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Forum Post: Richest 1 Percent Earn Biggest Share Since '20s

Posted 4 years ago on Sept. 11, 2013, 11:49 a.m. EST by LeoYo (5909)
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Richest 1 Percent Earn Biggest Share since '20s

Richest 1 percent of Americans are collecting biggest share of household income since the '20s

By Paul Wiseman, AP Economics Writer | Associated Press – 17 hours ago


WASHINGTON (AP) -- The gulf between the richest 1 percent and the rest of America is the widest it's been since the Roaring '20s. The very wealthiest Americans earned more than 19 percent of the country's household income last year — their biggest share since 1928, the year before the stock market crash. And the top 10 percent captured a record 48.2 percent of total earnings last year.

U.S. income inequality has been growing for almost three decades. And it grew again last year, according to an analysis of Internal Revenue Service figures dating to 1913 by economists at the University of California, Berkeley, the Paris School of Economics and Oxford University.

One of them, Berkeley's Emmanuel Saez, said the incomes of the richest Americans surged last year in part because they cashed in stock holdings to avoid higher capital gains taxes that took effect in January.

In 2012, the incomes of the top 1 percent rose nearly 20 percent compared with a 1 percent increase for the remaining 99 percent. The richest Americans were hit hard by the financial crisis. Their incomes fell more than 36 percent in the Great Recession of 2007-09 as stock prices plummeted. Incomes for the bottom 99 percent fell just 11.6 percent, according to the analysis.

But since the recession officially ended in June 2009, the top 1 percent have enjoyed the benefits of rising corporate profits and stock prices: 95 percent of the income gains reported since 2009 have gone to the top 1 percent.

That compares with a 45 percent share for the top 1 percent in the economic expansion of the 1990s and a 65 percent share from the expansion that followed the 2001 recession.

The top 1 percent of American households had pretax income above $394,000 last year. The top 10 percent had income exceeding $114,000.

The income figures include wages, pension payments, dividends and capital gains from the sale of stocks and other assets. They do not include so-called transfer payments from government programs such as unemployment benefits and Social Security.

The gap between rich and poor narrowed after World War II as unions negotiated better pay and benefits and as the government enacted a minimum wage and other policies to help the poor and middle class.

The top 1 percent's share of income bottomed out at 7.7 percent in 1973 and has risen steadily since the early 1980s, according to the analysis.

Economists point to several reasons for widening income inequality. In some industries, U.S. workers now compete with low-wage labor in China and other developing countries. Clerical and call-center jobs have been outsourced to countries such as India and the Philippines. Increasingly, technology is replacing workers in performing routine tasks. And union power has dwindled. The percentage of American workers represented by unions has dropped from 23.3 percent in 1983 to 12.5 percent last year, according to the Labor Department. The changes have reduced costs for many employers. That is one reason corporate profits hit a record this year as a share of U.S. economic output, even though economic growth is sluggish and unemployment remains at a high 7.2 percent.

America's top earners tend to be highly paid executives or entrepreneurs — the "working rich" — instead of elites who enjoy lives of leisure on inherited wealth, Saez wrote in a report that accompanied the new analysis.

Still, he added: "We need to decide as a society whether this increase in income inequality is efficient and acceptable."



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[-] 3 points by LeoYo (5909) 4 years ago

"Final" TPP Round Not Final: Are Even More Secretive Talks Ahead?

Wednesday, 11 September 2013 17:03 By Ben Beachy, Public Citizen | News Analysis


With no text agreed for several entire chapters and most tough political decisions unresolved, the so-called "final round" of Trans-Pacific Partnership (TPP) talks will not be the end of negotiations. After announcing for a domestic audience that the Trans-Pacific Partnership (TPP) negotiations were in their “end game,” U.S. Trade Representative (USTR) Michael Froman will face quite a different reality when he meets with TPP nations united in opposition to many core U.S. TPP proposals this week at the start of the 19th round of negotiations in Brunei. Without text for two TPP chapters and no deals on any of numerous difficult market access issues, from dairy and sugar to apparel and rice, it is clear that the Brunei Round will, in fact, not be the final negotiating session. The real question is whether the TPP negotiations coming after the Brunei Round will be unannounced and even more secretive, Public Citizen said today. Among the most contested aspects of the deal include the U.S. proposals on medicine patents, state-owned enterprises, Internet policy, financial regulatory limits, and environment and labor standards.

