Income Inequality News ArticlesExcerpts of key news articles on income inequality
G.D.P. is an index of a country’s entire economic output — a tally of, among many other things, manufacturers’ shipments, farmers’ harvests, retail sales and construction spending. It’s a figure that compresses the immensity of a national economy into a single data point of surpassing density. The conventional feeling about G.D.P. is that the more it grows, the better a country and its citizens are doing. [But] it has been a difficult few years for G.D.P. For decades, academics and gadflies have been critical of the measure, suggesting that it is an inaccurate and misleading gauge of prosperity. What has changed more recently is that G.D.P. has been actively challenged by a variety of world leaders, especially in Europe, as well as by a number of international groups, like the Organization for Economic Cooperation and Development. The G.D.P. ... has not only failed to capture the well-being of a 21st-century society but has also skewed global political objectives toward the single-minded pursuit of economic growth. Which indicators are the most suitable replacements for, or most suitable enhancements to, G.D.P. Should they measure educational attainment or employment? Should they account for carbon emissions or happiness?
Note: Which is more important, the economic prosperity of a people, or the well being and level of happiness?
New federally financed drug research reveals a stark disparity: children covered by Medicaid are given powerful antipsychotic medicines at a rate four times higher than children whose parents have private insurance. And the Medicaid children are more likely to receive the drugs for less severe conditions than their middle-class counterparts, the data shows. Those findings, by a team from Rutgers and Columbia, are almost certain to add fuel to a long-running debate. Do too many children from poor families receive powerful psychiatric drugs not because they actually need them – but because it is deemed the most efficient and cost-effective way to control problems that may be handled much differently for middle-class children? The questions go beyond the psychological impact on Medicaid children, serious as that may be. Antipsychotic drugs can also have severe physical side effects, causing drastic weight gain and metabolic changes resulting in lifelong physical problems. Part of the reason is insurance reimbursements, as Medicaid often pays much less for counseling and therapy than private insurers do. Studies have found that children in low-income families may have a higher rate of mental health problems – perhaps two to one – compared with children in better-off families. But that still does not explain the four-to-one disparity in prescribing antipsychotics.
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The incomes of the young and middle-aged — especially men — have fallen off a cliff since 2000, leaving many age groups poorer than they were even in the 1970s, a USA TODAY analysis of new Census data found. People 54 or younger are losing ground financially at an unprecedented rate in this recession, widening a gap between young and old that had been expanding for years. The dividing line between those getting richer or poorer: the year 1955. If you were born before that, you're part of a generation enjoying a four-decade run of historic income growth. Every generation after that is now sinking economically. Household income for people in their peak earning years — between ages 45 and 54 — plunged $7,700 to $64,349 from 2000 through 2008, after adjusting for inflation. People in their 20s and 30s suffered similar drops. Older people enjoyed all the gains. The line between the haves and have-nots runs through the middle of the Baby Boom, the population explosion 1946-64. "The second half of the Baby Boom may be in the worst shape of all," says demographer Cheryl Russell of New Strategist Publications, a research firm. "They're loaded with expenses for housing, cars and kids, but they will never generate the income that their parents enjoyed."
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E-mailers sent me copies of two news photos that revealed an apparent double standard regarding black and white flood victims in New Orleans. One of the images, shot by photographer Dave Martin for The Associated Press, shows a young black man wading through chest-deep waters after "looting" a grocery store, according to the caption. In the other, taken by photographer Chris Graythen for AFP/Getty Images, a white man and a similarly light-skinned woman also waded through chest-deep water after "finding" goods that included bread and soda in a local grocery store, according to the caption. Apparently, quipped a cynical blogger at Daily Kos, "It's not looting if you're white."
