Last year eight Americans—the four Waltons of Walmart fame, the two Koch brothers, Bill Gates and Warren Buffett—made more money than 3.6 million American minimum-wage workers combined. The median pay for CEOs at America’s large corporations rose to $10 million per year, while a typical chief executive now makes about 257 times the average worker’s salary, up sharply from 181 times in 2009. Overall, 1 percent of Americans own more than a third of the country’s wealth.
As the United States slips from its status as the globe’s number one economic power, small numbers of Americans continue to amass staggering amounts of wealth, while simultaneously inequality trends toward historic levels. At what appears to be a critical juncture in our history and the history of inequality in this country, here are nine questions we need to ask about who we are and what will become of us. Let’s start with a French economist who has emerged as an important voice on what’s happening in America today.
1) What does Thomas Piketty have to do with the 99 percent?
French economist Thomas Piketty’s surprise bestseller, Capital in the Twenty-First Century, is an unlikely beach read, though it’s selling like one. A careful parsing of massive amounts of data distilled into “only” 700 pages, it outlines the economic basis for the 1 percent-99 percent divide in the United States. (Conservative critics, of course, disagree.)
Just in case you aren’t yet rock-bottom certain about the reality of that divide, here are some stats: the top 1 percent of Americans hold 35 percent of the nation’s net worth; the bottom 80 percent, only 11 percent percent. The United States has such an unequal distribution of wealth that, in global rankings, it falls among the planet’s kleptocracies, not the developed nations that were once its peers. The mathematical measure of wealth-inequality is called “Gini,” and the higher it is, the more extreme a nation’s wealth-inequality. The Gini for the US is 85; for Germany, 77; Canada, 72; and Bangladesh, 64. Nations more unequal than the US include Kazakhstan at 86 and the Ukraine at 90. The African continent tips in at just under 85. Odd company for the self-proclaimed “indispensable nation.”