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Forum Post: The Rich Get Even Richer By steven ratner

Posted 8 years ago on March 26, 2012, 7:03 a.m. EST by flip (7101)
This content is user submitted and not an official statement

NEW statistics show an ever-more-startling divergence between the fortunes of the wealthy and everybody else — and the desperate need to address this wrenching problem. Even in a country that sometimes seems inured to income inequality, these takeaways are truly stunning.

In 2010, as the nation continued to recover from the recession, a dizzying 93 percent of the additional income created in the country that year, compared to 2009 — $288 billion — went to the top 1 percent of taxpayers, those with at least $352,000 in income. That delivered an average single-year pay increase of 11.6 percent to each of these households.

Still more astonishing was the extent to which the super rich got rich faster than the merely rich. In 2010, 37 percent of these additional earnings went to just the top 0.01 percent, a teaspoon-size collection of about 15,000 households with average incomes of $23.8 million. These fortunate few saw their incomes rise by 21.5 percent.

The bottom 99 percent received a microscopic $80 increase in pay per person in 2010, after adjusting for inflation. The top 1 percent, whose average income is $1,019,089, had an 11.6 percent increase in income.

This new data, derived by the French economists Thomas Piketty and Emmanuel Saez from American tax returns, also suggests that those at the top were more likely to earn than inherit their riches. That’s not completely surprising: the rapid growth of new American industries — from technology to financial services — has increased the need for highly educated and skilled workers. At the same time, old industries like manufacturing are employing fewer blue-collar workers.

The result? Pay for college graduates has risen by 15.7 percent over the past 32 years (after adjustment for inflation) while the income of a worker without a high school diploma has plummeted by 25.7 percent over the same period.

Government has also played a role, particularly the George W. Bush tax cuts, which, among other things, gave the wealthy a 15 percent tax on capital gains and dividends. That’s the provision that caused Warren E. Buffett’s secretary to have a higher tax rate than he does.

As a result, the top 1 percent has done progressively better in each economic recovery of the past two decades. In the Clinton era expansion, 45 percent of the total income gains went to the top 11 percent; in the Bush recovery, the figure was 65 percent; now it is 93 percent.

Just as the causes of the growing inequality are becoming better known, so have the contours of solving the problem: better education and training, a fairer tax system, more aid programs for the disadvantaged to encourage the social mobility needed for them escape the bottom rung, and so on.



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[-] 5 points by TrevorMnemonic (5827) 8 years ago

Great post. Once again Flip, you are spot on.

[-] 2 points by flip (7101) 8 years ago

thanks - i am troubled by the right wing on this site

[-] 2 points by TrevorMnemonic (5827) 8 years ago

Yes. I find them more delusional than troubling.

Keep sharing the good information!

[-] 2 points by flip (7101) 8 years ago

again thanks

[-] 2 points by Puzzlin (2898) 8 years ago

We will not forget. The truth has a way of sticking.

[-] 2 points by TrevorMnemonic (5827) 8 years ago

Now I'm just commenting because the more comments this post gets the longer it stays at the top of the forum.

[-] 2 points by Puzzlin (2898) 8 years ago

I actually like that idea because not only does it work but personally I just happen to like to do it. This post has the aroma of truth of about it.

[-] 5 points by Puzzlin (2898) 8 years ago

Excellent post!!! This is what this movement started ON. Good job!!!

I will see you in streets my friend!!!

The Puzzler

[-] 3 points by Nevada1 (5843) 8 years ago
[-] 2 points by flip (7101) 8 years ago

i am with you - how about single payer - would solve many problems

[-] 1 points by Nevada1 (5843) 8 years ago


[-] 1 points by factsrfun (8231) from Phoenix, AZ 8 years ago

Well written post, I look at the 15.7% gain for college grads over 32 years and think that is very small, I wonder what the CEO compensation for the S&P 500 did over that time?

I might want to see more of Piketty's work can you "earn" off money you inherent?

I feel that if one looks at those with trust funds and those without, you get a pretty clear picture of the world, more so than thinking "middle class", a very good post, though thank you.

