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[h=2]Another Study Proves That Only the Richest Are Gaining Income From Economic Growth[/h]MARK KARLIN, EDITOR OF BUZZFLASH AT TRUTHOUT
(Photo: david_shankbone)
It has become almost a mantra on BuzzFlash to note that 95 percent of the income gains since the crash of 2008 have gone to the top 1 percent of the US population.
BuzzFlash and Truthout are accountable to our readers, not big business or billionaire sponsors. Will you make a tax-deductible donation now to sustain independent journalism?
A September 26 column by New York Times economic writer Neil Irwin, "The Benefits of Economic Expansions Are Increasingly Going to the Richest Americans," once again validates this statistic. However, the lopsided flow of income gains to the wealthiest people is even more inequitable than we have learned thus far, according to a new study that Irwin sites:
Who benefits from rising incomes in an expansion has changed drastically over the last 60 years. Pavlina R. Tcherneva, an economist at Bard College, created a chart that vividly shows how. (The chart appears in print in the Fall 2014 edition of the Journal of Post Keynesian Economics, in her article “Reorienting fiscal policy: A bottom-up approach.”)
Back in the 1940s, '50s and '60s, most of the income gains experienced during expansions — the periods from the trough of one recession until the onset of another — accrued to most of the people. That is to say, the bottom 90 percent of earners captured at least a majority of the rise in income.
With each expansion in sequence, however, the bottom 90 percent captured a smaller share of income gains and the top 10 percent captured more.
Since 2008, the disproportionate growth in money flowing to the top 10 and 1 percent has exponentially increased - and the wages of the bottom 90 percent of the population have, in general, either fallen or stagnated.
This has created, according to Irwin, an astonishing statistic:
But in the first three years of the current expansion, incomes actually fell [according to the Tcherneva data] for the bottom 90 percent of earners, even as they rose nicely for the top 10 percent. The result: The top 10 percent captured an impossible-seeming 116 percent of income gains during that span. [Italics inserted by BuzzFlash.]
In short, as 90 percent of the US population loses ground, 10 percent - and particularly the top 1 percent - are actually drawing in more than 100 percent of the economic gains since 2008. This is due to adjusting figures to reflect the decrease in income for 90 percent of earners in the US.
Irwin concludes his analysis of the most recent study by reconfirming the snowballing economic inequity of the current financial structure in the US:
But this much is clear: Recessions are bad enough; everyone understands that they will tend to be times of stagnant or falling incomes. What is remarkable about the patterns of the last half-century is the steady march toward expansions that also do less and less to build up the incomes of most Americans.
Given the evidence cited in the analysis, the last paragraph of Irwin's article is a dramatic understatement. It is more accurate to state that this country's distribution of earnings and wealth has regressed at an accelerating pace, devolving into a feudal system.
It has become almost a mantra on BuzzFlash to note that 95 percent of the income gains since the crash of 2008 have gone to the top 1 percent of the US population.
BuzzFlash and Truthout are accountable to our readers, not big business or billionaire sponsors. Will you make a tax-deductible donation now to sustain independent journalism?
A September 26 column by New York Times economic writer Neil Irwin, "The Benefits of Economic Expansions Are Increasingly Going to the Richest Americans," once again validates this statistic. However, the lopsided flow of income gains to the wealthiest people is even more inequitable than we have learned thus far, according to a new study that Irwin sites:
Who benefits from rising incomes in an expansion has changed drastically over the last 60 years. Pavlina R. Tcherneva, an economist at Bard College, created a chart that vividly shows how. (The chart appears in print in the Fall 2014 edition of the Journal of Post Keynesian Economics, in her article “Reorienting fiscal policy: A bottom-up approach.”)
Back in the 1940s, '50s and '60s, most of the income gains experienced during expansions — the periods from the trough of one recession until the onset of another — accrued to most of the people. That is to say, the bottom 90 percent of earners captured at least a majority of the rise in income.
With each expansion in sequence, however, the bottom 90 percent captured a smaller share of income gains and the top 10 percent captured more.
Since 2008, the disproportionate growth in money flowing to the top 10 and 1 percent has exponentially increased - and the wages of the bottom 90 percent of the population have, in general, either fallen or stagnated.
This has created, according to Irwin, an astonishing statistic:
But in the first three years of the current expansion, incomes actually fell [according to the Tcherneva data] for the bottom 90 percent of earners, even as they rose nicely for the top 10 percent. The result: The top 10 percent captured an impossible-seeming 116 percent of income gains during that span. [Italics inserted by BuzzFlash.]
In short, as 90 percent of the US population loses ground, 10 percent - and particularly the top 1 percent - are actually drawing in more than 100 percent of the economic gains since 2008. This is due to adjusting figures to reflect the decrease in income for 90 percent of earners in the US.
Irwin concludes his analysis of the most recent study by reconfirming the snowballing economic inequity of the current financial structure in the US:
But this much is clear: Recessions are bad enough; everyone understands that they will tend to be times of stagnant or falling incomes. What is remarkable about the patterns of the last half-century is the steady march toward expansions that also do less and less to build up the incomes of most Americans.
Given the evidence cited in the analysis, the last paragraph of Irwin's article is a dramatic understatement. It is more accurate to state that this country's distribution of earnings and wealth has regressed at an accelerating pace, devolving into a feudal system.
