Fw: Income Gap Widens For U.S. Families/ EPI and CBPP

Michael Pugliese debsian at pacbell.net
Mon Jan 17 23:11:29 PST 2000

> Income Gap Widens for U.S. Families
> By SHANNON McCAFFREY Associated Press Writer
> WASHINGTON (AP) -- The boom on Wall Street is widening
> the income gap between the poorest and richest U.S.
> families, according to a report by two Washington
> think tanks.
> The earnings for the poorest fifth of American
> families rose less than 1 percent between 1988 and
> 1998 but jumped 15 percent for the richest fifth, the
> Center on Budget and Policy Priorities and the
> Economic Policy Institute said in their report issued
> Tuesday.
> Income for the poorest families -- defined as two or
> more relatives living together -- rose $110 to $12,990
> during the 10-year period. For the richest families it
> increased by $17,870, to $137,480, more than 10 times
> that of the poorest sector, the report found.
> ``The benefits of this (economic) growth have not been
> evenly distributed,'' said Elizabeth McNichol, one of
> the study's authors. ``The incomes of the poor and
> middle class have fallen or stagnated.''
> McNichol attributed the widening gap to Wall Street's
> long-running bull market, which favors wealthy
> investors; lower-paying service jobs replacing
> manufacturing jobs; and the largely stagnant minimum
> wage.
> The gap between rich and poor was widest in New York,
> with the poorest fifth earning $10,770, down $1,970,
> while the wealthiest group earned $152,350, up
> $19,680. Income was most evenly distributed in Utah,
> where the poorest families had incomes of $18,170 and
> the richest $125,930.
> The income gap narrowed in just three states --
> Alaska, Louisiana and Tennessee.
> Stephen Moore, director of social policy for the Cato
> Institute, said the study contorted data to put a
> negative face on a ``spectacular economy.''
> ``The rich are getting richer but the poor are getting
> richer too in this expansion,'' said Moore, who
> nonetheless suggested cutting the tax on capital gains
> income to further spur investment and job creation.
> The income gap has made its way into presidential
> politics. Last weekend, Arizona Sen. John McCain
> lashed out at the tax plan of his Republican rival,
> Texas Gov. George W. Bush, saying it would do nothing
> to alleviate the widening gap between the ``haves and
> the have-nots.'' The Bush campaign countered that
> McCain was engaging in ``class warfare.''
> Democrats Al Gore and Bill Bradley also have talked
> about the need to ensure that the nation's poorest
> residents aren't left behind by the booming economy.
> McNichol said increasing the minimum wage would help
> bridge the gap. Ten states and the District of
> Columbia currently have minimum wages above the $5.15
> national rate. The Senate last year passed a $1
> minimum wage increase over three years but the House
> failed to act on the measure.
> McNichol also suggested strengthening states' and
> social safety net programs for low-income workers,
> such as providing transportation and child care.
> The Center on Budget and Policy Priorities and the
> Economic Policy Institute are nonprofit, nonpartisan
> organizations pushing for changes in tax laws and
> other federal policies to benefit low-and
> moderate-income families.
> The study used before-tax data from the U.S. Census
> Bureau. The figures were adjusted for inflation.
> AP-NY-01-18-00 0002EST

More information about the lbo-talk mailing list