Rich getting richer: Campaign issue?
Studies show that the rich are getting a lot richer, the poor a little poorer. The middle class is slipping.
It's almost not news any more. The rich have been getting richer, and the middle class and poor are finding life more difficult economically.
The latest study of income inequality in the United States, released last week, confirms that trend. It finds that since the late 1990s, despite several years of reasonable economic growth, the bottom 20 percent of families actually lost 2.5 percent in their average income by 2005, while the top 20 percent of American households enjoyed a 9 percent rise. Those in the middle fifth got a 1 percent hike in inflation-adjusted incomes.
What makes the study noteworthy is that it raises further suspicion among many that the economic system isn't fair. Further, it suggests lower-income families are "ill prepared" to weather a recession, says Jared Bernstein, an economist at the liberal-leaning Economic Policy Institute (EPI) in Washington, and one author of the latest inequality study. (Most economic forecasters now say the US has probably slipped into recession.)
Using Census Bureau data, the study by EPI and the Center on Budget and Policy Priorities (CBPP), another Washington think tank, examined the situation in individual states. In 37 states, from the late 1980s to the middle of the current decade, the richest fifth of families got an average $36,300 boost in their annual income while the poorest fifth got just $1,600. In terms of purchasing power, the annual income of the poorest families increased only $93 by the end of the period (To see the study, visit www.cbpp.org.)