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| THE WALKING DEAD |
The average family income in the United States overall rose
4 percent from 2010 to 2013 after falling 7 percent during the recession.
When adjusted for inflation, the average real income for the
top 20 percent of Americans rose 10 percent from 2010 to 2013. Real income for
the 40 percent below that, the ‘middle class’ and ‘upper middle class’, barely
budged, meaning they didn’t recover the losses they’d experienced during the
recession. The poorest people, the bottom 20 percent, not only didn’t make up
their losses from the recession, they continued to lose ground.
The Pew Research Center issued a report titled “The American
Middle Class is Losing Ground: No Longer the Majority and Falling Behind
Financially.” It found that 49 percent of total income in the U.S. in 2014 went
to households in the upper-income tier, up significantly from 29 percent in
1970. Forty-three percent of income in the U.S. went to middle-income
households, down significantly from 62 percent in 1970.
One significant factor underlying the widening gap between
the rich and others is a simple economic fact: The more resources you have, the
more wealth you’re able to generate for yourself. In common parliance, money
makes money and the rich get richer.
Income may have taken a dip during hard economic times, as
it did for even wealthy Americans during the Great Recession, but when things
start to improve, companies begin to gear up again, stocks and other
investments start to rise, and real estate prices recover. The Americans who
own such assets benefit from this, recovering faster than those who don’t. People
in the lowest income levels who are living paycheck to paycheck — if they have
a full-time job — find it difficult to save, let alone invest. For the ‘middle
class’, a home has often been their biggest asset, which is why the middle
class was hit particularly hard by the housing crash.
The richest 400 Americans have more wealth than the bottom
50 percent of Americans, and the wealthiest 1 percent own 42 percent of private
assets. Since 2000, the median weekly earnings of full-time wage and salary
earners dropped until they are lower than they were 40 years ago. The ranks of
the working poor have exploded. Ninety percent of all Americans are getting
poorer day by day, while rich families are becoming an in-grained aristocracy.
The American Dream was an opiate to soothe the masses while the
rich rigged the system. In the case of the United States, Canada, France, and
Germany, for example, much of the recent growth in personal wealth (more than
20%) is attributable to capital equity growth alone. There was no real value
created here, just paper money for the most part. But paper money is power all
the same.
A century ago, at the time of the First World War, the
richest 20% of the world’s population earned eleven times more than the poorest
20%. By the end of the twentieth century they earned seventy-four times as
much. When it comes to wealth, rather than income, the picture is more extreme.
Globally, the richest 1% now own nearly half of all the world’s wealth. The
poorest 50% of the world, by contrast—fully 3 billion people—own less than 1%
of its wealth.
Total global wealth was estimated at $263 trillion in
mid-2014, up from $117 trillion in 2000. That was the same year that the world
agreed to bind itself to achieving the Millennium Development Goals by 2015
(with the headline ambition of halving the proportion of people living on less
than $1.25 a day). Those goals end this year, in 2015, in many cases not having
been met. Meanwhile, global wealth keeps on growing: by 8.3% from mid-2013 to
mid-2014 alone.
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