WEALTH DISPARITY: What If The One Percent Was You?
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WEALTH DISPARITY: What If The One Percent Was You?

In the post-recession, 21st-century America, many of us see ourselves on one side of an economic fence with the 1% on the other. We know that for nearly forty years the gap between the top and bottom wage earners has widened exponentially. Since 1979, real annual wages for the top 90-95th percent of earners have grown 35.7%, wages for the next 95-99th percent have risen 55.7%, and the top 1% have seen their wages increase 130.9%.1 Compare these figures to 15.2% growth for the remaining 90% during the same time and an extremely unpleasant taste might begin to surface in your mouth. What’s more, the growth of actual wealth — that is, the total accrual of monetary worth — has followed the same pattern.2

Change in Wealth for the one percent

Change in Share of Wealth (by group): 1983-2010
source: Economic Policy Institute

For most Americans in the lower 90% — myself included — this bad taste can transform level heads into vehement spitfires. We might imagine the 1% saying something like that line in Dazed and Confused: “I get richer, they stay the same.” Angry, frustrated, and feeling left behind, many Americans do not feel the economic “recovery” of the last five years has benefitted the middle and lower classes in any respect.3 In fact, this sentiment is grounded in some pretty firm figures: between 2009 and 2011 the mean net worth of households in the wealthiest 7% grew by 28% while the remaining 93% of households lost a net of 4% over the same time.4

We’ve written about this topic before and while no one wants to beat a dead horse, we do hope we can lead enough horses to water that some might actually drink. Ninty-three percent is a large portion of the population — by definition the vast majority of Americans see themselves in this disadvantaged ground, pitting our fortunes against the wealthy. A 55% majority of Americans feel the wealthy are more likely than the average person to be greedy, and 58% feel the wealthy don’t pay enough in federal taxes.5 A clear line has been drawn in the sand of public opinion, with the wealthiest 1% on one side and the remaining 99% of us on the other.

“We are the 99%!”

But are we?

Just who are these wealthy 1%? Who are the great “other” against whom we can cast our vehemence? Who are these Mark Zuckerbergs who seem so entrenched that they may be destined to forever glut themselves on the global market?

It turns out that membership to this patrician class is entirely mutable. According to a new survey of income records for Americans aged 25-60, 12% of the population will actually find themselves in the very same 1% for at least one year at some point in their lives. Another 39% of Americans will spend a year in the top fifth percentile, 56% will find themselves in the top tenth, and a whopping 73% will spend at least one year in the top twentieth percentile of the income distribution.

This means at some point in our lives, chances are a vast majority of Americans will experience the very same affluence that many in the middle-to-lower classes might be poised to revile.

So while we’re all holding our breath, beware —  that door swings both ways: 56% of Americans aged 25-60 will also experience poverty or near poverty at least once in their lives.

Moreover, if you’re lucky enough to be one of the top earners don’t get comfortable. The percentage of Americans who manage to maintain that level of wealth over the course of a decade drops to .6%. The majority of Americans who managed to eek into the top brackets only did so for a year before falling back. A lot of Americans will have the opportunity to gain wealth in their lives, but holding onto it is apparently extremely difficult.

So, we as Americans are likely to experience poverty but even more likely to experience prosperity, and possibly both. What does it all mean?

It means the volatility of the class structure in the United States is sound; it’s a part of what continues to make this country so enticing to immigrant workers from around the world. It should be fair to imagine that every day each one of us has the same opportunity to start a new life as well.

This is easy to forget; politicians and the media alike benefit from keeping Americans divided on this topic, pitted against each other, and not only our pockets but our voice and our strength become impoverished.

The line in the sand between the rich and the poor should be eroded. Americans need to learn to accept each other as equals; chances are the “other” on the far side of the line has walked or soon will be walking in your shoes. Life is a roller coaster, and we can’t curse the front of the ride for reaching the peak while the back remains in the trenches, for soon those places will be reversed.

Change is the inevitable state of all things, but in a partisan America where both ends of the ride are going in opposite directions the result is stagnation. In my opinion, that is the real danger facing us.

So the next time you see someone with a collar different from yours, be it blue or white, try to remember that they could represent your future. Let’s not step on them, let’s help each other.

Posted by Zimmerman. This is the second in a series of articles on wealth disparity.

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Notes:

1. Economic Policy Institute. (2012, August 22). Cumulative Change in real anual wage, by age groups, 1979-2010. The State of Working America. Retrieved from: http://www.stateofworkingamerica.org/chart/swa-introduction-figure-1l-cumulative-change-2/

2. Desilver, Drew. (2014, January 7). 5 Facts About Economic Inequality Pew Research. Retried from: http://www.pewresearch.org/fact-tank/2014/01/07/5-facts-about-economic-inequality/

3. Drake, Bruce. (2013, September 20). Majority of Americans say banks, large corporations benefited most from U.S. economic policies. Pew Research. Retrieved from: http://www.pewresearch.org/fact-tank/2013/09/20/majority-of-americans-say-banks-large-corporations-benefitted-most-from-u-s-economic-policies/

4. Fry, Richard. (2013, April 23). A Rise in Wealth for the Wealthy; Declines for the Lower 93%. Pew Research. Retrieved from: http://www.pewsocialtrends.org/2013/04/23/a-rise-in-wealth-for-the-wealthydeclines-for-the-lower-93/ 

5. Parker, Kim. (2012, August 27). Yes, the Rich are Different. Pew Research. Retrieved from http://www.pewsocialtrends.org/2012/08/27/yes-the-rich-are-different/

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