WEALTH DISTRIBUTION
TRUE OR FALSE:
IN THE US …
THE RICH ARE GETTING RICHER.
THE POOR ARE GETTING POORER.
FROM THE UN:
THE HUMAN POVERTY INDEX (HPI)
FOR RICH COUNTRIES RANKS
COUNTRIES ACCORDING TO THEIR
NATIONAL LEVELS OF POVERTY,
ILLITERACY, UNEMPLOYMENT, AND
LIFE EXPECTANCY.
SWEDEN COMES IN AT THE TOP WHILE
THE US FINISHES LAST. THE REPORT
NOTES THAT SWEDEN, DESPITE A LOWER
PER CAPAITA INCOME THAN THE US,
HAS, ON AVERAGE, MORE ADULTS WHO
ARE FUNCTIONALLY LITERATE AND
FEWER LIVING IN POVERTY. THIS INDEX
SHOWS THAT EVEN IN MIDDLE OR HIGH
INCOME COUNTRIES, INEQUITY PERSIST.
HEALTH INSURANCE


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The number of Americans without health
insurance climbed by 33% during the
1990s.
The biggest indicator of a healthy society –
longevity – has dropped from 11th in the
world 20 years ago to 42nd by 2007.
Infant mortality has climbed (Cuba has
greater rates of child survival than does
the US).
The “Gini Coefficient” measures
concentration of wealth. It is an
index that goes from 0 to 1,
1 being the most unequal.
Wealth inequality in the US measures
.82, pretty much the highest level of
inequality you can have.
Economist Edward Wolff,
New York University
WEALTH
OWNERSHIP
IN THE
UNITED STATES…
The bottom 20% basically
have zero wealth.
They either have no assets,
or their debts equal or
exceed their assets.
The middle class has “liquid”
assets: checking accts,
CDs, or pensions.
Such assets make up 84%
of their wealth…
…while the richest 1% own
about 85% of all financial
securities and 90% of
all business assets.
We are much more unequal than any other
advanced industrial country.
Perhaps our closest rival in terms of
inequality is Great Britain. But where the top
percent in this country owns 38 percent of all
wealth, in Great Britain it is more like 22 or
23 percent.
This was not always the case. Up until the
early 1970s, the U.S. actually had lower
wealth inequality than Great Britain.
But things have really turned around in Great
Britain over the last 25 or 30 years. In
fact, a lot of countries have experienced
lessening wealth inequality over time. The
U.S. is atypical in that inequality has risen
so sharply over the last 25 or 30 years.
The Merrill Lynch/Capgemini report predicts
continued good times for the wealthy around
the globe in coming years, powered by rising
stock markets, growth in emerging markets
like China and India, and the broader
economic recovery. The number of ultrahigh-net-worth individuals is expected to
grow 7% a year during the next few years,
the report says, and the total global wealth
of financial millionaires is expected to hit
$40.7 trillion by 2008,
up from $28.8 trillion in 2003.
Combined, “Forbes 400” (wealthiest
400 people in our country) wealth
totaled more than $1.1 trillion – an
amount greater than the gross
domestic product of Spain or
Canada, the world’s 8th and 9th
largest economies.
CEO SALARIES
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CEOs running 100 of the USA's biggest
companies pulled in median 2002
compensation of $33.4 million
CEO salaries and bonuses surged 15% in a
year; salaries for rank-and-file workers
averaged 3.2% gains
More than 90% of CEOs received fresh
stock-option grants, with a median
potential value of $23.2 million
Home Depot Severance
Package for Departing CEO
Countrywide Package
An analysis of securities filings
showed that CEO salaries rose
12% in 2004 compared with
average raises of 3.6% for rankand-file workers, further
widening the world's largest
gaps between executive and
labor pay.
CEO compensation swelled
from 85 times what workers
earned in 1990, to 209 times in
1996, and 326 times the
following year. In 1999, CEO
pay surged to a record 419
times the average worker's
wage, according to the U.S.
(Bureau of Labor Statistics)
WORLDWIDE PHENOMENON…
The ratio of the income in the world for
people in the top 1% has grown from 6
to 1 in 1980 to more than 200 to 1 now.
That ratio is not sustainable.
The Futurist, Jan-Feb 2006
GROWING US POVERTY
MEANWHILE, THE NUMBER OF
AMERICANS LIVING IN POVERTY
IS A GROUP SO LARGE THAT IT
WOULD TAKE THE COMBINED
POPULATIONS OF MISSISSIPPI,
LOUISIANA, ALABAMA, ARKANSAS,
AND TEXAS TO MATCH IT.
MILLIONS MORE WHO LIVE ABOVE
THE POVERTY LINE CANNOT AFFORD
HEALTH CARE, FOOD,
TRANSPORTATION, AND OTHER
BASIC EXPENSES. OFFICIAL
POVERTY LINES ARE THUS SET TOO
LOW: $9,800 FOR A SINGLE PERSON,
$20,000 FOR A FAMILY OF FOUR.
BY CONTRAST, THE ECONOMIC POLICY
INSTITUTE’S BASIC FAMILY BUDGET
CALCULATOR SAYS THE NATIONAL
MEDIAN BASIC NEEDS BUDGET
(INCLUDING TAXES AND TAX CREDITS)
FOR A TWO-PARENT, TWO-CHILD FAMILY
WAS $39,984 IN 2004 (OR $38,136 IN
NEW ORLEANS, OR $33,636 IN BILOXI,
MISSISSIPPI).
WORSE, MINORITY INCOMES
REMAINED MUCH LOWER, ABOUT
60% OF WHITE EARNINGS.
LET’S COMPARE
MEDIAN INCOME
BY RACIAL GROUP
Black Households
$30,134
Hispanic Households
$34,241
Non-Hispanic White
Households
$48,977
Asian Households
$57,518
SPEND FIVE MINUTES WRITING
TO THIS QUESTION:
WHAT DO YOU BETTER
UNDERSTAND ABOUT U.S.
INCOME DISTRIBUTION/
POVERTY/SOCIAL CLASS
AS A RESULT OF OUR CLASS
ACTIVITIES SO FAR?