and organised interest groups saw their policy preferences enacted. "A proposed policy change with low support among economically elite Americans (one-out-of-five in favour) is adopted only about 18% of the time," they write, "while a proposed change with high support (four-out-of-five in favour) is adopted about 45% of the time." When a majority of citizens disagrees with economic elites and/or with organised interests, they generally lose. Moreover, because of the strong status quo bias built into the US political system, even when fairly large majorities of Americans favour policy change, they generally do not get it. They conclude: "We believe that if policymaking is dominated by powerful business organisations and a small number of affluent Americans, then America's claims to being a democratic society are seriously threatened."

Note: For more on the antidemocratic impacts of income inequality, see the deeply revealing reports from reliable major media sources available here.


The 67 People As Wealthy As The World's Poorest 3.5 Billion
2014-03-25, Forbes
http://www.forbes.com/sites/forbesinsights/2014/03/25/the-67-people-as-wealth...

Oxfam International, a poverty fighting organization, made news at the World Economic Forum in Davos earlier this year with its report that the world’s 85 richest people own assets with the same value as those owned by the poorer half of the world’s population, or 3.5 billion people (including children). Both groups have $US 1.7 trillion. That’s $20 billion on average if you are in the first group, and $486 if you are in the second group. By the time Forbes published its 2014 Billionaires List in early March, it took only 67 of the richest peoples’ wealth to match the poorer half of the world. Each of the 67 is on average worth the same as 52 million people from the bottom of the world’s wealth pyramid. Bill Gates, the world’s richest man, with a net worth of $76 billion, is worth the same as 156 million people from the bottom. Who are the 67? The biggest group—28 billionaires, or 42% of them—is from the United States. No other country comes close. Germany and Russia have the second-highest number, with six each. The rest are sprinkled among 13 countries in Western Europe, APAC and the Americas. That the biggest group of the super rich comes from the U.S. should not be a surprise, as the country holds almost a third of the world’s wealth (30%), significantly more than any other country, according to the Global Wealth Databook, from Credit Suisse Research Institute.

Note: For more on income and wealth inequality, see the deeply revealing reports from reliable major media sources available here.


Money made at others’ expense
2014-01-28, Washington Post
http://www.washingtonpost.com/opinions/harold-meyerson-money-made-at-others-e...

The paths that many of today’s wealthiest Americans have taken on their road to riches have not bettered most people’s lives. Many have actually hurt most people’s lives. Their riches have come at most other people’s expense. Since the recession officially ended in June 2009, for instance, the wages for all private-sector jobs have fallen, on average, by 0.5 percent. The wages for jobs in financial services, however, have risen by 5.5 percent. Inasmuch as the recession was brought about by the financial services industry, it’s understandable that this disparity would strike most people as unjust. Or consider the mechanisms by which some CEOs earn huge salaries. Last week, the board of directors of JPMorgan Chase voted to raise chief executive Jamie Dimon’s annual pay to $20 million — up from $11.5 million — despite the fact that the bank paid the federal government around $20 billion last year to settle charges stemming from its multiple misdeeds. Laying off workers and depressing their pay has become the key factor in boosting corporate profits in recent years. With profits at a record high as a share of the nation’s gross domestic product and wages at a record low, it’s entirely proper that Americans question the legitimacy of the 1 percent’s wealth.

Note: For more on income inequality, see the deeply revealing reports from reliable major media sources available here.


The Great Redistribution a windfall for rich
2014-01-10, San Francisco Chronicle (SF's leading newspaper)
http://www.sfgate.com/opinion/reich/article/The-Great-Redistribution-a-windfa...

