NYTimes.com: "Corporate Wealth Share Rises for Top-Income Americans"

[Filius Nullius]

According to a Congressional Budget Office analysis, the share of corporate wealth of the top one percent of U.S. households increased in 2003 by 4.1% from the year before. Over four percent in one year! How mind-blowing is that? They already own 57.5 percent. Where will we be in another ten years? At this rate, they will own 98.5 percent and the rest of us, well, 1.5 percent. And that is assuming that the rate of increase is arithmetic and not geometric.

The following excerpts come from an article entitled "Corporate Wealth Share Rises for Top-Income Americans" in the online version of the Sunday New York Times (nytimes.com):

"New government data indicate that the concentration of corporate wealth among the highest-income Americans grew significantly in 2003, as a trend that began in 1991 accelerated in the first year that President Bush and Congress cut taxes on capital.

"In 2003 the top 1 percent of households owned 57.5 percent of corporate wealth, up from 53.4 percent the year before, according to a Congressional Budget Office analysis of the latest income tax data. The top group's share of corporate wealth has grown by half since 1991, when it was 38.7 percent.

"In 2003, incomes in the top 1 percent of households ranged from $237,000 to several billion dollars.

"For every group below the top 1 percent, shares of corporate wealth have declined since 1991. These declines ranged from 12.7 percent for those on the 96th to 99th rungs on the income ladder to 57 percent for the poorest fifth of Americans, who made less than $16,300 and together owned 0.6 percent of corporate wealth in 2003, down from 1.4 percent in 1991.

"The analysis did not measure wealth directly. It looked at taxes on capital gains, dividends, interest and rents. Income from securities owned by retirement plans and endowments was excluded, as were gains from noncorporate assets such as personal residences."

....

"Long-term capital gains were taxed at 28 percent until 1997, and at 20 percent until 2003, when rates were cut to 15 percent. The top rate on dividends was cut to 15 percent from 35 percent that year.

"The White House said it did not believe that the 2003 tax cuts had much influence on wealth shares. It also said that since wealth is transitory for many people, a more important issue is how incomes and wealth are influenced by the quality of education.

"'We want to lift all incomes and wealth,' said Trent Duffy, a White House spokesman. 'We are starting to see that the income gap is largely an education gap.'

"'The president thinks we need to close the income gap, and he has talked about ways in which we can do that,' especially through education, Mr. Duffy said.

'The data showing increased concentration of corporate wealth were posted last month on the Congressional Budget Office Web site. Isaac Shapiro, associate director of the Center on Budget and Policy Priorities in Washington, spotted the information last week and wrote a report analyzing it.

"Mr. Shapiro said the figures added to the center's 'concerns over the increasingly regressive effects' of the reduced tax rates on capital. Continuing those rates will 'exacerbate the long-term trend toward growing income inequality,' he wrote.

"The center, which studies how government affects the poor and supports policies that it believes help alleviate poverty, opposes Mr. Bush's tax policies.

"The center plans to release its own report on Monday that questions the wisdom of continuing the reduced tax rates on dividends and capital gains, saying the Congressional Budget Office analysis indicates that the benefits flow directly to a relatively few Americans."

**********

The study shows that, for every group but the top one percent of households, the share of corporate wealth has declined.

Why is this happening? Well, it might be unclear from a cursory analysis because we have spent about the same amount of time under Republican and Democratic presidents since this period of accelerated concentration of wealth began in 1991. However, we have had a Democratically-controlled Congress for only the first three or four of those years. During the rest of this period, control of the two houses of Congress has been divided between the two parties or has been completely in the hands of the Republicans. The tax cuts that caused the tremendous acceleration of this trend in recent years was an initiative of President Bush and the Republican Congress, for which many of the pusillanimous Democrats in Congress also voted.

So why is it that the 99 percent seem completely helpless to prevent the one percent from taking over an ever larger share of this country's wealth?

Comments, anyone?

[acmavm]

1. What can one say here? That this is a surprise? Only amongst the

non-thinking segment of the population.

edit: to make myself understandable

[DBoon]

2. An education gap???

What sort of education is going to provide a $237,000 + income? This is the portion of the population that is benefiting from this transfer of wealth.