Society and Economy
Growing Inequalities a Historic Crisis

One Percenters' Income Nearly Tripled In Last Three Decades: CBO The last 30 years have been very good to the rich.

COMMENTARY

Peter Burgess

One Percenters' Income Nearly Tripled In Last Three Decades: CBO The last 30 years have been very good to the rich.

Income for the wealthiest Americans has nearly tripled since 1979, while remaining relatively stable for the rest of the country, according to figures released this week by the Congressional Budget Office. The numbers offer a striking illustration -- the latest one in a long series -- of how wide the gap has grown between America's richest citizens and everyone else.

For the richest 1 percent of Americans, income rose a full 275 percent between 1979 and 2007, -- accounting for inflation -- according to the CBO.

For the poorest 20 percent of Americans, meanwhile, income rose just 18 percent in the same time period.

For the middle 60 percent of earners -- that is, the 21st through 80th percentile -- income grew by just under 40 percent. And for the 80th through 99th percentile, income grew by 65 percent. That's a rapid climb, but the top 1 percent experienced a rate of growth more than four times as fast.

Above all else, the CBO's figures suggest that the richer you are, the richer you'll get over time. But this is far from the first report to reach that conclusion: Numerous studies have shown that America's very highest earners have been steadily pulling away from the rest of the population for a generation.

Even as income for the richest 1 percent has nearly tripled since 1979, wages for the lower and middle classes have hardly moved -- a phenomenon that roughly coincides with the decline in union participation in recent decades, as Think Progress noted. Paul Krugman, the Nobel-winning economist and left-leaning New York Times columnist, describes this phenomenon as the 'Great Divergence.'

Today, the 400 richest people in the country control more wealth than the bottom 50 percent of households, and the U.S. ranks roughly alongside countries like Uganda, Cameroon, Ecuador and Rwanda in terms of the gap between its poorest and wealthiest citizens.

Such a pronounced degree of income inequality is likely holding back the economic recovery, according to the International Monetary Fund -- thereby prolonging the misery for millions who are out of work, and the record 46.2 million people who are currently living in poverty.

The gap separating the richest 1 percent of Americans from the rest of the country has emerged as arguably the single most prominent rallying cry of the Occupy Wall Street movement, which began last month in New York City's Zuccotti Park and has since expanded to hundreds of protests around the country and sister demonstrations across six continents.

The Occupy protesters identify themselves as 'the 99 percent' -- referring to the majority of the population that has had to contend with limited economic and social opportunities while money continues to accrue to the very wealthiest citizens.