2013 marked one of the biggest redistributions in recent American history - a redistribution upward, from average working people to the owners of America. The stock market ended 2013 at an all-time high, giving stockholders their biggest annual gain in almost two decades. Most Americans didn't share in those gains, however, because most people haven't been able to save enough to invest in the stock market. More than two-thirds of Americans live from paycheck to paycheck. Even if you include the value of individual retirement accounts, most shares of stock are owned by the very wealthy. The richest 1 percent of Americans owns 35 percent of the value of American-owned shares. The richest 10 percent owns more than 80 percent. So in the bull market of 2013, America's rich hit the jackpot. Stock prices track corporate profits. And 2013 was a banner year for profits. Where did those profits come from? Here's where redistribution comes in. American corporations didn't make most of their money from increased sales (although their foreign sales did increase). They made their big bucks mostly by reducing their costs - especially their biggest single cost: wages. They push wages down because most workers no longer have any bargaining power when it comes to determining pay. The continuing high rate of unemployment - including a record number of long-term jobless and a large number who have given up looking for work altogether - has allowed employers to set the terms.

Note: For more on income inequality, see the deeply revealing reports from reliable major media sources available here.


50 years later, war on poverty is a mixed bag
2014-01-05, New York Times
http://www.nytimes.com/2014/01/05/business/50-years-later-war-on-poverty-is-a...

To many Americans, the war on poverty declared 50 years ago by President Lyndon B. Johnson has largely failed. The poverty rate has fallen only to 15 percent from 19 percent in two generations, and 46 million Americans live in households where the government considers their income scarcely adequate. Half a century after Mr. Johnson’s now-famed State of the Union address, the debate over the government’s role in creating opportunity and ending deprivation has flared anew, with inequality as acute as it was in the Roaring Twenties and the ranks of the poor and near-poor at record highs. High rates of poverty ... have remained a remarkably persistent feature of American society. About four in 10 black children live in poverty; for Hispanic children, that figure is about three in 10. According to one recent study, as of mid-2011, in any given month, 1.7 million households were living on cash income of less than $2 a person a day, with the prevalence of the kind of deep poverty commonly associated with developing nations increasing since the mid-1990s. The 1996 Clinton-era welfare overhaul drastically cut the cash assistance available to needy families, often ones headed by single mothers. Over the last 30 years, growth has generally failed to translate into income gains for workers — even as the American labor force has become better educated and more skilled.

Note: For more on income inequality, see the deeply revealing reports from reliable major media sources available here.


Poverty wages in the land of plenty
2013-12-05, The Guardian (One of the UK's leading newspapers)
http://www.theguardian.com/commentisfree/2013/dec/05/campaign-to-raise-minimu...

The holiday season is upon us. Sadly, the big retailers are Scrooges when it comes to paying their workers. Undergirding the sale prices is an army of workers earning the minimum wage or a fraction above it, living check to check on their meager pay and benefits. The dark secret that the retail giants like Walmart don't want you to know is that many of these workers subsist below the poverty line, and rely on programs like food stamps and Medicaid just to get by. This holiday season, though, low-wage workers from Walmart to fast-food restaurants are standing up and fighting back. Wal-Mart is the world's largest retailer, with 2.2 million employees, 1.3 million of whom are in the US. It reported close to $120bn in gross profit for 2012. Just six members of the Walton family, whose patriarch, Sam Walton, founded the retail giant, have amassed an estimated combined fortune of between $115bn to $144bn. These six individuals have more wealth than the combined financial assets of the poorest 40% of the US population. Walmart workers have been organizing under the banner of OUR Walmart, a worker initiative supported by the United Food and Commercial Workers union. Workers have taken courageous stands, protesting their employer and engaging in short-term strikes. Walmart has retaliated, firing many who participated. Parallel to the Walmart campaign is a drive for higher wages in the fast-food industry. In more than 100 cities, workers are organizing protests and strikes ... and winning.

Note: For more on income inequality, see the deeply revealing reports from reliable major media sources available here.


