Shocking FACTS about U.S. income & wealth inequality

Tue, 13 Feb 2001

From: fightback9955@my-deja.com

After 8 years of a genuinely sociopathic "New Democrat" as President of the United States the appalling inequality of income and wealth that was exacerbated under the Republican President Reagan actually WORSENED.

At a time when the top 1% of U.S. citizens owns more wealth than the bottom 95% the new U.S. President wants to further cut the taxes of that wealthiest 1% while vast numbers of the bottom 95% live paycheck- to-paycheck and owe enormous credit card debts.

Whether Democrat or Republican, whether Gore or Bush, the result is the same: the U.S. is damn close to becoming a Third World nation. Perhaps if more poor people in Honduras, the Philippines, India or other Third World countries had credit cards they, too -- like so many heavily-indebted Americans -- would delude themselves that they were "well-off".

The fact is that tax rate for the wealthiest Americans was 88% in the two decades following World War II, a time when the U.S. economy was booming. Working-class and middle-class Americans saved more and charged less then, too.

What follows are some disturbing facts (from www.inequality.org) about just how far from a fair economy we've come, notwithstanding the joint Dem-GOP deceitful propaganda that claims most Americans are "better-off" nowadays:

* Since the mid-1970s, the most fortunate one percent of households have doubled their share of the national wealth. They now hold more wealth than the bottom 95 percent of the population. (Shifting Fortunes)

* In 1998, 18.7 percent of American children lived in poverty, a lower rate than 1993 (19.6 percent), but higher than the 1979 rate of 16.4 percent. (Columbia University, http://cpmcnet.columbia.edu/dept/nccp/)

* Nine states have reduced child poverty rates by more than 30% since 1993. These states include Tennessee, Michigan, Aransas, South Carolina, Mississippi, Kentucky, Illinois and New Jersey. Michigan is a prime example of a national trend, in that even the recent, dramatic improvement did not counter the losses of the previous 15 years, in which its poverty rate increased 121%. (Columbia University)

* In California, the number of children living in poverty has grown from 900,000 in 1979, to 2.15 million in 1998. (Columbia University)

* Nearly 3 percent of all workers live under the federal poverty line, defined in 1998 as $13,003 for a family of three. Counting dependents, this encompasses roughly 5 million people.(The Conference Board, contact Linda Barrington, 212-339-0481)

* In 1998, the top 1 percent of stock owners owned 47.7 percent of all stock, while the bottom 80 percent owned 4.1 percent. Between 1989 and 1998, nearly 35 percent of all stock market gains went to the top 1 percent of shareholders. 64 percent of American households have stock holdings worth $5,000 or less, or own no stock at all. (Economic Policy Institute)

* Between 1995 and 1998, the total wealth of the typical American household rose from $58,800 to $61,000. The average value of stock holdings rose $5,500, the value of non-stock assets (mostly homes) climbed $8,500, and household debt increased $11,800. (Economic Policy Institute)

* Middle-class families enjoyed 2.8 percent of the stock market gains between 1989 and 1998, but accounted for 38.8 percent of the increase in household debt. (Economic Policy Institute)

* In 1998, 62.9 percent of private sector workers had employer-provided healthcare, down from 63.1 percent in 1989. 49.2 percent of private sector workers have employer-provided pension plans. (Economic Policy Institute)

* 60 percent of U.S. workers say that if they were laid off, their savings are sufficient to maintain their current standard of living for a few months or less. Only 29 percent said they are able to save for the future. 40 percent say they earn enough to be comfortable, but not to save, while 27 percent said they earn only enough to get by, and 3 percent said they are unable to pay their bills. (Fleet Bank, contact Rena DeSisto, 212-703-1961)

* 64 percent of U.S. workers say they would rather have more time than more money. Even in households earning less than $25,000, 49 percent said they would still prefer time over money. (Fleet Bank)

* Fewer than 43,000 estates -- 2 percent of the total -- paid federal estate taxes in 1997. (Money, 9/2000)

* In 2000, the federal estate tax is expected to raise $27 billion, more than double the amount of federal income taxes paid by the bottom half of all taxpayers. (United For a Fair Economy, http://www.ufenet.org/activist/action_alert/Estate_Tax_Talking_Points.ht ml)

* A study by Treasury Department economist David Joulfaian found that eliminating the estate tax would reduce charitable bequests by about 12 percent. (United For a Fair Economy)

* While the top tax rate is 55 percent, on average, estate taxes represent 17 percent of the gross value of the estate. (United For a Fair Economy)

* More than 2.5 million households have investable assets of more than $1 million, up from 2 million households in 1995. (Time, 12/14/98)

