A just-released study by UC Berkeley economics professor Emmanuel Saez has confirmed WRISEUP.COM’s worst fears about the concentration of wealth in the U.S. and its dire effects on the rest of the population.
Professor Saez traced the annual concentration of wealth in the hands of the top 0.01% of the U.S. population from 1913 to 2007
and reported that the figures for 2007 showed this concentration to be 20 percent higher than the previous record – set in 1929.
That previous record of five percent of total national income concentrated in the hands of the top 0.01 percent of the population crippled the mass market and triggered the global Great Depression of the Dirty Thirties that could only be ended with the launch of World War II, a war that cost close to 100 million lives.
The new record of six percent of total U.S. income concentrated in the hands of the top 0.01 percent in 2007 triggered the current global recession-cum-depression. And that concentration of wealth has likely increased in the past two years.
But while the mainstream politicians and economists and the corporate mass media are all singing the same tune that this recession is over, the simple reality is that it is far from over. We are nowhere near bottom yet!
A close examination of Professor Saezès annual figures shows that it took a 33-year decline in that concentration of wealth – from 1941 to 1974 – a achieve the greatest overall economic prosperity in either U.S. or world history.
By 1974, the decline in the concentration of wealth in the hands of the top 0.01 percent of U.S. population from over five percent of total national income in 1929 to less than one percent produced the greatest mass prosperity in the history of the world.
Since 1978, it has been all uphill not only for the top 0.01% but for the entire top five percent of the U.S. population and all downhill for the bottom 80 percent.
And the figures are probably quite similar here in Canada where 30 years of successive NeoLiberal and NeoConservative government have strived mightily to make Canadaès economy a tiny mirror-image of that of the U.S.
But letès get back to the figures. In 1977, the average per capita income of the top 0.01% of Americans was $27.7 million, or approximately 644 times the average income of the bottom 99.99%. But that 99.99%, of course, includes almost all of the top five percent who have also all been on the gravy train for the past 30 years.
In starker terms, the average income of the top 0.1 percent of Americans in 2007 was more than 5,500 times as much as the average income of the bottom 0.01%.
Does anyone deserve to make 5,500 times as much as anyone else!
Until the extreme concentration of wealth in the hands of the top five percent of North Americans is drastically redressed, there will be no end to the current global economic chaos. There may be occasional blips as government stimulus money flows, but until the U.S. and Canadian governments have the balls to take the bull of extreme wealth concentration by the horns there will be no real, lasting economic recovery.