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Most readers have probably heard of Bitcoin, the digital coin that dominates the cryptocurrency market. It has gained notice both because of its skyrocketing value (from less than a cent in early 2010 to around $2,600 currently). But do you know Ethereum, with a total value of coins in circulation of close to $20 billion? Then there are more than 800 lower-value and often creatively named coins among those listed on Coinmarketcap.com. After years as a niche market for technologically sophisticated anarchists and libertarians excited about a decentralised financial network not under government control, digital coins may be on the verge of going mainstream. Cryptocurrency has understandable appeal to millennials, who came of age during the 2008 financial crisis. “There’s a low cost for entry, you don’t pay a lot of fees and millennials are the most tech-savvy,” said John Guarco, 22. Like most of the people interviewed for this article, [Guarco] asked that names of the coins he has invested in not be published. Unlike previous generations, many of these greenhorn investors don’t have pensions, are mistrustful of saving money in mutual funds, and are fully accustomed to owning digital assets. As traditional paths to upper-middle-class stability are being blocked by debt, exorbitant housing costs and a shaky job market, these investors view cryptocurrency not only as a hedge against another stock market crash, but also as the most rational, and even utopian, means of investing their money.
Note: The media has given surprisingly little coverage to the huge gains of bitcoin and other digital currencies. If you had invested $1,000 in Bitcoin four years ago when the price was about $110 per coin, your investment would now be worth nearly $44,000, a whopping 40 times increase. The fact that the media is covering this so little suggests that the price may continue to rise as more people find out, though this is highly speculative and uncertain.
Despite the urgings of all of the world’s great religions, “neoliberalism,” the economic narrative that now runs the world, has convinced us that “greed is good.” The sole goal of the economy and business, it says, is to generate financial wealth. Markets are perfect and all of us individualistically maximizing our own desires will somehow deliver a world that works. Except that it didn’t. Today eight men have as much wealth as the bottom 3.5 billion humans on earth. The middle class is sinking into poverty with mothers working two jobs to support their families, while proponents of austerity cut social services to give greater tax benefits to the richest one percent. The rich call themselves “job creators.” But they invest not in new companies, but in financial instruments that benefit the big banks. So in 2016 the bonuses paid to Wall St. bankers, if shared among minimum wage earners, would have doubled the minimum wage. Just the bonuses. The old narrative is based on ... assumptions that scientists now reject. Psychologists, evolutionary biologists, anthropologists and others find that most people are not greedy, rugged individualists. We seek to meet our needs, but more, people seek goodness, connection, and caring. We desire to be rewarded for meaningful contributions with a decent living. We are not mostly motivated to acquire wealth. To thrive, businesses and society must pivot toward a new purpose: shared well-being on a healthy planet.
Note: The above article was written in support of the Regenerative Future Summit, which will take place in May 2017 in Boulder, Colorado. For more along these lines, see concise summaries of deeply revealing news articles on corporate corruption and income inequality.
Manufacturing jobs used to be a path to the middle class. But now many skilled, working Americans need some form of public assistance because their wages don’t pay for basic living expenses. Over 2 million supervised manufacturing workers, or about a third of the total, need food stamps, Medicaid, tax credits for the poor or other forms of publicly subsided assistance while they work on goods that can carry the tag “Made in the U.S.A.,” according to research of official government wage and welfare data released Tuesday by the University of California, Berkeley. The cost of these benefits to the U.S. taxpayer? From 2009 to 2013, federal and state governments subsidized the low manufacturing wages paid by the private sector to the tune of $10.2 million per year. “In decades past, production workers employed in manufacturing earned wages significantly higher than the U.S. average, but by 2013 the typical manufacturing production worker made 7.7 percent below the median wage for all occupations,” said the paper. The research aimed to extend an already well-established national debate on wages paid in the service industry, which are often juxtaposed to the factory work that lifted millions of Americans out of poverty for much of the 20th century. The research comes as U.S. workers overall are experiencing one of the lowest paces of wage growth on record.
Note: For more along these lines, see concise summaries of deeply revealing income inequality news articles from reliable major media sources.