The Pope’s bold new vision
2013-11-26, CNN blog
http://religion.blogs.cnn.com/2013/11/26/the-popes-bold-new-vision/

Pope Francis on [November 26] issued a bold new document – in Vatican parlance an “apostolic exhortation” – called Evangelii Gaudium or “The Joy of the Gospel.” In this document, he sets out an exciting new vision of how to be a church. It is to be a joyful community of believers completely unafraid of the modern world, completely unafraid of change and completely unafraid of challenges. The exhortation [expresses] an overriding concern for the poor in the world. Francis champions an idea that has lately been out of favor: the church’s “preferential option” for the poor. “God’s heart has a special place for the poor,” the Pope says. But it is not enough simply to say that God loves the poor in a special way and leave it at that. We must be also vigilant in our care and advocacy for them. Everyone must do this, says the Pope. “None of us can think we are exempt from concern for the poor and for social justice.” And in case anyone misses the point, after a critique of the “idolatry of money” and an “economy of exclusion,” the Pope says: “The Pope loves everyone, rich and poor alike, but he is obliged in the name of Christ to remind all that the rich must help, respect and promote the poor. I exhort you to generous solidarity and a return of economics and finance to an ethical approach which favors human beings.” This does not mean simply caring for the poor, it means addressing the structures that keep them poor: “The need to resolve the structural causes of poverty cannot be delayed.”

Note: For how you can help to end poverty through microlending, click here. For a treasure trove of great news articles which will inspire you to make a difference, click here.


From ‘Inequality for All,’ a challenge for America
2013-09-10, Washington Post
http://articles.washingtonpost.com/2013-09-10/opinions/41917153_1_income-ineq...

“Chilling.” That’s how one reviewer describes the experience of watching Harvey Weinstein’s latest film. It’s about income inequality. As Clinton Labor Secretary Robert Reich intones in the film, “Of all developed nations, the United States has the most unequal distribution of income, and we’re surging towards even greater inequality.” “Inequality for All,” directed by Jacob Kornbluth and set to be released nationwide on Sept. 27, comes at a critical moment for America. Sept. 15 marks the five-year anniversary of the collapse of Lehman Brothers — fueled by a toxic combination of deregulation, subprime lending and credit-default swaps — that precipitated the 2008 global economic crisis and laid bare the rot at the heart of our economic system. It was largely this orgy of greed that led the first Occupy Wall Street protesters to Zuccotti Park on Sept. 17, two years ago next week. “Inequality for All” throws into sharp relief the numbers and stories we hear. Combining footage from Reich’s electrifying Berkeley lectures with interviews, news clips and rich graphics, the film weaves a compelling narrative about how and why, since the late 1970s, income inequality has risen to crisis levels. The facts are breathtaking. In 1978, according to Reich, a “typical male worker” made $48,302, while the typical top 1 percenter earned $393,682, more than eight times as much. In 2010, even as overall gross domestic product and productivity increased, the average male worker’s wage fell to $33,751. Meanwhile, the average top 1 percent earner was making more than $1.1 million — 32 times the average earner.

Note: For more on income inequality, see the deeply revealing reports from reliable major media sources available here.


The Rich Get Richer Through the Recovery
2013-09-10, New York Times
http://economix.blogs.nytimes.com/2013/09/10/the-rich-get-richer-through-the-...

The top 10 percent of earners took more than half of the country’s total income in 2012, the highest level recorded since the government began collecting the relevant data a century ago, according to an updated study by the prominent economists Emmanuel Saez and Thomas Piketty. The top 1 percent took more than one-fifth of the income earned by Americans, one of the highest levels on record since 1913. The figures underscore that even after the recession the country remains in a new Gilded Age, with income as concentrated as it was in the years that preceded the Depression of the 1930s, if not more so. High stock prices, rising home values and surging corporate profits have buoyed [the] incomes of the most affluent Americans, with the incomes of the rest still weighed down by high unemployment and stagnant wages for many blue- and white-collar workers. “These results suggest the Great Recession has only depressed top income shares temporarily and will not undo any of the dramatic increase in top income shares that has taken place since the 1970s,” Mr. Saez, an economist at the University of California, Berkeley, wrote. The income share of the top 1 percent of earners in 2012 [jumped] to about 22.5 percent in 2012 from 19.7 percent in 2011. The economy remains depressed for most wage-earning families. With sustained, relatively high rates of unemployment, businesses are under no pressure to raise their employees’ incomes because both workers and employers know that many people without jobs would be willing to work for less. The share of Americans working or looking for work is at its lowest in 35 years.

Note: To read the UC Berkeley report on extreme income disparities, click here. For more on income inequality, see the deeply revealing reports from reliable major media sources available here.


