Posted by: pjeanty
on Apr 14, 2011
Tagged in: Untagged
The share of the national income received by the richest Americans has been rising steadily since the Great Depression.
Between 1995 and 2004, average household wealth nearly doubled and the percentage of millionaires tripled. However, 89% of total growth was driven by the wealthiest quartile. In turn, most of that growth was driven by the top 1% of income earners.
The average after-tax income of the top 1% of income earners increased by 129% between 1979 and 2003. Between 1997 and 2001, the richest 1% received a larger share of the national income than at any time since 1937, with incomes rising by an average $180,000.
Between 1979 and 2003, the bottom quintile of income earners increased their after-tax income by just 4%. The average after-tax income of the bottom 75% of tax filers actually fell slightly between 2002 and 2003. In 2009, the nominal median income fell to $49,777, from $50,303 the year before. This is the first time the nominal median income has dropped since census records have been kept.
As of 2010, the poverty rate [$10,285-11,161] is at 14.5%, up from 14.3% the year before. This has already eclipsed nearly every recent year except 1992 (14.8%).
The Gini index is a percentage measure of inequality in economic distribution in which 0 represents perfect equality and 100 represents perfect inequality (1 person holds all the wealth). The lowest reported Gini index for the United States, 38.6, was in 1968. The highest reported Gini index, 47.0, was in 2006. As of 2009, the Gini index is 46.8. This is a small rise from the 2008 Gini index of 46.69.
There is a winning team in this game. Financially speaking (only financially), the one with the most "toys" wins. We also know, "s/he who has the gold makes the rules". It is always better to be with the winning team in the end. These adages are valid individually, corporately, nationally and in the international arena.
To win we have to work hard, yes. Also, (maybe more importantly) we have to work smart. A keen sense of "awareness" (self & one's context) to augment high education, plus a clear understanding and leveraging of one's "differentiator" as competitive advantage are paramount in my view.
The budget battle is shaping up in Washington, DC. It is as much a dollars and cents debate as it is about values, philosophy and world view. It seems to me that a healthy dose of "picking oneself up by the boot straps" is very important. At the same time nurturing a vibrant community as a whole with smart long term strategic investments in children/education while honoring the elderly make intelligent sense.