The Bureau of Labor Statistics released its monthly employment report at 8:30 a.m.. [Daniel Nadler] sat at the kitchen table in his one-bedroom apartment ... as the software of his company, Kensho, scraped the data from the bureau’s website. Within two minutes, an automated Kensho analysis popped up on his screen. At 8:35 a.m., Kensho’s analysis would be made available to employees at Goldman Sachs. In addition to being a customer, Goldman is also Kensho’s largest investor. "People always tell me ... ‘I used to have a guy whose job it was to do nothing other than this one thing," Nadler said. Within a decade, he said, between a third and a half of the current employees in finance will lose their jobs to Kensho and other automation software. If jobs can be displaced at Goldman, they can probably be displaced even more quickly at other, less sophisticated companies, within the financial industry as well as without. In late 2013, two Oxford academics released a paper claiming that 47 percent of current American jobs are at "high risk" of being automated within the next 20 years. So far the burden of job losses is stopping just short of the executive suites, even as the gains in efficiency are worsening already troubling levels of income inequality.
Has Michael Moore gone soft? You might think so, making a snap judgment of Where to Invade Next, a ... documentary hellbent on seeing the best in people. Other people. Not us Americans. Moore sets up his film by daydreaming about a summons from the Joint Chiefs of Staff. "Instead of using Marines, use me," he pleads. As we watch a collage of America at its worst – bank scandals, stock frauds, housing foreclosures, black teens murdered by cops – Moore sets out to invade the world for bright ideas. In Italy, he meets a couple who get 30 days paid vacation each year with no loss in productivity. In France, Moore is astonished by school kids who are served nutritional food. On a visit to a Norway prison, the worst felons are treated with compassion, with sentences capped at 21 years, even for murderers. Yet the crime rate is low, as is recidivism. In Tunisia, women win free health care from a hidebound Islamist regime. And get a load of Portugal, where using drugs is not a crime, but rehab is offered to those who want it. A trip to Iceland finds that the bankers who brought economic ruin to their country are thrown in jail instead of being bailed out. Love him or hate his methods, Moore touches a nerve in Where to Invade Next. In a climactic remembrance at the Berlin Wall, he recalls a time when a corrupt regime was brought down by people willing to protest. What counted most were humanitarian principles, the same bedrock concepts that America was founded on. See, the joke's on us.
President Obama has spent the summer at war with his own party over how to write the rules of global trade. Not since Woodrow Wilson promised to break the “money monopoly” ... has the Democratic Party found itself so inflamed against the intersection of wealth and power. The giants of the party now find their credentials, and motivations, under attack. The new fire is fueled by a shift in economics that feels like a crisis for many Americans. Real wages have increased 138% for the top 1% of American income earners since 1979, but only 15% for the 90% below. From 2002 to 2013, the only groups of American households that did not see their real incomes on average decline or stagnate were headed by college graduates and young people in their 20s. At the same time, over a quarter-century, fixed costs such as housing, education and health care have outpaced inflation. [Sen. Elizabeth Warren’s] message ... is that both Republicans and Democrats have misread the economic challenge and been co-opted by the forces of greed. “The pressure on the middle class is not simply a natural force,” she says. “It is the result of deliberate decisions made by the leaders of this country.” America’s enemy, in other words, lurks within. “This is not a top-vs.-bottom story,” she continues. “This is a top-and-everyone-else story. This is a 90-10 story.” Two-thirds of Americans now believe that wealth should be more evenly distributed. An even greater share of the country supports raising taxes on those who make more than $1 million.
Note: For more along these lines, see concise summaries of deeply revealing income inequality news articles from reliable major media sources. Then explore the excellent, reliable resources provided in our Elections Information Center.
Not long ago I was asked to speak to a religious congregation about widening inequality. Shortly before I began, the head of the congregation asked that I not advocate raising taxes on the wealthy. I had a similar exchange last year with the president of a small college who had invited me to give a lecture that his board of trustees would be attending. “I’d appreciate it if you didn’t criticize Wall Street,” he said. It seems to be happening all over. A nonprofit group devoted to voting rights decides it won’t launch a campaign against big money in politics for fear of alienating wealthy donors. A Washington think tank releases a study on inequality that fails to mention the role big corporations and Wall Street have played ... presumably because the think tank doesn’t want to antagonize its corporate and Wall Street donors. A major university shapes research and courses around economic topics of interest to its biggest donors, notably avoiding any mention of the increasing power of large corporations and Wall Street on the economy. It’s bad enough that big money is buying off politicians. It’s also buying off nonprofits that used to be sources of investigation, information and social change, from criticizing big money. Our democracy is directly threatened when the rich buy off politicians. But no less dangerous is the quieter and more insidious buy-off of institutions democracy depends on to research, investigate, expose and mobilize action against what is occurring.
