from the Working Life blog:
Rich V. The Rest: Greatest Divide Ever And Will Get Worse (NEW DATA)
by Jonathan Tasini
Tuesday 29 of March, 2011
No one should be surprised that the rich are doing quite well. We've lived through at least a thirty-year robbery of the wealth of the nation. But, it's worth digging into some of the numbers to get to this point: the divide between the rich and the rest of us has never been this bad--and it will get worse.
The new light shed on this robbery comes from Sylvia A. Allegretto, an economist and deputy chair of the Center on Wage and Employment Dynamics at the Institute for Research on Labor and Employment, University of California, Berkeley, and a research associate of the Economic Policy Institute. In an in-depth study, Allegretto looked at the wealth of Americans--which has been devastated by the housing collapse and the financial crisis
First, so we're operating on the same page, what is wealth?:
The definition of net worth, also referred to as wealth, is the sum of all assets minus the sum of all liabilities. Assets include items such as real estate, bank account balances, stock holdings, retirement funds (such as 401(k) plans), and individual retirement accounts (IRAs). Liabilities include mortgages, credit card debt, outstanding medical bills, and student loan debt. Net worth excludes assets in defined-benefit pension plans because workers do not legally own the assets held in these plans and thus do not necessarily benefit or suffer from gains or losses in the value of assets used to pay the defined benefits. For similar reasons, this analysis also excludes Social Security and Medicare from net worth calculations. But given the very low levels of wealth owned by the households in the bottom of the wealth distribution in the United States, the implicit wealth provided to them by defined-benefit pension plans and Social Security is absolutely crucial to their ability to achieve acceptable living standards during their retirement years.
It isn't as if we lived in an equal society before the recent financial crisis. But, it has gotten significantly worse:
Since 1983 the top 5% of wealth holders consistently held more than 50% of all wealth, but the share increased from 56.1% in 1983 to 63.5% in 2009. The bottom 80% of wealth holders consistently held less than 20% of all wealth, but the share declined from 18.7% in 1983 to 12.8% in 2009.
.............(more)
The complete piece is at:
http://www.workinglife.org/blogs/view_post.php?content_id=15140
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