The richest 1% of U.S. households had a net worth 225 times greater than that of the average American household in 2009, according to analysis conducted by the Economic Policy Institute, a liberal think tank. That's up from the previous record of 190 times greater, which was set in 2004.
The widening gap came even as wealthy households' average net worth tumbled 27% -- to about $14 million -- between 2007 to 2009. That's the first time that they suffered a decline since the three-year period of 1992 to 1995.
Meanwhile, the average family's net worth plunged 41% -- to just $62,200 -- from 2007 to 2009, according to EPI's calculations.
"The typical person lost more because a bigger percentage of their wealth in 2007 had been the value of their home," said Heidi Shierholz, an economist with EPI.
The rich took a significant wealth hit during the financial crisis absolutely, but the average American household lost 40% of its value in the same time period. And now in 2010 the wealthiest Americans have recovered nicely while the typical American family went nowhere. I'd bet any economist that the 225 time multiplier went up in 2010, the only question in my mind is by how much.
And in 2011 remember that home prices will continue to decline for many Americans, making this problem even worse.
We've got a long way to go just to get back to the inequality of 2004.
Posts
No comments:
Post a Comment