Wednesday, September 9, 2009

Let Them Eat Cake


I want to shed some "lyte" on income distribution. Are you one among the top 1% of American households? Then congratulations, you did very well under the Bush administration. Thanks to his tax cuts and his administration's blatant favoritism towards big businesses and the people who own them, two-thirds of the nation's total income gains from 2001 to 2007 went to you.

This data comes from a large analysis of IRS data done by two economists. We haven't seen such income disparity since 1928. Can someone remind me what happened in 1929? Oh yeah, the Great Depression. Do you think it is merely coincidence that similar income gaps preceded our Great Recession? Hmmm.....

The top 1% did well, but the top of the top did even better. The top one-tenth of the top 1% saw their income increase by 94%. This even surpasses gains made during 1928. It is off the charts.

Did the Great Recession touch these households? How do you define touch? I doubt they had to make significant changes to their lifestyles. I doubt they are in foreclosure, or have had to declare bankruptcy. And the sad thing is, they stand to gain the most when the economy recovers. Only large-scale changes in public policy, like the New Deal, help to even the scales.

This income disparity has been in evidence since 1976. Until then, the bottom 90% gained income at a higher percentage than the top 1%. And the scary thing is, this is IRS data. Do you really think that the top 1% have claimed all of their income? Is it possible that they could afford really expensive accountants, have offshore accounts, and other vehicles to hide their money? Say it ain't so.

So, I guess there is only one thing to do. Eat the rich.

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