Sunday, April 24, 2011

The Insatiable Rich

Some sobering facts by Hendrik Van den Berg, University of Nebraska, Lincoln, from his article “Our Growing Income Inequality (It's NOT an Accident)”

Growing Income Gap
  • Forty years ago, the minimum wage provided 25% more real purchasing power than it does today. In 1968, the minimum wage was $1.60 per hour. $1.60 would buy about $9.00 worth of goods and services today. Today, a person working full time at the minimum wage of $7.25 per hour lives below the poverty line.
  • For the past thirty years, virtually all income growth in the U.S. has been captured by the top 10% of income earners, while the average real income for the remaining 90% has not changed for 30 years.
  • In 2009, the average non-supervisory worker earned $18.62 per hour. However, in 1972 the real purchasing power of the average real non-supervisory wage was the equivalent of $20.20 today. Thus, in the past 27 years, the value of our income has declined.
  • The productivity of the average worker rose more than 100% over those 37 years. Thus, workers have taken a pay cut, despite producing more than twice as much.
  • The top 10% percent of income earners in the U.S. earned 50% of all U.S. income in 2007, more than the top 10% did in the “Roaring Twenties.”
  • The top 1% of U.S. income earners took home about 25% of all income in 2007.
Growing Wealth Gap
  • In 2007, the top 20% of wealth holders in the United States held 85% of all wealth.
  • The median household’s wealth, (including home equity), was only $43,600 in 2007.
  • Median wealth (including home equity) for Hispanics or Blacks was only $500 and $400, respectively
  • The top 20% holds 93% of all financial wealth (stocks, bonds and other savings).
  • The top 10%  of wealth holders own 93.3% of all business equity.
  • Roughly 10% of the population owns just about all of the productive capacity of the U.S.
  • The top 1% of wealth holders owns 63% of all business equity (i.e., 1% of the population owns two-thirds of the private sector).

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