[-] 1 points by beautifulworld (23233) 8 years ago

Thanks, flip. Great post. Occupy Wall Street!

[-] 1 points by flip (7101) 8 years ago

you the man

[-] 1 points by beautifulworld (23233) 8 years ago

woman. LOL!

[-] 2 points by flip (7101) 8 years ago

i should have known - women are smarter than men sad to say but they have power - they need to figure out how to use it or we are doomed - does lysistrata come to mind?

[-] 1 points by beautifulworld (23233) 8 years ago

She's a bit extreme in her methods, but I get what you are saying. LOLOL!

[-] 1 points by flip (7101) 8 years ago

extreme? well there are many ways to solve the problem but my point is women have power and i hope they use it - average people have power and we have to use it - the power to say no is all we need - no i will not go to war - no i will not work in your factory. my wife just said "we have to invite beautiful world to our next party!"

[-] 1 points by beautifulworld (23233) 8 years ago

Sweet! Let me know when....

[-] 1 points by flip (7101) 8 years ago

maybe in may -we live in long branch - central nj on the ocean - we will have a fun house party - hockey players and artists - interesting crew

[-] 1 points by beautifulworld (23233) 8 years ago

Cool! :- )

[-] 1 points by Nevada1 (5843) 8 years ago

Hi flip, Thank you for post. Best Regards

[-] 1 points by flip (7101) 8 years ago


[-] 1 points by forjustice (178) from Kearney, NE 8 years ago

Keep Protesting Occupy!

Keep educating.

Quit supporting the 2 parties that support this Plutocracy.

[-] 1 points by flip (7101) 8 years ago

americans elect have a chance for making change?

[-] 1 points by forjustice (178) from Kearney, NE 8 years ago

From what I've seen no one is going to get enough votes on their site to get a nomination unless someone new declares.

AE is decent exposure for some lesser known candidates, but I believe when/if AE puts a candidate on the ballot it will be the one they want.

[-] 1 points by shoozTroll (17632) 8 years ago

This makes clear sense. Are you sure it's OK to post this here?



[-] -3 points by aflockofdoofi (-18) 8 years ago

Wow. Man bites dog it isnt. The intelligent, ambitious, and educated did better than the uneducated. Those with highly technical degrees did great.

You might think about getting engineering degrees or a degree in metallurgy than philosophy.

[-] 5 points by flip (7101) 8 years ago

Wall Street: fooled by randomness "If you're so rich, why aren't you so smart?" By Motley Fool Pick of the Day Jan 20, 2012 2:33PM

By Morgan Housel

In his book Fooled By Randomness, Nassim Nickolas Taleb describes "luck disguised and perceived as nonluck (that is, skill)." He explains: "It manifests itself in the shape of the lucky fool, defined as a person who benefited from a disproportionate share of luck but attributes his success to some other, generally very precise, reason."

[-] 0 points by TimSykes (-22) 8 years ago

Sounds to me like you don't understand the science and mathematics behind predicting the markets. So of course you attribute success in financial markets to luck, the real semantics of it are far too complex for your simplistic minds. It's ok, Champ, I guess I have been lucky for 12 years now.

[-] 2 points by GypsyKing (8706) 8 years ago

So you like to gamble with the wealth created by the work of others, and as long as you're winning, or at least bragging that you are, if others are homeless that's okay with you.

That's okay, at least we know where you stand and why you'll fall.

[-] 0 points by TimSykes (-22) 8 years ago

Actually, I trade at a proprietary trading firm, champ.

[-] 1 points by flip (7101) 8 years ago

sounds to me like you don't know nassem taleb - black swan come to mind - "the science and mathematics behind predicting the markets".- wow - you are fooled by randomness

[-] 3 points by TrevorMnemonic (5827) 8 years ago

You mean the people that pay taxes, do all the work when it comes to sales, and building the stores, and the same exact people that buy everything which is where the profits come from? Those people?

You might want to rethink your comment... Otherwise you just called yourself "less intelligent, less ambitious, and less educated."

Where the fuck would the "job creators" be if they didn't have slave labor in China making their products and didn't have people to sell and buy the products? NOWHERE.