INCOME GAP IN US

Income Gap in US



Income Gap in US

In today's world people want to be healthy, happy and well educated and most want to own some type of capital. They also want to be well paid for the work that they do and they prefer to pay as little tax as possible. While everybody is happier when the rate of inflation is low and when the economy is growing and everyone is getting better off. In booming economic times, such as we recently have enjoyed, the only problem is that "the rich get richer and the poor get poorer." Because company profits have been down but the head executives are still getting all the perks, like, stock options, and bonuses that's capitalism and that is the American dream. Poverty is a problem the government has been trying to fix. Many welfare programs help the poor, whom are individuals who lack food, shelter, and clothing, with food stamps, and assistance for both transportation and childcare. From 1996 to recent years the policies on welfare reform have become more stringent on receiving benefits, the government has been working harder on training and placing individuals in the work force.

The income gap between the top 10 percent and the bottom 90 percent has reached “a level higher than any other year since 1917 and even surpasses 1928, the peak of the stock market bubble in the 'roaring' 1920s,” according to an analysis of the data published earlier this month by University of California economist Emmanuel Saez.( Porty, 1998)

The figures released by the IRS are from 2007. They indicate that for most of the top 10 percent (families with incomes of $110,000 or more), there was little change in terms of income growth and share, but the top 1 percent increased their share of the national income to 23.5 percent, compared with 22.8 percent in 2006. Between 2002 and 2006, this social layer, consisting of one out of 100 American households, accounted for 65 percent of income growth nationwide. This trend has held for the better part of the past decade. During the period 2002-2007, the top one percent saw an annual growth in income of just over 10 percent annually. During the same period, the bottom 99 percent saw an increase of only 1.3 percent per year, falling well below the rate of inflation. As a result, the top one percent accounted for two thirds of income growth over the six-year period.( Beeghley, 2004)

Bringing this income stratification into still sharper focus provides a staggering indication of the concentration of wealth in the US. The top .01 percent of the population, (less than 15,000 families) saw its share of total income rise from 5.46 percent in 2006 to 6.04 percent in 2007 (compared to just 0.9 percent in 1979). This 2007 figure amounts to roughly double the total combined income for the bottom 20 percent, some 30 million families. The problem of the poorest of the population is that the fact that they don't ...