Here is a bit of information I stumbled upon. One of the things we hear about is how the top 1% have been the heavy beneficiaries of the modern economy. However, the stats I just spotted contradict this (yes the top 1% have benefited, but not as much as I assumed). In fact, the stats seem to indicate that it has been the top 20% that has benefited the most – at the expense of the bottom 80%.
Total Net Worth
Top 1 percent Next 19 percent Bottom 80 percent
1983 33.8% 47.5% 18.7%
1989 37.4% 46.2% 16.5%
1992 37.2% 46.6% 16.2%
1995 38.5% 45.4% 16.1%
1998 38.1% 45.3% 16.6%
2001 33.4% 51.0% 15.6%
2004 34.3% 50.3% 15.3%
2007 34.6% 50.5% 15.0%
2010 35.4% 53.5% 11.1%
Financial (Non-Home) Wealth
Top 1 percent Next 19 percent Bottom 80 percent
1983 42.9% 48.4% 8.7%
1989 46.9% 46.5% 6.6%
1992 45.6% 46.7% 7.7%
1995 47.2% 45.9% 7.0%
1998 47.3% 43.6% 9.1%
2001 39.7% 51.5% 8.7%
2004 42.2% 50.3% 7.5%
2007 42.7% 50.3% 7.0%
2010 42.1% 53.5% 4.7%
In fact, from 1983 through 2010, the top 1%’s non-home wealth actually FELL as a percentage of total net wealth of the country, while the top 20% non-home wealth rose dramatically.
What does this tell me, if it is indeed the case? Well, a few things leap to mind. First, the bottom 80% is aging, and is undoubtably using up their savings, such as they are, as they age. Second, I suggest that the economy is becoming increasingly high-tech, and those with average educations and average intelligence are finding it increasingly hard to compete in an open marketplace. Third, the bottom 80% had their savings largely in home equity, and the housing price crash killed off those savings.
And so the wealth is concentrating ever more in the hands of the more able and the better prepared. And I would expect that trend to accelerate.
So, is the answer to the nation’s ills the redistribution of wealth from the more able and better prepared to the less able and the less prepared? That does not seem like a workable answer – to punish those that do and can, and reward those that do not and cannot.
From 2009 to 2011, average real income per family grew modestly by 1.7% but the gains were very uneven. Top 1% incomes grew by 11.2% while bottom 99% incomes shrunk by 0.4%. Hence, the top 1% captured 121% of the income gains in the first two 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% income will likely surge, due to booming stock-prices, as well as re-timing of income to avoid the higher 2013 top tax rates. Bottom 99% will likely grow much more modestly than top 1% incomes from 2011 to 2012.
This suggests that the Great Recession has only depressed top income shares temporarily and will not undo any of the dramatic increase in top income shares that has taken place since the 1970s. Indeed, excluding realized capital gains, the top decile income share in 2011 is equal to 46.5%, the highest ever since 1917 when the series start.
Read more at http://globaleconomicanalysis.blogspot.com/2013/02/top-1-received-121-of-income-gains.html#Q0uK2ipVdVtTj0JL.99
Admin’s figures do not explain the growing wealth of the top twenty percent.
A lot of things are in play. Who are the top 1%? A few hundred are billionaires. A few thousand are megacorp execs. A few thousand are banksters. One and a half million of them are doctors, lawyers, small business folks, managers, etc.
So what is happening? Corps are certainly taking advantage of the situation to drive down wages. More and more Americans cannot compete on a world stage. Many Americans are retiring and their incomes are falling. Tax laws are resulting in no incentive to invest in the US. Incentive exists to take welfare and SsDi rather than work. Etc.
The 1% largely are not evil, but are just successful professionals and businesspeople. The top 20 percent are becoming relatively more wealthy than the bottom 80%. There is a reason for it. To me, ir means that those folks are better able to compete against global forces. And the others are not able to compete well. It will take enormous change tp government policy and American sense of entitlement to change this reality.
I think education is going to be the byword in the future. Manufacturing is moving from the West to the East and the far east, but labour problems are cropping up in China and India also. In India the workers are striking because they want to be paid as much as an engineer – about US$1500.00 a month.
There are engineers working on US$1000 in India. So if I am an industrialist I’d unwillingly pay the worker now, but will make plans for getting in robots to do a lot of things the worker would do. I’d replace 100 workers with robots and have 2-3 highly qualified engineers to monitor the assembly line. So basically the workers themselves are writing their own unemployed future.
Unless something really different happens, we will see a highly educated workforce getting to keep a major portion of the remuneration and an uneducated workforce just geting by. This could result in a number of those uneducated, but with specialized skills become small time entrepreneurs on the back of their hard work, creativity and other soft skills. This I see in the contractors and masons renovating my house.