Note: The above article was written by former U.S. Secretary of Labor and UC Berkeley professor Robert Reich. For more along these lines, see concise summaries of deeply revealing income inequality news articles from reliable major media sources.
You may think you know about Martin Luther King, Jr., but there is much about the man and his message we have conveniently forgotten. In the last year of his life, ... he announced what he called the Poor People's Campaign, a "multi-racial army" that would come to Washington, build an encampment and demand from Congress an "Economic Bill of Rights" for all Americans -- black, white, or brown. He had long known that the fight for racial equality could not be separated from the need for economic equity -- fairness for all, including working people and the poor. Read part of the speech Dr. King made at Stanford University in 1967, a year before his assassination and marvel at how relevant his words remain: "There are literally two Americas. One America ... is overflowing with the milk of prosperity and the honey of opportunity. In this America millions of work-starved men walk the streets daily in search for jobs that do not exist. In this America millions of people find themselves living in rat-infected vermin-filled slums. In this America people are poor by the millions." A new briefing paper from the advocacy group National Employment Law Project (NELP) finds there are 27 million unemployed or underemployed workers in the U.S. labor force. Five years after the financial meltdown, "the average duration of unemployment remains at least twice that of any other recession since the 1950s." Matter of fact, "In the past 30 years, compensation for chief executives in America has increased 127 times faster than the average worker's salary."
Note: For a great collection of quotes, audio, and video clips of King, click here. For powerful evidence his assassination was coordinated from the highest levels, click here. For deeply revealing reports from reliable major media sources on income inequality, click here.
Economic inequality is growing in the world's richest countries, particularly in the United States. The gap between rich and poor has widened over the last 20 years in nearly all the countries studied, even as trade and technological advances have spurred rapid growth in their economies. With job losses and home foreclosures skyrocketing and many of these countries now facing recession, policymakers must act quickly ... the Organization for Economic Cooperation and Development said. "What will happen if the next decade is not one of world growth but of world recession? If a rising tide didn't lift all boats, how will they be affected by an ebbing tide?" Oxford University economist Anthony Atkinson said at a conference at the organization's Paris headquarters. In a 20-year study of its member countries, the group found inequality had increased in 27 of its 30 members as top earners' incomes soared while others' stagnated. The United States has the highest inequality and poverty rates in the organization after Mexico and Turkey, and the gap has increased rapidly since 2000, the report said. France, meanwhile, has seen inequalities fall in the past 20 years as poorer workers are better paid. Rising inequality threatens social mobility ... which is lower in countries like the United States, Great Britain and Italy, where inequality is high, than countries with less inequality such as Denmark, Sweden and Australia, the report said. Wealthy households are not only widening the gap with the poor, but in countries such as the United States, Canada and Germany, they are also leaving middle-income earners further behind.
Note: For more reports from reliable sources on increasing income inequality, click here.
