Emmanuel Saez from UC Berkeley has released his latest report on inequality and it reminds me that I need to finish off my last three installments of Joseph Stiglitz. I'll have Part Eight up sometime next week, perfectly timed as well as the title of that chapter is "The Battle of the Budget."
Saez's latest report has quite a bit of useful information, including...
Top 1% incomes grew by
31.4% while bottom 99% incomes grew only by 0.4% from 2009 to 2012.
Hence, the top 1% captured 95% of the income gains in the first three years
of the recovery. From 2009 to 2010, top 1% grew fast and then stagnated
from 2010 to 2011. Bottom 99% stagnated both from 2009 to 2010 and from
2010 to 2011. In 2012, top 1% incomes increased sharply by 19.6% while
bottom 99% incomes grew only by 1.0%.
So, what does all this mean?
Top 1% incomes are close to
full recovery while bottom 99% incomes have hardly started to recover.
Shocking, I know:)
Saez notes that after the Great Depression, there were policy changes that reduced this income concentration. Today, however, there have been none. Again, I'm shocked.
On page seven, the data shows that during the Clinton administration, the wealthy did quite well, increasing their income by 98 percent! Yet, so did the 99 percent, who saw their income increase by 20 percent. Now, take a look at the Bush Years. It's apparent that the policy changes under his administration favored the wealthy and even then, underperfomed compared to Bill Clinton. The collapse of 2008 seems to have permanently stagnated the income of 99 percent of Americans.
We simply can't have an economy like this. Two thirds of our economy is consumer spending and there just aren't enough people spending. They don't have any extra money.
So, what do we do now? Well, any policy changes are going to be nearly impossible to pass with the Republicans hell bent on the president failing. They certainly don't want any successes on his watch as that would really drive home the contrast between the utter failure of George W. Bush and any potential gains under Barack Obama. In fact, our economy is doing mildly better and that's just about all they can tolerate as they still have to have something negative to caterwaul about.
In some ways, I hope that we elect a moderate Republican so he or she can do all the things that Barack Obama was not allowed to do because of adolescent temper tantrums.