The blue collar job operating the assembly line is dying slowly but surely.
LLPOH, Your numbers don’t necessarily show growing wealth of the top 20%. They show a growing SHARE of the wealth. That is, they are getting a bigger piece of the pie. My question — Is the pie growing or shrinking? If shrinking, then it could be said that the 80% are losing wealth at a higher rate than the top 20%.
Without the totals in $, we can’t ascertain whether the top 20% are actually benefiting or losing less.
Leobeer – astute question. I was planning to try to get an answer to that but have not had time.
I suspect wealth is falling in real terms, especially if real inflation and not the fake inflation Obama uses is factored in.
Leobeer- best I can tell, net wealth is currently increasing overall – estimated net wealth increased around 1.8% in 4th Q 2012, which would be greater than the official inflation rate. and maybe on par with the unofficial, real inflation rate.
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llpoh, I would like to suggest to you that the top 1% are beholden to the top 1/10th of 1%, which ultimately traces back to a few old world banking families and the new world industiralists since the turn of the 20th century, and let’s not forget the captains of silicon valley and lastly are the titans of wall street.
What you are calling successful are the whipping boys of the mega rich while the middle class is being hollowed out.
The system could be tweaked to be fair, but it is just the opposite where lobbyists control the votes in CONUS, instead of the people who pay their representatives salaries. Who will sell their souls for a vote to stay in power.
I suspect, LL, that you agree with freedom as long as it benefits you. The figures that you’ve quoted are symptoms of an unfair and unjust balance of power, which will be rendered just by the Almighty in due course, in case you haven’t read the Book of Revelations in the New Testament of the Holy Bible, pick your translation and version.
For what will it profit a man if he gains the whole world and forfeits his soul? Or what shall a man give in return for his soul? For the Son of Man is going to come with his angels in the glory of his Father, and then he will repay each person according to what he has done.
(Matthew 16:26-27 ESV)
After this I heard what seemed to be the loud voice of a great multitude in heaven, crying out,
“Hallelujah!
Salvation and glory and power belong to our God,
for his judgments are true and just;
for he has judged the great prostitute
who corrupted the earth with her immorality,
and has avenged on her the blood of his servants.”
(Revelation 19:1-2 ESV)
“Behold, I am coming soon, bringing my recompense with me, to repay each one for what he has done. I am the Alpha and the Omega, the first and the last, the beginning and the end.”
(Revelation 22:12-13 ESV)
He who testifies to these things says, “Surely I am coming soon.” Amen. Come, Lord Jesus!
The grace of the Lord Jesus be with all. Amen.
(Revelation 22:20-21 ESV)
because, if you confess with your mouth that Jesus is Lord and believe in your heart that God raised him from the dead, you will be saved. For with the heart one believes and is justified, and with the mouth one confesses and is saved.
(Romans 10:9-10 ESV)
If it was possible for man to save himself, then Jesus Christ would need not have died on the cross. Accept the free gift of God Almighty, eternal life.
Nonanonymous’ position is that doctors, lawyers, and small businessmen are the “whipping boys” of the mega rich. How flattering he is to those of us in that category. I agree re the lobbyists, and believe that paid lobbyist should be banned.
Of course I agree with freedom as long as it benefits me. What anidiotic statement. Freedom will ALWAYS benefit me, as it will benefit everyone.
I disagree that the figures are unfair. Why is it unfair that in an a free capitalist society, if I have natural skills, if I have spent years building up my education and skills, if I have worked long hours, if I have risked everything I own to start and run a business, that I earn a lot of money?
Why is it fair that I be forced to transfer any of my money, that I have earned, to people that have lesser talent, have made no effort to improve their education or skills, have made a decision not to work long and hard, and who have taken no risk? How is that fair?
The VAST majority of those in the 1% have done what described. Try being a doctor, lawyer, or successful small business peron without those things I have described.
I have no problem with people earning – emphasis on earning – as much as they are capable of, so long as it is done honestly and ethically. The vast majority of the 1% fall into this category.
That the bottom half or even 3/4 of society has not the skill, drive, foresight, ambition, work-ethic, etc. is no reason for me to be forced to give them money. It is a cold, cruel world. The bottom half need to have extreme work-thics and drive if they are to compete in a global marketplace and achieve some semblence of a modest lifestye. But hard work, foresight, ambition, and valuing education are not what they want. They want free-shit. I am opposed to giving it to them, as that means taking from those that are earning and worthy and giving to those that are not.
Fuck that.