Radical Inequality

I've been writing about economic inequality for over a decade and, at this point, it's pretty hard to be shocked by new data. But David Cay Johnston has just crunched some numbers that will surprise even the most jaded observers of the widening gap between the Haves and everyone else. 

Drawing on research by economists Emmanuel Saez and Thomas Piketty, Johnston -- the former New York Times reporter acclaimed for his books on the rigged U.S. tax system -- shows just how much adjusted gross incomes have stagnated for the bottom 90 percent of people: "In 2011 the average AGI of the vast majority fell to $30,437 per taxpayer, its lowest level since 1966 when measured in 2011 dollars. The vast majority averaged a mere $59 more in 2011 than in 1966."

Stop and read that last sentence again: Most Americans made just $59 more in 2011 than they did 45 years earlier. 

Of course, though, America is a much, much wealthier place that it was in the mid-1960s, when large swaths of Appalachia didn't even have indoor plumbing. So where did all that new wealth go?

Well, while most people have been running in place, for the top 10 percent "average income rose by $116,071 to $254,864, an increase of 84 percent over 1966." And the top 1 percent of the top 1 percent, had an average income in 2011 of $23.7 million -- or $18.4 million more per taxpayer than in 1966.

Wow.

Johnston sums it up this way: "For each extra dollar of annual income going to each household in the vast majority, an extra $311,233 went to households in the top 1 percent of the top 1 percent."