Time for change's Journal - Extravagant CEO Salaries and Ballooning Income Inequality in the U.S.

Time for change's Journal - Extravagant CEO Salaries and Ballooning Income Inequality in the U.S.
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Inside of Gabriel Thompson’s article is a graph titled “Plutocracy Reborn – Re-creating the Gap that Gave us the Great Depression”. Here it is:



This chart plots income inequality, measured as the ratio between the average income of the top 0.01% of U.S. families, compared to the bottom 90% (that would be most of us at DU). Note that preceding the great stock market crash of 1929, which plunged us into depression, the ratio rose from about 250 at the start of the 1920s to a peak of about 900 by 1929. The ratio then plunged, and by the start of WW II it had declined to about 200, where it remained with some relatively minor ups and downs until the beginning of Ronald Reagan’s Presidency. It then began another precipitous climb, with a sharp decline beginning during the last year of Clinton’s Presidency, but then another sharp increase beginning at about the time that the Bush tax cuts for the wealthy first went into effect, so that by the end of 2006 we’ve exceeded even the peak ratio of 1929 that preceded the Great Depression. The three green bars in the chart represent the stock market crash of 1929, the last pre-Reagan year, and two years preceding our current recession/depression.


Poverty

Consider the graph on page 11 of the U.S. Census Bureau publication, “Income Poverty and Health Insurance Coverage in the United States: 2006”. That graph shows that beginning with President Lyndon Johnson’s much maligned “War on Poverty” in the early ‘60s, poverty in the United States declined precipitously, from about 22% to 12%, before leveling off beginning around 1970. Then, with the onset of the “Reagan Revolution” starting in 1981, poverty began to rise again, reaching a maximum of about 15% twelve years later, just prior to the Clinton Presidency. The poverty rate then began a slow steady decline, to about 11% by the end of Clinton’s presidency, followed by another rise with the onset of the Bush II administration, to 12.3% by mid-year 2006. It then climbed to 12.5% in 2007 and 13.2% in 2008. However, that is not the end of the story, by any means. The current recession/depression will in all likelihood (and it’s probably already started) send another 5-10 million Americans into poverty, thus raising the poverty rate in our country another 1-4%.

These statistics are no accident. They are the result of federal legislation and policies meant either to help the poor or to help the wealthy. President Johnson’s “War on Poverty” reduced poverty substantially in our country. The only rises in poverty rate we’ve seen in our country since FDR’s New Deal (which decreased poverty) began with the Reagan and Bush II administrations, which are the only two presidential administrations since that time to substantially lower the top marginal tax rate, along with other fiscal policies that favor the wealthy at the expense of the poor and the working and middle class. ...