New government research has found “large and growing” disparities in life expectancy for richer and poorer Americans, paralleling the growth of income inequality in the last two decades. Life expectancy for the nation as a whole has increased, the researchers said, but affluent people have experienced greater gains, and this, in turn, has caused a widening gap. One of the researchers, Gopal K. Singh, a demographer at the Department of Health and Human Services, said “the growing inequalities in life expectancy” mirrored trends in infant mortality and in death from heart disease and certain cancers [and] that federal officials had found “widening socioeconomic inequalities in life expectancy” at birth and at every age level. He and another researcher, Mohammad Siahpush, a professor at the University of Nebraska Medical Center in Omaha, developed an index to measure social and economic conditions in every county, using census data on education, income, poverty, housing and other factors. In 1980-82, Dr. Singh said, people in the most affluent group could expect to live 2.8 years longer than people in the most deprived group (75.8 versus 73 years). By 1998-2000, the difference in life expectancy had increased to 4.5 years (79.2 versus 74.7 years), and it continues to grow, he said. After 20 years, the lowest socioeconomic group lagged further behind the most affluent, Dr. Singh said, noting that “life expectancy was higher for the most affluent in 1980 than for the most deprived group in 2000. If you look at the extremes in 2000,” Dr. Singh said, “men in the most deprived counties had 10 years’ shorter life expectancy than women in the most affluent counties (71.5 years versus 81.3 years).” The difference between poor black men and affluent white women was more than 14 years (66.9 years vs. 81.1 years).
Note: For a powerful summary of corruption in the government regulation of the health care industry, click here.
The richest Americans' share of national income has hit a postwar record, surpassing the highs reached in the 1990s bull market, and underlining the divergence of economic fortunes blamed for fueling anxiety among American workers. The wealthiest 1% of Americans earned 21.2% of all income in 2005, according to new data from the Internal Revenue Service. That is up sharply from 19% in 2004, and surpasses the previous high of 20.8% set in 2000, at the peak of the previous bull market in stocks. The bottom 50% earned 12.8% of all income, down from 13.4% in 2004 and a bit less than their 13% share in 2000. The IRS data go back only to 1986, but academic research suggests the rich last had this high a share of total income in the 1920s. Until this summer, soaring stock prices and buoyant credit markets had produced spectacular payouts for private-equity and hedge-fund managers, and investment bankers. One study by University of Chicago academics Steven Kaplan and Joshua Rauh concludes that in 2004 there were more than twice as many such Wall Street professionals in the top 0.5% of all earners as there are executives from nonfinancial companies. Mr. Rauh said "it's hard to escape the notion" that the rising share of income going to the very richest is, in part, "a Wall Street, financial industry-based story." The study shows that the highest-earning hedge-fund manager earned double in 2005 what the top earner made in 2003, and top 25 hedge-fund managers earned more in 2004 than the chief executives of all the companies in the Standard & Poor's 500-stock index, combined. The IRS data show that the median tax filer's income -- half earn less than the median, half earn more -- fell 2% between 2000 and 2005 when adjusted for inflation, to $30,881. At the same time, the income level for the tax filer just inside the top 1% grew 3%, to $364,657.
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A billion dollars just doesn't go as far as it used to. For the first time, it takes more than $1 billion to earn a spot on Forbes magazine's list of the 400 richest Americans. The minimum net worth for inclusion in this year's rankings released Thursday was $1.3 billion, up $300 million from last year. The new threshold meant 82 of America's billionaires didn't make the cut. Collectively, the people who made the rankings released Thursday are worth $1.54 trillion, compared with $1.25 trillion last year. The very top of the list was unchanged: Microsoft Corp. founder Bill Gates led the list for the 14th straight year, this time with a net worth estimated at $59 billion. He was followed by Warren Buffett of Berkshire Hathaway Inc. in second place with an estimated $52 billion. The list showed some notable changes. Joining the top 10 of the country's richest for the first time were Google Inc. founders Sergey Brin and Larry Page, who tied for fifth place. The 34-year-old moguls' wealth has quadrupled since 2004 to an estimated $18.5 billion this year, while their company's stock value has surged 500 percent. Lower down, almost half of the 45 newcomers made their millions in hedge funds and private equity investments. "Wall Street really led the charge this year," said Matthew Miller, editor of the Forbes list.
