Reprinted from Smirking Chimp
Income Inequality and the Lack of Economic Mobility Threaten the American Dream
(Image by The Film Archives, Channel: thefilmarchives) Permission Details DMCA
Economic inequality inspired Occupy Wall Street, a movement that in a few short months transformed our political with the concept of the "1 percent" and the "99 percent." Today the presidential candidacy of Bernie Sanders is altering the political landscape with a call to reduce inequality.
Why does this theme resonate with so many voters? How does it intersect with other issues like social justice, national security and the environment? Is inequality irreversible?
We are living through the greatest "wealth grab" in history. But inequality is not produced by immutable forces. It's the result of a legislative agenda promoted by the rich and executed by their political allies. The struggle to change this agenda and end inequality is inseparable from the other critical struggles of our time.
What follows are 10 facts about the 1 percent -- but they're not just statistics. They're a paint-by-numbers picture of an economy, and a democracy, in urgent need of change.
1. Not so long ago, growth and prosperity were more widely shared in this country.
There was a time in living memory when the growth in American productivity was shared much more broadly than it is today.
As economist John Schmitt wrote in 2013, "From the end of World War II through 1968, the wages for workers in the middle, and even the minimum wage, tracked productivity closely."
This led to the growth of a middle class whose members could meet their own needs, afford some luxuries, and raise and educate their children -- often on a single working person's income.
While many people, especially people of color, were shamefully excluded from this prosperity, the postwar American experience shows us that it is possible to promote broadly shared economic growth.
2. Then something changed.
But then, as Schmitt observes, something changed. Increases in prosperity were no longer being shared in the same way. He writes:
"Between 1979 and 2012, after accounting for inflation, the productivity of the average American worker increased about 85 percent. Over the same period, the inflation-adjusted wage of the median worker rose only about 6 percent, and the value of the minimum wage fell 21 percent. As a country, we got richer, but workers in the middle saw little of the gains, and workers at the bottom actually fell behind."
If the national minimum wage had kept pace with productivity, says Schmitt, it would have been $22 per hour by 2013.
Instead it's $7.25 today.
A slightly more conservative calculation from economist Dean Baker said the minimum wage would have been $18.42 per hour in 2015 had it kept pace with productivity. This graph illustrates the broadening of this gap: