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Income Inequality in the USA

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John Hunter

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The Great Wealth Transfer by Paul Krugman

The widening gulf between workers and executives is part of a stunning increase in inequality throughout the U.S. economy during the past thirty years.
…
The share of income received by the top 0.1 percent of Americans is twice the share received by the corresponding group in Britain, and three times the share in France. These days, to find societies as unequal as the United States you have to look beyond the advanced world, to Latin America.

This article obviously is strongly against the rising inequality. The article can go perhaps too far in some claims but overall is a worthwhile read on an important topic. My opinion is that too much income inequality is a danger sign for an economy. I also strongly appose huge inherited wealth and obscene CEO pay. But people doing well for themselves is not necessarily bad. The USA is better off for having Warren Buffett, Larry Page, Micheal Dell, Sergey Brin, Jeff Bezos… and I see nothing wrong with them amassing large sums. See more articles on the topic:

Income inequality from the Economist – “The evidence is mixed, at best, as to whether inequality depresses economic growth. Though it certainly can breed discontent, particularly if some people feel that they are being shut out of the American dream.”
The Rich Get (Much) Richer, Business Week:

Economists Thomas Piketty and Emmanuel Saez calculated (using data from the Internal Revenue Service, hardly a hotbed of partisanship) that the share of income going to the top 1% of households nearly doubled, to 14.7% in 2002, up from a low of 7.7% in the early 1970s. By comparison, the income share for the top 1% peaked at 19.6% in 1928 before beginning its long slide. What is particularly alarming is that at every step up the ladder, the disparity has progressively widened. Over the past 30 years, the share of income garnered by the top 10% of Americans has grown by about a third; the share of the top 0.01% — the 13,000 or so households with an average income of $10.8 million in 2002 — has multiplied nearly four times

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One response to “Income Inequality in the USA”

  1. Taxes – Slightly or Steeply Progressive? at Curious Cat Investing and Economics Blog

    […] seem to ignore that income inequality has drastically increased. When you have a system that puts a huge percentage of the cash in a few people’s pockets of […]

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