THE FACTS ARE A LITTLE DEPRESSING
The United States is approaching a level of inequality on par with the Great Depression, according to a paper by economists Emmanuel Saez and Gabriel Zucman.
In their paper, “Exploding wealth inequality in the United States”, the pair found that the wealth share of the top 0.1% of Americans rose greatly in recent decades, but eroded among the middle class and the poor.
DEBT IS THE CULPRIT
According to Saez and Zucman, increased debt is the main reason the bottom 90% of American families are struggling to get ahead.
The top 1% saw their wages grow fast, while wage gains were limited for the bottom 90% of families.
The result is that the share of wealth amongst the top 0.1% was almost equal to the bottom 90%.
PICKETTY MAY BE ONTO SOMETHING
French economist, Thomas Picketty, is onto something.
Saez and Zucman mention Picketty’s book, Capital in the Twenty-First Century, which argues income inequality is growing because of capitalism, and proposes a global system of wealth taxes to reduce world inequality.
There’s such a buzz about the book, it was voted Business Book of the Year by The Financial Times and McKinsey this week.