* As a result of stock-market gains, the most affluent 25-30 percent of American households) are about 20 times wealthier, on average, than they were in 1989. (New York Times, 9/20/98)

* Among the industrialized nations, the U.S. has the highest concentration of individual wealth--roughly 3 times that of the No. 2 nation, Germany. (UN Human Development Report, 1998)

* As of 1997, the richest five percent of U.S. households held more than 60 percent of the nation's private wealth. The top 1 percent of households held 40 percent of the wealth. (Edward Wolff, relying on data from the Federal Reserve Survey of Consumer Finances)

* Between 1983 and 1995, the average net worth of households in the bottom 40 percent of the population declined by 80 percent, from $4,400 to $900. The net worth of the middle fifth of the population declined by 11 percent. (Shifting Fortunes, Edward Wolff)

* Most Americans in the highest-earning one percent of the population (median annual income: $330,000) don't consider themselves rich. (Worth- Roper Starch Survey)

* The inflation-adjusted net worth of the median household fell from $54,600 in 1989 to $49,900 in 1997. In nearly one out of five households, debts exceed assets. Household debt as a percentage of personal income rose from 58 percent in 1973 to an estimated 85 percent in 1997. (Chuck Collins, Betsy Leondar-Wright, Holly Sklar, Shifting Fortunes)

* As of 1995, 40 percent of American households owned stock either directly or through a mutual fund or some sort of retirement plan. Almost 90 percent of the value of all stocks and mutual funds was held by 10 percent of the households. (Federal Reserve Survey of Consumer Finances)

* Between 1983 and 1995, only the highest-earning five percent of households saw an increase in their financial net worth. By 1995, the bottom 40 percent of families headed by those between the ages of 25-54 had no savings. The middle quintile of income-earners (the middle class) have enough savings to sustain their standard of living for 1.2 months, down from 3.6 months in 1989. (Federal Reserve data as analyzed by Edward Wolff)

* Between 1983 and '89, the net worth of American citizens grew by $5 trillion. About 54 percent of that new wealth went to the half-million families who make up the top one-half of one percent of the population. Federal Reserve and IRS data confirm that the net worth of the top 1 percent of Americans now dwarfs that of the bottom 90 percent--the most extreme wealth concentration since the 1920s. (Jeff Gates, "An Ownership Solution")

* The likelihood of facing an Internal Revenue Service audit if you earned more than $100,000 last year: 1.03 percent. In 1988, the audit rate was 11.4 percent for such taxpayers. Now their chance of being audited is smaller than that of taxpayers earning less than $25,000 a year; their rate is 1.5 percent. (The New York Times, April 16, 2000)

* The Gini coefficient is a complex statistical measure of inequality; a 0 coefficient is perfect equality (everyone has the same share), while a 1 coefficient is total inequality (one person has everything). In 1997, the United States had a Gini coefficient of 0.375, up from 0.323 in 1973. The 1997 figure is higher than any other "wealthy" country. Britain's is 0.346, Germany's 0.300, Canada's 0.286 and Sweden's 0.222. However, these figures relate to income, and Alan Greenspan points out that when applied to consumption, the Gini number for the U.S. falls by about 25 percent. In other words, the poor are more likely to own the same televisions, washing machines, etc., as the rich, than income figures might suggest. (Fortune, 9/4/00)

* 5.4 million Americans live in substandard housing or spend more than half their income on rent. (Fortune, 9/4/00)

* Income inequality declined from the late 1930s through the '60s. In the 1920s, the richest five percent of American families received about 30 percent of the nation's personal income. That share had decreased to 17.5 percent of income by 1947, and to 15.6 percent by 1969, according to the Census Bureau (whose figures underestimate high incomes by, among other things, excluding capital gains). After a brief period of stability, inequality began widening in the late '70s. The income share going to the richest five percent of families reached 17.9 percent in 1989, 20.3 percent in 1996. The richest one-half of 1 percent of American taxpayers now account for more than 11 percent of aggregate income. In recent years, only college graduates, about a quarter of the work force, have racked up significant wage gains. (Frank Levy, "The New Dollars and Dreams: American Incomes and Economic Change")

* From 1989 to 1999, real compensation for the average CEO rose 62.7 percent. The ratio of CEO pay to average worker pay stands at 107:1. In 1989, it was 56:1.(Economic Policy Institute)

* Since 1979, the average income of the highest-earning one percent of Americans has increased by roughly 80 percent, while the income of the highest-earning 20 percent has increased by 18 percent. The bottom 60 percent of the population has experienced a decrease in real income. (Shifting Fortunes)