Remaking the basic bargain
2013-09-03, Chicago Tribune
http://www.chicagotribune.com/sns-201309031400--tms--amvoicesctnav-b20130903-...

Back in 1914, Henry Ford announced he was paying workers on his Model T assembly line $5 a day -- three times what the typical factory employee earned at the time. The Wall Street Journal termed his action "an economic crime." But Ford knew it was a cunning business move. The higher wage turned Ford's auto workers into customers who could afford to buy Model Ts. In two years, Ford's profits more than doubled. Yet in the years leading up to the Great Crash of 1929 [the] wages of most American workers stagnated even as the economy surged. Gains went mainly into corporate profits and into the pockets of the very rich. American families maintained their standard of living by going deeper into debt, and the rich gambled with their gigantic winnings. In 1929, the debt bubble popped. The same thing happened in the years leading up to the crash of 2008. The lesson should be obvious. When the economy becomes too lopsided -- disproportionately benefiting corporate owners and top executives rather than average workers -- it tips over. It's still lopsided. We're slowly emerging from the depths of the worst downturn since the Great Depression, but nothing fundamentally has changed. Corporate profits are up largely because payrolls are down. Even Ford Motor Company is now paying its new hires half what it paid new employees a few years ago. All over the American economy, employee pay is now down to the smallest share of the economy since the government began collecting wage and salary data 60 years ago. And corporate profits constitute the largest share of the economy since then.

Note: The author of this analysis, Robert Reich, is former U.S. Secretary of Labor, a professor of public policy at the University of California at Berkeley, and the author of Aftershock: The Next Economy and America's Future. He blogs at http://www.robertreich.org. For more on income inequality, see the deeply revealing reports from reliable major media sources available here.


World Bank chief Jim Yong Kim: 'They said poverty would always be with us. Well, maybe not'
2013-07-07, The Independent (One of the UK's leading newspapers)
http://www.independent.co.uk/news/people/profiles/world-bank-chief-jim-yong-k...

Jim Yong Kim [is] the first man from outside the discipline of economics to take the helm at the World Bank. Having just celebrated his first year in charge, the Korean-American medical expert has refocused the world’s premier development bank on ending extreme poverty. The World Bank leader prefers to dwell on the positives. Global poverty, defined by the bank as living on $1.25 or less per day, was halved five years ahead of schedule. The next phase is to lift the remaining 20 per cent of the world’s population out of extreme poverty by 2030. “The efforts to end poverty have been really significant,” says Mr Kim. “They said poverty would always be with us. Well, maybe not.” A proportion of people – he estimates three per cent – will remain below the poverty line due to natural disasters and their related aftermaths, but otherwise “extreme poverty will be gone from the earth”. His appointment to the World Bank last year was not universally welcomed. Many observers resented his imposition by the United States over popular candidates from Africa and Latin America, while others worried that he was not an economist. They pointed to his presence at protests against the World Bank in 1993. Mr Kim now says that it was the lender’s “one size fits all” approach to economies that he objected to. As well as aiming to end poverty, the bank has set itself the task of tracking the progress of the bottom 40 per cent in every country as a means of measuring social mobility and equality.

Note: For a treasure trove of great news articles which will inspire you to make a difference, click here.


CEO Pay 1,795-to-1 Multiple of Wages Skirts U.S. Law
2013-04-29, Bloomberg News
http://www.bloomberg.com/news/2013-04-30/ceo-pay-1-795-to-1-multiple-of-worke...

