Over at The American Prospect’s blog, Ezra Klein takes a closer look at U.S. economy growth. In 2004, the economy grew by a respectable 2.4%, but real income growth was as follows:
- Richest 1%: 12.5%
- Everyone else: 1.5%
Klein observes:
In fact, it’s no longer just the middle class and the poor who’re falling behind. The distribution has grown so uneven that the 95th percentile is making meager headway — even the merely rich are falling behind. It’s the richest of the rich making headway. But they now account for so much wealth and holdings that their acceleration can effortlessly outweigh everyone else’s deterioration. Add in that the reliable income growth conveyors of yesterday, like education and hours worked, no longer heavily correlate with income increases (earnings dropped for college graduates in 2004) and you’ve got a real problem on your hands…