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Highly educated workers have done better than those with less education, but a college degree has hardly been a ticket to big income gains. The 2006 Economic Report of the President tells us that the real earnings of college graduates actually fell more than 5 percent between 2000 and 2004. So who are the winners from rising inequality? It's not the top 20 percent, or even the top 10 percent. The big gains have gone to a much smaller, much richer group than that. A new research paper by Ian Dew-Becker and Robert Gordon of Northwestern University, "Where Did the Productivity Growth Go?," gives the details. Between 1972 and 2001 the wage and salary income of Americans at the 90th percentile of the income distribution rose only 34 percent, or about 1 percent per year. So being in the top 10 percent of the income distribution, like being a college graduate, wasn't a ticket to big income gains. But income at the 99th percentile rose 87 percent; income at the 99.9th percentile rose 181 percent; and income at the 99.99th percentile rose 497 percent. Should we be worried about the increasingly oligarchic nature of American society? Yes, and not just because a rising economic tide has failed to lift most boats. Both history and modern experience tell us that highly unequal societies also tend to be highly corrupt.
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Making tiny loans to poor entrepreneurs in developing countries has long been a popular charitable cause, but it is now gaining traction as an investment. Microfinance, as these loans are known, is aimed at lifting some of the world's most destitute people out of poverty by providing seed money for small businesses. Funding for the loans traditionally has come from charities and government-aid organizations. Now, an increasing number of private funds are steering capital to microfinance. Many of the new investment instruments have been launched by nonprofit organizations long involved in the industry, including Grameen Foundation USA, the Foundation for International Community Assistance, both in Washington. Microfinance investing got a boost this fall when eBay Inc. founder Pierre Omidyar and his wife, Pamela, gave $100 million to Tufts University to create a fund that invests in microfinance vehicles. Microfinance investment funds...lend money for small-scale businesses, such as vending fruit, weaving shawls or operating small farms in poor countries around the world. Calvert Foundation offers Community Investment Notes, which require a minimum $1,000 investment, and can be earmarked to invest in developing countries or other initiatives, including post-Katrina recovery on the Gulf Coast.
Note: Microfinance is one of the most empowering movements in the world. When we let go of our fears around finances and put our money where our heart is, we invite major transformation into both our personal lives and our world. For how to get involved, see http://www.WantToKnow.info/051023microcredit
With few exceptions, today’s populist insurgents are more concerned with immigration and sovereignty than with the top rate of income tax. This disconnect may be more than an oddity. It may be a sign of the corrupting influence of inequality on democracy. Rather than straightforwardly increasing pressure on politicians to do something about skewed income distributions ... rising inequality might instead boost the power of the rich, thus enabling them to counter the popular will. Research in political science gives substance to the impression that America’s rich wield outsize influence. The relation between concentrated wealth and the political power of the rich is scarcely limited to political spending, or to America. The rich have many means to shape public opinion: financing nominally apolitical think-tanks, for instance, or buying media outlets. Although their power may sometimes be used to influence the result of a particular vote, it is often deployed more subtly, to shape public narratives about which problems deserve attention. Rising inequality ... is associated with political agendas more focused on matters related to “social order”, such as crime and immigration. Issues such as economic justice are crowded out. As their wealth increases, [the rich] have a greater ability to press politicians to emphasise some topics rather than others. The rich are powerful, but not all-powerful. If political leaders tried it, they might well find that redistribution is a winner at the ballot box.
Public appeals by families or individuals for help paying basic medical bills seem to be on the rise in the United States. Crowdfunding websites such as GoFundMe.com report that medical expenses rank as their largest single category of appeals; other sites such as HelpHopeLive have sprung up specifically for medical expense appeals. [This points] to a crisis in the American healthcare system in two ways. One involves the gaps and other problems with U.S. healthcare that make crowdfunding campaigns necessary. Lawmakers who support policies that drive people to expose their personal lives in order to obtain desperately needed care should be ashamed of themselves. The other crisis underscored by the rise of crowdfunding concerns the ethical issues raised by public appeals for medical care itself. Those are addressed in a new article in the Journal of the American Medical Assn.. Crowdfunding for expenses that should be met by private insurers or government healthcare programs ... can make the delivery of healthcare fundamentally unfair. They can direct resources away from patients who need them the most toward those whose campaigns are merely “more vocal, photogenic, or emotionally appealing.”
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