Former fashion jewelry saleswoman Rebecca Gonzales and former Chief Executive Officer Ron Johnson have one thing in common: J.C. Penney Co. no longer employs either. The similarity ends there. Johnson, 54, got a compensation package worth 1,795 times the average wage and benefits of a U.S. department store worker when he was hired in November 2011, according to data compiled by Bloomberg. Gonzales’s hourly wage was $8.30 that year. Across the [S&P] 500 Index of companies, the average multiple of CEO compensation to that of rank-and-file workers is 204, up 20 percent since 2009, the data show. Almost three years after Congress ordered public companies to reveal actual CEO-to-worker pay ratios under the Dodd-Frank law, the numbers remain unknown. As the Occupy Wall Street movement and 2012 election made income inequality a social flashpoint, mandatory disclosure of the ratios remained bottled up at the Securities and Exchange Commission, which hasn’t yet drawn up the rules to implement it. Some of America’s biggest companies are lobbying against the requirement. “It’s a simple piece of information stockholders ought to have,” said Phil Angelides, who led the Financial Crisis Inquiry Commission, which investigated the economic collapse of 2008. “The fact that corporate executives wouldn’t want to display the number speaks volumes.” The lobbying is part of “a street-by-street, block-by-block fight waged by large corporations and their Wall Street colleagues” to obstruct the Dodd-Frank law, he said.

Note: For deeply revealing reports from reliable major media sources on income inequality, click here .


The Unequal State of America: Why America is more unequal than most
2012-12-20, MSNBC/Reuters
http://www.msnbc.msn.com/id/50256668#.UNc3IqwkSSo

Some rich countries are more unequal than others - and the United States more so than most. America has a higher degree of income inequality than almost any other developed country. Only three of the 34 members of the Organization for Economic Cooperation and Development rank higher - Chile, Mexico and Turkey. So why is the U.S. so much more unequal than its peers? The U.S. Congressional Research Service cited several potential reasons in a report earlier this year. One is that most other rich countries spend a bigger share of their national output on social programs, which tend to lessen income inequality. In Germany, public social spending accounted for 27.8 percent of gross domestic product in 2009, compared with 19.2 percent in the United States. A second factor is tax systems. A 2012 study by economists at the OECD found that, in general, the more a country spends on social programs, and the more progressive its tax-and-transfer system is, the more it can reduce income inequality. The U.S. is less effective at reducing inequality through taxes and benefits than the OECD average. Attitudes toward the poor may make a difference, some researchers say. A 2008 OECD study found that respondents in the United States and Korea were far more likely to say poor people were poor because they are lazy than did respondents in Nordic and Continental European countries. Recent studies ... have shown that Americans are now less likely to move into a class above their parents than are people in other rich countries.

Note: For deeply revealing reports from reliable major media sources on income inequality, click here.


The “People’s Bailout” Was Just the Beginning: What’s Next for Strike Debt?
2012-12-13, Yes! Magazine
http://www.yesmagazine.org/new-economy/peoples-bailout-just-the-beginning-wha...

Syracuse University art professor Thomas Gokey earned his Master of Fine Arts degree five years ago, but remains chained to his alma mater by $49,983 of debt. Soon after he graduated, the grim prospect of indefinite payments inspired its own art piece. Gokey put his debt up for sale in reconstituted squares of shredded money from the Federal Reserve. This year, together with the activist group Strike Debt, he helped organize a bold "People's Bailout" called the Rolling Jubilee, which has raised over $465,000. Bringing that money to the marketplace where collections companies buy and sell debt for pennies on the dollar, Strike Debt intends to purchase about $9 million of Americans' medical and educational debt—and then cancel it. Strike Debt, which grew out of Occupy Wall Street, wants to foment conversation about the debt we rack up in pursuit of basic needs, and the industries that profit from that debt. Gokey is currently on a year-long unpaid leave from teaching to help organize the Rolling Jubilee and upcoming Strike Debt projects. Thomas Gokey: Since I'm an educator, I'm thinking about the ways in which my students and I seem to be getting taken advantage of. We look at how much it's costing each one of my students to take one of my classes, and how much I'm getting paid to teach the class. And we look at each other and think, why don't we just go hold our classes at the public library? Somebody's obviously making money off both of us, so can't we cut out that middleman and focus on education?

Note: For deeply revealing reports from reliable major media sources on income inequality, click here.


An Excerpt: 'Plutocrats'
2012-10-15, NPR
http://www.npr.org/books/titles/162800856/plutocrats-the-rise-of-the-new-glob...

