It’s been clear for some time that the economic recovery has been lopsided, benefiting the rich more than the poor. Now we have more hard numbers to back up that fact.
A new report from the Pew Research Center shows that, in 2013, the wealth gap between upper-income and middle-income families
was larger than at any point in the last 30 years for which we have data. The median net worth of upper income households was 6.6 times greater than that of middle-income families, up from 6.2 times in 2010 and
4.5 times in 2007, just before the financial crisis. The wealth gap between upper-income and lower-income Americans is even more staggering, at 70 times.
Pew classifies a family of four as upper income if its annual household income is at least $132,000. A middle-income family of the same size has an income of at least $44,000.
The center’s report comes days after another report by Pew pointed out that the gap between the wealth of white, black and Hispanic households has also become wider in recent years. Both reports are based on data from the Federal Reserve’s Survey of Consumer Finances, a respected source used by academic scholars.
There are many explanations for the growing wealth inequality in this country. Lower-income Americans were more likely to sell their houses, stocks and other investments than the rich to get through the recession. They were also more likely to be unemployed and struggle to find a job.
The Pew report shows that all income groups lost wealth from 2007 to 2010, but that the recovery has disproportionally benefitted the richest among us. Their median wealth increased to $639,400 in 2013, from $595,300 in 2010. By contrast, the wealth of middle-income households was stagnant at $96,500. (These numbers have been adjusted for inflation.)
For many Americans, this data will only confirm what they know to be true from looking at their bank accounts. But I suspect it will do little to silence critics of President Obama, who accuse him of engaging in “ class warfare” when he brings up inequality.
The plain truth is that inequality has gotten worse and that the wealthy have done pretty well under the Obama administration.