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Top 1% got 121% of all income gains during

Posted: Mar 13, 2013

Only the richest get richer in this recovery

New research shows most families got dinged financially from 2009 to 2011, with one notable exception: The top 1%.

By Aimee Picchi Feb 13, 2013 3:02PM

The economy is still recovering from the recession, and it's come a long way since 2008, when the housing market was dire and the stock market took a nosedive.

But new economic research indicates that the recovery hasn't benefited the average American family -- unless your family is part of the country's new elite. Only the top 1% saw average real income growth between 2009 to 2011, according to a Berkeley economist. (By the way, to break into to the top 1%, you'll need an annual income of at least $366,623,according to the World Top Incomes Database.)

For the rest of us in the 99% bracket, family incomes slipped by 0.4% from 2009 to 2011, according to Emmanuel Saez, the University of California, Berkeley, economist whose earlier research documented a three-decade run-up in income for America's top 1%.

The recovery is treating the top 1% much better, however. That group saw incomes gain 11.2% during the first two years of the recovery, according to Saez, who was named a MacArthur Fellow in 2010 for his research into income and tax policy.

But doesn't a rising tide lift all boats? Saez says it's not happening in this recovery. "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," he wrote in the January report. "Bottom 99% will likely grow much more modestly than top 1% incomes from 2011 to 2012."

Astoundingly, Saez writes that his new research shows that the top 1% grabbed 121% of the income gains in the first two years of the recovery. How does that work? In essence, it means that the gains of the top 1% came at the expense of the remaining 99%.

The research may give a boost to President Obama's proposals outlined in his State of the Union speech on Tuesday. Taking a progressive stance, his address included ideas such as raising the minimum wage to $9 an hour.

That might not be enough to appease Saez, who last year told The New York Times he advocates much higher top marginal tax rates on the rich -- up to as much as 90%."

Me: 90%! Yes, we went as high as 90% for a long time, through the Ozzie and Harriet and Happy Days eras, and all prospered, including a healthy wealthy class. What was different was that we grew a large middle class, shrank the poor class, and said NO to growing a billionaire class.

From the linked NY Times article on the same guy, "Emmanuel Saez and Thomas Piketty have spent the last decade tracking the incomes of the poor, the middle class and the rich in countries across the world. More than anything else, their work shows that the top earners in the United States have taken a bigger and bigger share of overall income over the last three decades, with inequality nearly as acute as it was before the Great Depression." Note, these are the same 3 decades of our downward skid I keep mentioning. You know, the "we have to take care of business so it'll take care of us" and "big business good, regulation bad" backslide decades.

A dem

;

Because it is an assault on the middle class - sm

[ In Reply To ..]
always has been an assault on the middle class..wait for the daily riots in the streets..remember seeing a show on how the middle class would be obliterated 30 years ago when I was in high school..We are about 20 years behind the mark but right on target to what this documentary showed..

This statement says it all. - Des

[ In Reply To ..]
"In essence, it means that the gains of the top 1% came at the expense of the remaining 99%."

Ryan's Class War on Behalf of the Rich - doe

[ In Reply To ..]
Please see link for full article:

"Ryan's plan starts, like all good GOP deficit reduction plans, with a giant tax cut. Specifically, he wants to replace the current progressive rate structure with a two-rate structure — 10 percent and 25 percent. If you're currently an individual paying a 39.6 percent marginal tax rate on your income over $400,000, that's an enormous tax cut. If you're currently an individual paying a 25 percent marginal tax rate on your income of $70,000 a year you may wonder what's in it for you here. The answer is, most likely, higher taxes."

Both he and Rand were running for 2016 this week - essentially promising to make it worse. nm

[ In Reply To ..]
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