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Is the US system rigged for the rich?

While the poor get social programs worth $365 billion, the rich get more. Subsidies to help the prosperous build wealth added up to $384 billion last year.

Income inequality in America is the worst it has been since 1928. Wealth-building subsidies, income tax relief, ballooning CEO salaries, and other factors contribute to the growing imbalance. This cartoon first ran in the Christian Science Monitor on Sept. 28, 2003.

Clay Bennett / The Christian Science Monitor / File

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Everybody knows the rich are getting richer, but why they're getting richer remains something of a mystery. Is the system biased?

The shift of income to the top has occurred in the most prosperous English-speaking nations, such as Australia, Britain, and Canada. But it has been most pronounced in the United States. Thirty years ago, the richest 1 percent of Americans got 9 percent of total national income. By 2007, they had 23 percent. Last year, new census data show, the rich-poor income gap was the widest on record.

Wealth is more unevenly distributed. The top 20 percent of wealth-holders own 84 percent of America's wealth. What's causing it?

One factor is federal policy, says a study by the Corporation for Enterprise Development (CFED) and the Annie E. Casey Foundation. It finds that most federal subsidies aimed at building wealth, such as certain tax deductions (officially called "expenditures"), credits, and preferential rates, go to the richest taxpayers.

Of course, many government programs aim to alleviate poverty. Those with low incomes get Medicaid, food stamps, welfare, etc., adding up to about $365 billion. But Uncle Sam's subsidies for building wealth – of little use to the poor – were even larger: $384 billion last year.


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