Branko Milanovic is an economist at the World Bank. He first became interested in income inequality studying for his PhD in the 1980s in his native Yugoslavia, where he discovered it was officially viewed as a "sensitive" subject — which meant one the ruling regime didn't want its scholars to look at too closely. But when Milanovic moved to Washington, he discovered a curious thing. Americans were happy to celebrate their super-rich and, at least sometimes, worry about their poor. But putting those two conversations together and talking about economic inequality was pretty much taboo. "I was once told by the head of a prestigious think tank in Washington, D.C., that the think tank's board was very unlikely to fund any work that had income or wealth inequality in its title," Milanovic ... explained in a recent book. "Yes, they would finance anything to do with poverty alleviation, but inequality was an altogether different matter." "Why?" he asked. "Because 'my' concern with the poverty of some people actually projects me in a very nice, warm glow: I am ready to use my money to help them. Charity is a good thing; a lot of egos are boosted by it and many ethical points earned even when only tiny amounts are given to the poor. But inequality is different: Every mention of it raises in fact the issue of the appropriateness or legitimacy of my income." When the discussion shifts from celebratory to analytical, the super-elite get nervous.

Note: Excerpted from Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else by Chrystia Freeland. For revealing major media articles showing the stark gap between the uber-rich and the rest of us, click here.


Family net worth plummets nearly 40%
2012-06-11, CNN
http://money.cnn.com/2012/06/11/news/economy/fed-family-net-worth/

The average American family's net worth dropped almost 40% between 2007 and 2010, according to a triennial study released [on June 11] by the Federal Reserve. The stunning drop in median net worth -- from $126,400 in 2007 to $77,300 in 2010 -- indicates that the recession wiped away 18 years of savings and investment by families. The results ... highlight the marked deterioration in household finances brought on by the financial crisis and ensuing recession. Much of the drop off in net worth -- to levels not seen since 1992 -- was attributable to a sharp decline in housing values, the Fed said. In 2007, the median homeowner had a net worth of $246,000. Three years later that number had fallen to $174,500, a loss of more than $70,000 on average. Making matters worse, income levels also fell during the tumultuous three-year period, with median pre-tax income falling 7.7% as earnings from capital gains all but disappeared. The loss of income and net worth appears to have impacted savings rates, as the number of Americans who said they saved in the prior year fell from 56.4% in 2007 to 52.0% in 2010 -- the lowest level recorded since the early 1990s. Families in the top 10% of income actually saw their net worth increase over the period, rising from a median of $1.17 million in 2007 to $1.19 million in 2010. Middle-class families who ranked in the 40th to 60th percentile of income earners reported that their median net worth fell from $92,300 to $65,900 over the same time period.

Note: What this article fails to emphasize sufficiently is that while most people have lost vast amounts of wealth, the wealthiest 1% has grown incredibly richer even through the recession. Is something wrong here? For key reports from reliable sources on wealth inequality, click here.


A chat with Emmanuel Saez: Doing the math for the 99 percent
2012-04-07, UC Berkeley's alumni publication 'The Promise of Berkeley.'
http://promise.berkeley.edu/lib/pdf/2012_spring_promise.pdf

Emmanuel Saez is ... director of Berkeley’s Center for Equitable Growth. In 2008, on the cusp of the Great Recession, Saez co-authored a landmark study that revealed a stark gap between the earnings of America’s wealthiest households and the remaining 99 percent. Saez’s recent work shows that, while the recession initially reduced the income gap, postrecession gains have mostly gone to the top 1 percent. The extraordinary increase in income concentration in the United States from 2002 to 2007 was driven in large part by deregulation of the financial and real estate industries. The resulting real estate bubble triggered the 2008 recession. Evidence shows that progressive taxation is the most powerful tool for curbing income concentration. For example, from the Great Depression into the 1970s, when the U.S. had very high tax rates on top earners, the income gap was very small, and economic growth was incredibly strong. During the 1990s, incomes for the top 1% nearly doubled, while paychecks for the bottom 99% went up only 20%. Between 2002 and 2007 2/3 of all income gains went to the top 1%. In 2010, the first year of economic recovery, the top 1% captured 93% of income gains.

Note: For Prof. Saez's excellent study, "The Evolution of Top Incomes in the United States" click here.


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