* In 1973, the combined income of the highest-earning 20 percent of American families was 7.5 times that of the bottom 20 percent. By 1996, the multiple was 13. (Census Bureau)

* In 1998, the average American worker's inflation-adjusted weekly wages were 12 percent below what they had been in 1973. (Collins, Leondar-Wright and Sklar, Shifting Fortunes)

* In 1947, children were slightly less likely than adults to be poor. Now the reverse is true. (Frank Levy) The official poverty rate among children is about twenty percent. Among adults, it's twelve percent. (New York Times, 1/4/99)

* Although the wage gap has moderated slightly in the last few years, over-all income differences continue to widen, due to the impact of stock market gains. Americans with taxable incomes above $200,000 may only constitute a tenth of a percent of the population, but they accounted for 18.1 of the household income reported in 1996, up from 14.6 percent in 1994. In 1997, that share increased again, to 19.9 percent. (New York Times, 2/28/99)

* Among chief executives of the biggest U.S. corporations, the median increase in overall compensation was about 10 percent last year, up from 25 percent in 1997, according to Graef Crystal. Corporate profits, meanwhile, rose 5 percent, and factory employees' pay, 2.6 percent. (New York Times, 4/4/99)

* With stock options factored in, the average CEO of a major U.S. corporation made $7.8 million in 1997, up from $5.8 million in 1996. (Business Week, 4/20/98)

* The average CEO makes 728 times more than a minimum wage worker. If the minimum wage had risen at the same rate as executive pay over the last three daces, it would stand at nearly $41 an hour as opposed to $5.15. (Institute for Policy Studies/United for a Fair Economy, April 23, 1998)

* As a result of the merger between Chrysler and Daimler Benz, Chrysler chairman Robert Eaton will get $69.9 million in cash and stocks, and options worth another $239 million. In 1997, Daimler chairman Juergen Schrempp took home $2.5 million, while Eaton made $16 million, though Schrempp ran a larger and more profitable company. (United for a Fair Economy)

* Since 1986, Bill Gates has been earning money at the rate of roughly $650,000 an hour. If there were such a thing as a $500 bill, it would not be worth Mr. Gates' while to take the time (circa 4 four seconds) to bend down and pick one up off the ground. (Bill Gates Net Worth Page).

* The average wage of a Silicon Valley software engineer was $95,800 in 1998, the most recent year for which the data is available. In the largest of all employment categories, "local and visitor services" (including retail and restaurant workers), the average wage was $22,9000. (The New York Times, Jan. 10, 2000).

Health Patterns

Infant Mortality

* Eight American infants die for every 1,000 who are born. The infant mortality rate for African-Americans is twice as high: 15.8 deaths per 1,000 live births. (Childrens Defense Fund)

* The only OECD nations with higher rates of infant mortality are Hungary, Korea, Mexico, Poland, and Turkey. In 1994, 31,710 U.S. babies died. Fifteen thousand of them would have survived if our infant mortality rate was equal to Japan's. (Childrens Defense Fund) Life Expectancy

* The United States spends more on medical care--13.6 percent of gross domestic product--than any other advanced industrialized society. Yet among the 29 OECD nations, we rank 21st in life expectancy. (Childrens Defense Fund) The average life expectancy for white Americans is 76.8 years. For black Americans, it stands at 70.2 years (Department of Human Services Health United States Report, 1998)

* Death rates in the most economically divided metropolitan areas--such as Pine Bluff, Ark., an Mobile, Ala.--are sharply higher than the national annual average of 850 deaths per 100,000 people. The increase in mortality--an extra 140 deaths per 100,000 people--is equivalent to the combined loss of life from lung cancer, diabetes, motor vehicle accidents, HIV, infection, suicide and homicide during 1995. (Lynch J.W., Kaplan G.A., Pamuk E.R., et al. "Income inequality and mortality in metropolitan areas of the United States," American Journal of Public Health 1998)

The Uninsured

* Roughly forty-three million Americans--one sixth of the population-- have no health insurance. In 1990, the figure was 32 million. (Knight- Ridder 2/19/99)

* Eighteen percent of workers between 18 and 64 were uninsured in 1997-- an increase of 15.7 percent over 1990. Sixty-nine percent of white workers were covered by employer-sponsored insurance, compared with 52 percent of African American workers and 44 percent of Latino workers. (Sacramento Bee)

* One in four American workers has no access to employment-based health insurance coverage at any price. (General Accounting Office, Feb 1997, Employment-Based Health Insurance Costs)

* About ten million children are uninsured. In 1996, 70 percent of all Americans added to the ranks of the uninsured were children. (Census Bureau)