Michael Norton published that rectangular graph in a study that also showed

Michael norton published that rectangular graph in a

This preview shows page 14 - 16 out of 20 pages.

Michael Norton published that rectangular graph, in a study that also showed that Americans really don't know how unequal the United States is — and that, given a blind choice, they'd rather live in Sweden, thank you very much. A blizzard of statistics illustrates the problem and, with each monthly release from the Census Bureau , the Bureau of Labor Statistics , or any number of think tanks, the pile of reports grows higher. Their by-now-familiar theme is that the rich have gotten richer — dramatically so — in recent decades, while the poor have gotten poorer. And the middle class has just been hanging on. Wages for Most Relatively Stagnant The details show that real wages for most U.S. workers have been relatively stagnant since the 1970s, while those for the top 1 percent have increased 156 percent, and those for the top 0.1 percent have increased 362 percent, according to a report by the Economic Policy Institute. Those trends resulted in the poorest 20 percent of Americans receiving just 3.6 percent of the national income in 2014, down from 5.7 percent in 1974. The upper 20 percent, meanwhile,
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received nearly half of U.S. income in 2014, up from about 40 percent in 1974, according to Census Bureau statistics. But some analysts, such as Hochschild and Piketty, the French economist, say the area of greatest concern is overall wealth, not income alone. "From a poverty perspective, income means a lot — making $15,000 versus $20,000," said Hochschild, who directs the HKS-based Multidisciplinary Program in Inequality and Social Policy . But "from an inequality perspective — writ large — it's about wealth. … As a '60s kid, I care a whole lot about ownership of the means of productivity." In his 2013 best-seller "Capital in the Twenty-First Century," Piketty argues that wealth is critically important because capital grows faster than the economy. That means that those who hold capital — assets like money, stocks, real estate — will see their wealth grow faster than those managing on wages alone. Over time, that concentrates society's wealth into fewer hands. America today appears to illustrate this process in action. Though the wealthiest 20 percent earned nearly half of all wages in 2014, they have more than 80 percent of the wealth. The wealth of the poorest 20 percent, as measured by net worth, is actually negative. If they sell all they own, they'll still be in debt. The widening wealth gap isn't just a problem for the poor, census figures show. The median net worth of some 60 percent of Americans fell between 2000 and 2011, while that of the upper 40 percent increased. So what happened? Tax rates for the wealthy have fallen, globalization has changed the world's and the nation's economies, and rapidly changing technology has transformed the workplace. While those factors are in play, Norton said that nothing's been proven yet as a dominant cause.
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