Wealth inequality in America worse than you think it is

This video on wealth inequality in the U.S. has gone viral within days, and for good reason. It painstakingly goes through several graphics to get across some basic, staggering facts about who owns America.

The data used in the video is from 2007. Data from 2010 show that it’s getting even worse. There has been a 4% shift in the distribution curve from poorer to wealthier. The top 10% of the population own 77% of wealth (up from 73%), and the bottom 90% own 23% of wealth (down from 27%).

Net worth and financial wealth distribution in the U.S. in 2010 (Source: Wolff, E. N., The Asset Price Meltdown and the Wealth of the Middle Class, New York: New York Univ., 2012)
Net worth and financial wealth distribution in the U.S. in 2010 (Source: E.N. Wolff, The Asset Price Meltdown and the Wealth of the Middle Class, NY: NYU, 2012)

If you want some really in-depth numbers, including the jaw-dropping racial disparities, see this article by G. William Domhoff of the University of California, Santa Cruz. The bottom line: “Since financial wealth is what counts as far as the control of income-producing assets, we can say that just 10% of the people own the United States of America.”

The video is not only presents the facts so we can “get” them but points out the gap between reality and perception. We get that things are skewed. Yet we so vastly underestimate the extent of wealth inequality that you have to wonder whether the myth of a classless America is so impermeable and right-wing propaganda so relentless, that we simply can’t see what is staring us in the face.

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Tax the corporations, tax the uber-wealthy

Photo by Lisa Norwood

It’s tax day, 2012! As you press the key to electronically file your taxes, or make the frenzied trip to the post office as I did, let’s contemplate another year when Congress wailed over the country’s debt yet failed to tax corporations and the super-rich.

This just in: Senate Republicans blocked the proposed minimum tax on top earners known as the Buffett Rule. No surprises there.

Common Dreams has two good articles addressing the plight of the rich in America. “Five Reasons Why The Very Rich Have NOT Earned Their Money” gives you some facts to back up what you intuitively know: American workers aren’t losing ground because they’re lazy.

So workers have TRIPLED their productivity over 30 years while the richest 1% have TRIPLED their share of income. Worker pay remained flat as the top 10% took almost all the productivity gains since 1980.

Tax victimhood is the refuge of the rich. Titans of entrepreneurship are carrying average American leeches on the back of their tax burdens, right? Well, no.

Real tax rates for the richest Americans have gone way down over the last 30 years, from 34% in 1980 to 23% in 2006. Yet the 1% claim they pay most of the taxes. They don’t, if all taxes are considered. Based on recent data from the Center on Budget and Policy Priorities, the total of all state and local taxes, social security taxes, and excise taxes (gasoline, alcohol, tobacco) consumes 22% of the annual incomes of the poorest quintile. For the top 1% of Americans, the same taxes consume less than 10% of their incomes.

In “The Rich Are Different from You and Me – They Pay Less Taxes,” Bill Moyers gives us the straight story on corporate profits and gluttonous CEO’s:

In a story headlined, “For Big Companies, Life Is Good,” The Wall Street Journal reports that big American companies have emerged from the deepest recession since World War II more profitable than ever: flush with cash, less burdened by debt, and with a greater share of the country’s income. But, the paper notes, “Many of the 1.1 million jobs the big companies added since 2007 were outside the U.S. So, too, was much of the $1.2 trillion added to corporate treasuries.”

To add to this embarrassment of riches, the consumer group Citizens for Tax Justice reports that more than two dozen major corporations  – including GE, Boeing, Mattel and Verizon — paid no federal taxes between 2008 and 2011. They got a corporate tax break that was broadly supported by Republicans and Democrats alike.

Last year, among the 100 best-paid CEOs, the median income was more than $14 million, compared with the average annual American salary of $45,230. Combined, this happy hundred executives pulled down more than two billion dollars.

Also not to be missed: The Nation features a slide show of “Ten CEOs Who Tax-Dodged Their Way to Riches.”

The 1 Percent isn’t a figment of the 99 Percent’s imagination.