Income Inequality Grows To Its Highest Level In 50 Years
Source: Associated Press
The gap between the haves and have-nots in the United States grew last year to its highest level in more than 50 years of tracking income inequality, according to U.S. Census Bureau figures released Thursday.
Income inequality in the United States expanded from 2017 to 2018, with several heartland states among the leaders of the increase, even though several wealthy coastal states still had the most inequality overall, according to the figures.
The nation's Gini Index, which measures income inequality, has been rising steadily over the past five decades. The Gini Index grew from 0.482 in 2017 to 0.485 last year, according to the bureau's one-year American Community Survey data. The Gini Index is on a scale of 0 to 1; a score of "0'' indicates perfect equality, while a score of 1 indicates perfect inequality, where one household has all the income.
The increase in income inequality comes as two Democratic presidential candidates, U.S. Sens. Bernie Sanders and Elizabeth Warren, are pitching a wealth tax on the nation's richest citizens as a way to reduce wealth disparities. -MORE...
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Last year areas with the most income inequality were coastal regions with large amounts of wealth — DC, New York and Connecticut — as well as areas with great poverty: Puerto Rico and Louisiana. Utah, Alaska, Iowa, North Dakota and South Dakota had the most economic equality.
Three of the states with the biggest gains in inequality from 2017 to 2018 were places with large pockets of wealth: California, Texas and Virginia. But the other six states were primarily in the heartland: Alabama, Arkansas, Kansas, Nebraska, New Hampshire and New Mexico.
Many factors were at play, from a slowdown in agricultural trade and manufacturing to wages that haven't caught up with other forms of income, economists say. While some states have raised the minimum wage, other states such as Kansas haven't.
Also, sustained economic growth from the recession a decade ago has enriched people who own stocks, property and other assets, and have sources of income other than wages. "We've had a period of sustained economic growth, and there are winners and losers. The winners tend to be at the top," Ginther said. "Even though we are at full employment, wages really haven't gone up much in the recovery."
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That's the real story. The rest of us are doing OK (or not) but we're still within a stone's throw of where we were in 1980 when Reagan took office. The humongous growth on the charts shows most of the wealth going to the super-wealthy class, and they're not sharing with anybody. Our US tax laws aren't helping either.
Our parents and grandparents all shared in that boom. Unions were strong then and unemployment was way down. That's the kind of growth we'd love to see again, but the Reagan boom was co-opted by the one-percenters. Nowadays the middle class is almost on life-support, and the next generation is ready to give up. My 12 year old grandson will face very different world than the one we Baby-boomers were handed.