Soaring unemployment has poured salt into a long-festering economic wound – the widening gap between rich and poor Americans, a trend that has been accompanied by a hollowing out of the middle class.
One unimpeachable view of this wage gap comes from a Federal Reserve report that examined the period leading up to the housing bust and recession, and noted that “income became more ‘unequally’ distributed over the 1988-2006 period.”
A more provocative analysis emerges from research co-written by UC Berkeley economist Emmanuel Saez.
After studying Internal Revenue Service records since 1913, Saez found that the fraction of total income reported by the top 1 percent of tax filers peaked at 23.94 percent in 1928.
Thereafter, income for this elite group fell for decades, only to rise from the 1980s through 2007, when this top strata took in 23.5 percent of all reported income.