The Rich Get Richer…and You Know the RestBy
The gap between rich and poor in the U.S. is the widest on record, according to the latest data released by the U.S. Census Bureau. The data, collected in 2009 and early 2010, show the broad impact of the recession, from falling household income and rising poverty levels to reduced birth rates and delayed marriage.
Last year, the top 20 percent of households—those taking home more than $100,000 a year—received 49.4 percent of all household income. The bottom 20 percent—those earning less than $20,000—received 3.4 percent. The top earners' share is up from 49 percent in 2008, while the bottom earner's share fell from 3.6 percent. The ratio of earnings between the top and bottom is almost double what it was when the Census Bureau began tracking in 1967.
Median household income fell 2.9 percent nationwide, from $51,726 to $50,221. Income rose in only one state, North Dakota. The share of Americans below the poverty line (roughly $22,000 for a household of four) rose from 13.2 to 14.3 percent, the highest rate since 1994. Now 43.6 million Americans are living in poverty, the most in the 51 years the Census estimates have been published.
The portrait of growing ranks of poor and a squeezed middle class comes a month before midterm elections and amid a debate between President Barack Obama and Republicans over the status of the Bush-era tax cuts. "It shows that there are still people struggling in the low- and middle-income brackets," says Elaine Maag, a research associate at the nonpartisan Tax Policy Center. "That might be a reason why we would extend the expanded child tax credit [and] the earned-income tax credit assistance" in the Bush tax cuts.
Obama wants to extend tax cuts enacted under President George W. Bush for households earning less than $250,000 and allow them to expire for those above. Most Republicans want to extend the cuts for all income groups.
The bottom line: Amid a heated debate over expiring tax cuts, new Census data show that income inequality is widening.