Analysis Shows Top 1% Gained $21 Trillion in Wealth Since 1989 While Bottom Half Lost $900 Billion
By TruePublica: Adding to the mountain of statistical evidence showing the severity of U.S. inequality, an analysis published last Friday found that the top one per cent of Americans gained $21 trillion in wealth since 1989 while the bottom 50 per cent lost $900 billion. However, the UK is on the same path says Nobel prize-winning economist.
In the USA, Matt Bruenig, founder of the left-wing think tank People’s Policy Project, broke down the Federal Reserve’s newly released “Distributive Financial Accounts” data series and found that, overall, “the top one per cent owns nearly $30 trillion of assets while the bottom half owns less than nothing, meaning they have more debts than they have assets.”
The growth of wealth inequality over the past 30 years, Bruenig found, is “eye-popping.”
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“Between 1989 and 2018, the top one per cent increased its total net worth by $21 trillion. The bottom 50 per cent actually saw its net worth decrease by $900 billion over the same period.”
“Enormous crisis,” Rep. Pramila Jayapal (D-Wash.) tweeted in response to Bruenig’s analysis. “We have the worst inequality in this country since the 1920s,” wrote Jayapal, co-chair of the Congressional Progressive Caucus. “Just three of the wealthiest people in America have as much wealth as the bottom 50 per cent.”
US versus EU
The level of income inequality has been stable over time in both the U.S. and the EU. But in the U.S., inequality is consistently about 50 per cent higher than in the EU
US versus UK
Rising inequality in Britain risks putting the country on the same path as the US to become one of the most unequal nations on earth, according to a Nobel-prize winning economist.
Sir Angus Deaton is leading a landmark review of inequality in the UK amid fears that the country is at a tipping point due to a decade of stagnant pay growth for British workers. The Institute for Fiscal Studies thinktank, which is working with Deaton on the study, said the British-born economist would “point to the risk of the UK following the US” which has extreme inequality levels in pay, wealth and health.
“There’s a real question about whether democratic capitalism is working when it’s only working for part of the population.
Deaton said geographical inequality appeared to be a factor in the UK, with London benefiting disproportionately compared with other parts of the country.
“People really feel that not everybody is having a fair crack anymore.”
Pay for non-college-educated men has not risen for five decades, while mortality for less-educated white men and women in middle age has led to average life expectancy to fall for the past three years, something that has not happened for a century.
According to the IFS paper, the richest 1% in Britain have seen the share of household income they receive almost triple in the last four decades, rising from 3% in the 1970s to about 8%. Average chief executive pay at FTSE 100 firms has risen to 145 times that of the average worker, from 47 times as recently as 1998.
Earnings in the lowest-earning working households have barely risen since the mid-1990s, compared with greater increases for higher-income groups.