Given their role of « pioneer » in the growth of inequalities, we will discuss in detail the situation of the United States. And for this, begin by studying the Gini index of income of that country (which, for the record, the definition is here).
As we have seen, the U.S. index is significantly higher than in Europe: the country is more unequal, and its minimum is higher than the European maximum.
There is a peak in the index just before the crisis of 1929, marking the end of a period of very strong growth in inequality occurred in the period 1915-1930. The crisis, the New Deal of President Roosevelt and World War II would mark a sharp drop in inequality. But what is remarkable is that this trend continued after the war and throughout most of the thirty glorious years: the minimum of the index is reached in 1968. Since then, inequalities have been increasing, with a marked acceleration in the 1980s: the Reagan years were not lost on everyone – this is neo-conservatism: a return to the 20s!
Do at this point a brief digression on the European copy of this model : the United Kingdom.
It is found that the Thatcher years (gray) are « remarkable ». The index has jumped dramatically in the 1980s, when the country, unlike the U.S., had a much more egalitarian tradition, the post-war index was among the lowest historical world. It is observed that since 1990, the index has generally stabilized, but at a high level.
It is the victory of the neoconservative school of thought, for which inequalities should not be fought but instead sought: the model of growing inequality.
« We have to tolerate the inequality as a way to achieve greater prosperity and opportunity for all. » [Brian Griffiths, October 2009 - Advisor of Goldman Sachs and former adviser to Margaret Thatcher]
We will observe more closely the detailed distribution of high incomes. We are fortunate to have a remarkable work of researchers on this theme, directed by French Thomas Piketty and Emmanuel Saez. This section owes much to their statistics.
Figures for the United States are:
Thus in 2008:
- 10% of Americans (the « Top 10%, or 15,246,200 households) earned more than $ 109,100 (= P90);
- 0.01% of Americans (or 15 246 households) earned more than $ 9,141,200 (= P99, 99), and averaged $ 27.3 million;
- 90% earning the least (the « Bottom 90%) earned less than 109 k $ (P90) and on average $ 31 200
- (= P0-90);
- the lower half of 1% earners (P99-P99, 5) earned on average $ 443 100.
The following chart shows visually the shares of each sub-group of the top decile (P90-100) and their evolution over the past century. The second graph is a simple reminder of the distribution of income but not of the population: the top decile (those earning over $ 110K) is therefore 10% of the population, but winning nearly 50% of the mass income (accumulated 6 sub-groups). But inside, 9% have « only » 30% of revenue and the top 1% earns around 20%, with the top 0.01% earning almost 5%.
We see vividly the sudden drop in income share of top decile occurred in the late 30s, and stability until the early 1980s. The United States and found a pay structure identical to the 1920 …
But what is perhaps even more striking is the degree of concentration of recent developments:
If all fractions declined during the war, the phenomenon of unequal uptake of wealth, does almost as high percentile! The share of the 9 percentiles following is not impacted, or has a tendency to decline, any rise in revenues was captured by the top 1%. Thus, even those earning between 110 and 370 k $ have not benefited from Reaganism – they are too poor!
Renew this year while top percentile on the chart below.
Again, we see the profound inequality even within the top percentile. If the first half increased a little, following the 40% noted an increase that begins to be appreciable (their share increased by 50%) but is still the top decile of the top percentile (the top 0.1%) which greatly benefits the system, serving for 70% of the new wealth available, and multiplying by 4 its share in total income!
In conclusion, the new model of growing inequality begins to be interesting for very high incomes of over $ 500 000 per year, but it’s the « jackpot »for the 140,000 happy few earning more than $ 1.7 million per year.
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