Two important events took place this week. One was the President's call for a higher minimum wage, which got a lot of attention. The other was a new report which showed just how much of our nation's wealth continues to be hijacked by the wealthiest among us.
That didn't get much attention.
There's a Great Robbery underway, although most of its perpetrators don't see themselves as robbers. Instead they're sustained by delusions that protect them from facing the consequences of their own actions.
Heads I Win ...
An updated report from economist Emmanuel Saez details the loss of income suffered by 99 percent of Americans, and the parallel gains made by the wealthiest among us. Its most startling finding may be this: The top 1 percent has captured 121 percent of the increases in income since the worst of the financial crisis, while the rest of the country has continued to fall behind.
If you thought the rich recovered from the crisis just fine but everybody else got the short end of the stick, relax: You're not crazy. And since the financial crisis was caused by members of the 1 percent -- not all of them, of course, just the ones we spent so much to rescue -- it's understandable if the injustice still rankles you.
You rescued them. Now they're drinking your milkshake.
Tails You Lose
But this wealth shift is not a new phenomenon. As Saez notes in his paper, "After decades of stability ... the top decile share has increased dramatically over the last twenty-five years." In fact, the top 10 percent's share of our national income is higher than it's been since 1917 -- and maybe longer. (The figures don't go back any farther than that.)
Although it began during the Reagan years, to a certain extent this wealth shift has been a bipartisan phenomenon. During the Clinton boom years (more of a bubble, actually; Dean Baker has the details) the top 1 percent saw their real income grow by 98.7 percent, while the other 99 saw a smaller increase of 20.3 percent. They lost more during the recession that followed -- a little over 30 percent, versus 6.5 percent for everyone else -- but more than made up the difference again during the Bush years.
The same thing happened after the Great Recession: The top 1 percent lost more during the initial shock, but they're rapidly making up the difference now. (Meanwhile, underwater homeowners still don't have the help they need.)
The disparities are even greater when you include capital gains. And Saez uses pre-tax income for his figures, so the after-tax differences could be even greater, with generous tax breaks for capital gains and the many loopholes used by the wealthy.
There's even economic injustice at the top. Gains for the one percent have far outstripped those of the top five and top 10 percent. As the old song says: Them that has, gets.
If you can remember the sixties you weren't there ... or can't afford to remember
The minimum wage has been falling since 1968. As John Schmitt notes in his paper, "The Minimum Wage Is Too Damn Low," "By all of the most commonly used benchmarks -- inflation, average wages, and productivity -- the minimum wage is now far below its historical level."