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The Inequality Express "Every gun that is made, every warship launched, every rocket fired, signifies in the final sense a theft from those who hunger and are not fed, those who are cold and are not clothed." – (President Dwight D. Eisenhower, 1953). Between 1947 and 1970 all income groups in America experienced economic advancement. In fact, lower income families had higher growth in annual income than families of higher income. However, in the early 1970's this pattern changed. The higher income families, mostly within the top 20 percent income bracket, continued to increase there income, while families in the bottom 40 percent, experienced declining incomes. The difference in income between the lower income brackets and the higher income brackets, which continued through the mid-1990's, was due to a slowdown in productivity growth. Profits and wages depend largely on how much we produce, within approximately 35 years, productivity decreased and therefore there was less, which made the wages for the lower income brackets to go down. In approximately October of 1995, productivity began to increase, averaging 2.6 percent annual growth since then, and reaching an extremely high growth of 6.4 percent annual rate in the last quarter of 1999. For the workers that have been unemployed more then 6 months, dropped dramatically from almost two million in 1993 to just 637,000 As of September of 2000. “The unemployment rate of high-school dropouts declined from almost 12 percent in 1992 to less than 7 percent now. The unemployment rate among blacks is 7.3 percent, the lowest since the Bureau of Labor Statistics began compiling comparable unemployment data by race in 1972.” (George Akerloff, University California, Berkely, 2002.) 1.1 Distribution of Net Worth (by population segments) Wealth Class 1983 1989 1992 1995 1998 Top 1% 33.8 37.4 37.2 38.5 38.1 Next 4% 22.3 21.6 22.8 21.8 21.3 Next 5% 12.1 11.6 11.8 11.5 11.5 Next 10% 13.1 13.0 12.0 12.1 12.5 Next 20% 12.6 12.3 11.5 11.4 11.9 Middle 20% 5.2 4.8 4.4 4.5 4.5 Bottom 40% 0.9 -0.7 0.4 0.2 0.2 Source: Edward N. Wolff, "Recent Trends in Wealth Ownership, 1983-1998," April 2000. Table 2. Available on the website of the Jerome Levy Economics Institute at www.levy.org/docs/wrkpap/papers/300.html 1.2 Change in Average Household Net Worth by Wealth Class Source: Edward N. Wolff, "Recent Trends in Wealth Ownership, 1983-1998," April 2000. Table 3. http://www.levy.org/docs/wrkpap/papers/300.html 1.3 Household Net Worth by Wealth Class, 1998 Wealth Class Average Net Worth Threshold Top 1% $10,204,00 $3,352,100 Next 4% $1,441,000 Next 5% $623,500 $475,600 Next 10% $344,900 $257,700 Fourth 20% $161,300 Middle 20% $61,000 Bottom 40% $1,900 (Negative) Source: Edward N. Wolff, "Recent Trends in Wealth Ownership, 1983-1998," April 2000. Table 3 and note to Table 5. http://www.levy.org/docs/wrkpap/papers/300.html 1.4 Top 1% Share of Household Wealth Source: Edward Wolff, Top Heavy, 1996, New Series Households data, pp. 78-79 (for years 1922-89) and "Recent Trends in Wealth Ownership," April 2000, Table 2 (for years 1992-98) http://www.levy.org/docs/wrkpap/papers/300.html 1.5 Share of Total Ownership of Stocks, Mutual Funds, and Retirement Accounts, 1998 Source: Edward N. Wolff, "Recent Trends in Wealth Ownership, 1983-1998," April 2000. Table 6. http://www.levy.org/docs/wrkpap/papers/300.html 1.6 The Racial Wealth Gap, 1983-98 1983 1989 1992 1995 1998 Median Net Worth White $71,500 $84,900 $71,300 $65,200 $81,700 African-American $4,800 $2,200 $12,000 $7,900 $10,000 Hispanic $2,800 $1,800 $4,300 $5,300 $3,000 Median Financial Wealth White $19,900 $26,900 $21,900 $19,300 $37,600 African-American $0 $0 $200 $200 $1,200 Hispanic $0 $0 $0 $0 $0 Homeownership Rate White 68.1% 69.3% 69.0% 69.4% 71.8% African-American 44.3% 41.7% 48.5% 46.8% 46.3% Hispanic 32.6% 39.8% 43.1% 44.4% 44.2% Note: Financial Wealth is Net Worth minus the value of owner-occupied housing. Source: Edward N. Wolff, "Recent Trends in Wealth Ownership, 1983-1998," April 2000. Tables 8 and 9. http://www.levy.org/docs/wrkpap/papers/300.html 1.7 Richest Individuals and Families in the U.S., 2002 Name Net Worth Source Bill Gates $43 billion Microsoft Warren Buffett $36 billion Berksire Hathaway Paul Allen $21 billion Microsoft Alice Walton $19 billion Inheritance: Wal-Mart Helen Walton $19 billion Inheritance: Wal-Mart Jim Walton $19 billion Inheritance: Wal-Mart John Walton $19 billion Inheritance: Wal-Mart S.
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