Only five of the TPP’s 29 chapters pertain to traditional trade matters. The rest would set policies, to which the U.S. Congress and state legislatures would be required to conform, relating to regulation of energy and other services, financial regulation, food safety, procurement policy, patents and copyright policy, and other non-trade issues. The draft pact also includes NAFTA-style foreign investor rules that facilitate job offshoring by removing many of the risks and costs of relocating U.S. production to low-wage countries. Among TPP negotiating countries is Vietnam, the lower-cost offshoring alternative to China.

One can see why negotiators being deadlocked over entire TPP chapters to the extent that there is not even text is a detriment to the Obama administration’s announced October deadline for signing the TPP on the sidelines of the Asian Pacific Economic Cooperation summit. However, reporters at the Brunei Round or participating in USTR briefings during the round are likely to get the “TPP End Game” spin. As Obama administration officials try to convince Congress that the TPP is almost completed, some questions that the Obama administration would undoubtedly rather avoid:

  1. Is the fact that there is no intellectual property chapter text to even negotiate over – even a heavily bracketed text – related to unwavering multi-year opposition to U.S. patent and copyright text proposals?

  2. Is the multi-year deadlock over the TPP’s state-owned enterprises chapter going to be resolved in Brunei by the four nations in absolute opposition to the U.S. suddenly changing its position, or by the U.S. giving up on state-owned enterprise disciplines?

  3. And what about the labor rights chapter, which is “done”… except for staunch opposition by many TPP countries to it being enforceable. Given that the Obama administration has pledged to Congress that the pact will have labor rights enforceable on par with the pact’s commercial provisions, what will happen to the non-undecided enforcement section of the TPP chapter?

  4. And what about the environment chapter? There is a deadlock over not only the chapter’s enforceability but also the key rules such as enforcement of countries’ obligations in environmental treaties.

  5. Has the U.S. now conceded to Vietnam the right to have duty-free treatment for apparel products assembled from Chinese textiles and other inputs so that Vietnam is now participating in closing up negotiations on other chapters, which it has not done to date?

  6. Given united opposition by the other TPP countries that has thwarted closure to date of several TPP chapters, has the U.S. relented in its insistence that the TPP forbid any signatory country from using capital controls, speculation, or transaction taxes and other common macroprudential financial measures?

  7. Have other countries dropped unified opposition to the U.S. proposal in the investment chapter to extend the controversial investor-state system to procurement and private-public-partnership utility management and natural resource contracts through an “umbrella clause”?

  8. Will the United States allow Japan to exclude the five “sacred” commodities – rice, wheat and barley, beef and pork, sugar and dairy – from the TPP tariff zeroing, which is the condition for participating in the TPP that was set by the majority LDP party? “The fact that entire chapters of the TPP remain without even a draft text to fight over won’t be a popular talking point in Brunei, given that the Obama administration is claiming that the agreement is almost done while in reality negotiations will just continue on in even greater secrecy,” said Lori Wallach, director of Public Citizen’s Global Trade Watch. “Apparently, the response to the growing opposition to the TPP among the U.S. Congress and the public here, and legislators and the public in other countries, is to drag negotiations even further underground and claim a deal is almost done.”

This piece was reprinted by Truthout with permission or license.

[-] 1 points by MattLHolck (16833) from San Diego, CA 4 years ago

I don't think any people are going to support the TPP laws for much longer

sorry Putin

[-] 0 points by TropicalDepression (-45) 4 years ago

This is why I hate representative democracy and top down. None of these people were elected to do this shit.

Kavatz makes some good points with his departments posts.

[-] 2 points by Nevada1 (5843) 4 years ago

The underachievers that inherit the world, are greedy.