Did you catch the latest figures on income inequality in America? Think Progress summarizes renowned economist Emmanuel Saez’s latest research, which found that the richest 1% of Americans captured 121% of income gains during the recovery. (Link updated.)
121 percent? Sounds like a mathematical impossibility, or at least Onion-like hyperbole.
But as it turns out…
How is it possible for the 1 percent to capture more than all of the nation’s income gains? The number is due to the fact that those at the bottom saw their incomes drop. As Timothy Noah explained in the New Republic, “the one percent didn’t just gobble up all of the recovery during 2010 and 2011; it put the 99 percent back into recession.”
In addition to issues of fairness, these studies point at another, deeper implication: Income inequality begets further economic woes. Which begets more income inequality. Which…. well, you get the point.
Here in Oregon, the Center for Public Policy points to our tax structure as one of the ways that income inequality in Oregon perseveres. (Check out their recent article, “Oregon’s Tax System: Poor and Middle Pay More than Rich.”)