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Monday, August 9, 2010

US income Inequality at an all time high

Huffington Post | Hallie Seegal First Posted: 08- 9-10 01:19 PM | Updated: 08- 9-10 03:19 PM
The Republican American Dream is a snow job!

The American Dream may in fact be slipping away. The white picket fence, Social Security, and sending your children to college has become increasingly hard to achieve.

The harsh reality for today's middle class is that many of them go to work just to get by. Arianna Huffington's new book, "Third World America", sheds light on many of the crucial ways in which it has been short-changed.

From our failing education system to the runaway greed of the financial services sector, America's middle class is facing on onslaught from all sides.

Below, we've compiled eight surprising and disturbing facts about America's shrinking middle class from Arianna's book:

Income Inquality Is Soaring

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In 2005, the bottom 20 percent of household earners had an average income of $10,655 while households in the top 20 percent made nearly 160,000 – a disparity of 1,500 percent, the highest gap ever recorded, Arianna notes in Third World America.



This chart, from UC-Berkley professor Emmanuel Saez, shows income inequality is at an all-time high.

How can this income disparity be explained?


Ronald Reagan was president from 1981-1989 and Reaganomics resulted in big tax cuts for the affluent. George HW Bush was president from 1990-1993.


Clinton was president from 1994-2001 and started reversing the trend by increasing taxes on the most affluent Americans, but he faced a hostile Republican congress after the first two years of his presidency.


Bush's base was the 'have mores' and he reduced income tax for the affluent, cut the capital gains tax to 15 per cent and suspended the Estate Tax making the distribution of income worse than it was prior to the Great Depression.

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