99% v. 1%

With the “Occupy Wall St,” movement, there has been a lot of talk about the 1 percenters and there was an article in the Hufffington Post that caught my eye.

Most Americans Think Income Inequality Is A Big Problem: Poll
The Huffington Post
By Alexander Eichler
10/31/11

The people occupying Wall Street aren't the only ones worried about the wealth gap.

Nearly three-quarters of the people in a new poll conducted by The Hill say that income inequality is a problem for the United States. Fifty-five percent of respondents said income inequality is a big problem, while another 19 percent described it as somewhat of a problem.

The findings come only days after a Congressional Budget Office report showed the very highest earners in the United States have been pulling away from the rest of the population for over 30 years.

This is not the only time when there was such a wide gap between the rich and the poor, it has happened before in our history, in the late 1990s and the late 1920s. In the 1890s, the mega-rich John D. Rockefeller, Andrew Carnegie, Philip Armour, Jay Gould, and James Mellon made their fortunes then and that era was followed by a depression. Then in the 1920s the disparity between the rich and poor once again grew to where the top decile of income had 45% share of income and of that top 10%, the top 1% had a 20% share of that 45%¹. Hmm… now where have we seen that wide disparity of income? Also consider that 1920s was followed by the worst depression this country has been through. There is a cycle here, as the gap between the rich and poor grows, it is followed by a depression. It is the middle class that supports the economy, we spend and the economy grows. The mega-rich can only by some many cars and televisions, they don’t support the economy, instead they are leeches and suck up all the money.

At the same time that the fortunes of the mega-rich has grown, those who are living below the poverty level has also grown.

Number of poor hit record 46 million in 2010
Reuters
By David Morgan
Sep 13, 2011

The Census Bureau's annual report on income, poverty and health insurance coverage said the national poverty rate climbed for a third consecutive year to 15.1 percent in 2010 as the economy struggled to recover from the recession that began in December 2007 and ended in June 2009.

That marked a 0.8 percent increase from 2009, when there were 43.6 million Americans living in poverty.

The number of poor Americans in 2010 was the largest in the 52 years that the Census Bureau has been publishing poverty estimates, the report said, while the poverty rate was the highest since 1993.

If that did move you, then take a look at this graph from Mother Jones…

And who says there isn’t class warfare?

¹Piketty, T., & Saez, E. (2006, January). The Evolution of Top Incomes: A Historical and International Perspective. NBER Working Paper No. 11995. Cambridge, MA: NBER.
http://unpan1.un.org/intradoc/groups/public/documents/APCITY/UNPAN027111.pdf