US income gap widens as poor take hit in recession

[one...two...tree 2,762]

By Hope Yen, Associated Press Writer

WASHINGTON (AP) -- The recession has hit middle-income and poor families hardest, widening the economic gap between the richest and poorest Americans as rippling job layoffs ravaged household budgets.

The wealthiest 10 percent of Americans -- those making more than $138,000 each year -- earned 11.4 times the roughly $12,000 made by those living near or below the poverty line in 2008, according to newly released census figures. That ratio was an increase from 11.2 in 2007 and the previous high of 11.22 in 2003.

Household income declined across all groups, but at sharper percentage levels for middle-income and poor Americans. Median income fell last year from $52,163 to $50,303, wiping out a decade's worth of gains to hit the lowest level since 1997.

Poverty jumped sharply to 13.2 percent, an 11-year high.

"No one should be surprised at the increased disparity," said Richard Freeman, an economist at Harvard University. "Unemployment hurts normal workers who do not have the golden parachutes the folks at the top have."

Analysts attributed the widening gap to the wave of layoffs in the economic downturn that have devastated household budgets. They said while the richest Americans may be seeing reductions in executive pay, those at the bottom of the income ladder are often unemployed and struggling to get by.

Large cities such as Atlanta, Washington, New York, San Francisco, Miami and Chicago had the most inequality, due largely to years of middle-class flight to the suburbs. Declining industrial cities with pockets of well-off neighborhoods, such as Pittsburgh, Cleveland and Buffalo, N.Y., also had sharp disparities.

Up-and-coming cities with growing middle-class populations, such as Mesa, Ariz., Riverside, Calif., Arlington, Texas, and Henderson, Nev., were among the areas showing the least income differences between rich and poor.

It's unclear whether income inequality will continue to worsen in major cities, said William H. Frey, a demographer at the Brookings Institution. Many Americans are staying put for now in traditional cities to look for jobs and because of frozen lines of credit.

"During the years of the housing bubble, there was middle-class movement from unaffordable metros with high-income inequality," Frey said. "Now that the bubble burst, more of the population may be headed back to the high-inequality areas, stemming their middle-class losses."

As to poverty, the biggest shifts last year were increases in metropolitan areas in Florida and central California. Stockton, Calif., jumped from 14.1 percent to 16.8 percent, while Lakeland-Winter Haven, Fla., rose from 12.7 percent to 15.4 percent. Tampa-St. Petersburg, Orlando, Bradenton and Palm Bay -- all in Florida -- also saw gains in the share of poor residents.

Among other findings:

--Income at the top 5 percent of households -- those making $180,000 or more -- was 3.58 times the median income, the highest since 2006.

--Twenty-one states and the District of Columbia had higher poverty rates than the national average, many of them in the South, such as Mississippi (21.2 percent), Kentucky, Arkansas and Louisiana (each with 17.3 percent). That's compared with 19 states and the District of Columbia that ranked above U.S. poverty in 2007.

--Use of food stamps jumped 13 percent last year to nearly 9.8 million U.S. households, led by Louisiana, Maine and Kentucky. The increase was most evident in households with two or more workers, highlighting the impact of the recession on both working families and unemployed single people.

--Pharr, Texas, and Flint, Mich., each had more than a third of its residents on food stamps, at 38.5 percent and 35.4 percent, respectively.

--Between 2007 and 2008, income at the 50th percentile (median) and the 10th percentile fell by 3.6 percent and 3.7 percent, respectively, compared with a 2.1 percent decline at the 90th percentile. Between 1999 and 2008, income at the 50th and 10th percentiles decreased 4.3 percent and 9 percent, respectively, while income at the 90th percentile was statistically unchanged.

--Plano, Texas, a Dallas suburb, had the highest median income among larger cities, earning $85,003. Cleveland ranked at the bottom, at $26,731.

The findings come as the federal government considers new regulations to rein in executive pay at companies in which it has invested. President Barack Obama also typically cites the need for higher taxes on the wealthy to pay for health care overhaul and other measures, arguing that the wealthy have disproportionately benefited from tax cuts during the Bush administration.

The 2008 figures come from the Current Population Survey and the American Community Survey, which gathers information from 3 million households. The government first began tracking household income in 1967.

Associated Press writer Frank Bass contributed to this report.

Census Bureau: http://www.census.gov

http://finance.yahoo.com/news/US-income-ga...403228.html?x=0

[NickD 203]

All you have to do is to get on the other side of the fence. Anybody know where that fence is at, so we can climb over it?

One way I heard about it, is to get elected to office and have a short memory how things were before you got there.

[HYENA 4]

true...be greedy as hell and get into some presidential office of any company then bleed it dry so the Asian countries can bid and win and employ and run the thing from overseas.

The politicians are all so corrupt, maybe a lobbying firm and you'll have more power than the asinine presidents who keep scrolling through

[one...two...tree 2,762]

The politicians are all so corrupt, maybe a lobbying firm and you'll have more power than the asinine presidents who keep scrolling through

That's pretty cynical and teeters on anti-Americanism. Our system may not be perfect, but it works. Power corrupts...but that's true in all avenues and forms of it. The Republicans have fought against any real campaign finance reform on the grounds of the 1st Amendment. We just a more balanced Supreme Court that calls bullsh!t to the notion that giving money to a politician is protected speech.

[Nikita2Charles 33]

Part of it has to do with the Selling of America

Outsourcing, low cost manufacturing, OFFSHORING. whatever twist name the corporations decide to mask the reality from the public. Making matter worse you have to train your replacements from overseas.

One division was moving its operation overseas to Asia, looking at the number I was asking where's the saving, since some of our local vendors(USA) were willing to offer a better price to keep our business. But from the head up the chain you have to get a vendor from Asia since this is where the company was heading.

2) The reality, there wasn't much saving when it comes to building the product, most of the saving came in the form of a 10 YEAR TAX BREAK.

At one time that group had about 185 engineers, technicians working in mfg, now all of those jobs were transfered to Asia for that division so let's take a look a the numbers

185 people who use to pay - Federal, State, Local, Taxes, support the local restaurant, businesses

Now those people went on EDD(Unemployment) instead of contributing, they are taking assistance from the govt.

To make matter really worse, some of these guys had to Asia to help setting up the operation there, I refused to go based on my principle you bring them here i'll train them but as far as going the extra mile of going there for months end, forget about it.

Those guys that went were promised they would be transfered internally when they come back, I asked a few of them to get that agreement in writting, because I know it was all BS, talking about MEAN

They asked them to fly back to the US one week before a Major Layoff, when they report to work on Monday, they were informed of their Layofff, talking deception and Jacka$$$

WE need your help to make this plan successfull, technically we need your help to get rid of your jobs, and to think our tax $$$ is helping companies doing outsourcing was CRAZY.

We should give tax break to companies creating JOBS RIGHT HERE IN THE US. not tax break for sending your jobs overseas, you would think it's just common sense, there's none of it in Washington it's all about the MONEY, the Lobbyist, JUST FOLLOW THE MONEY TRAIL.

[one...two...tree 2,762]

Part of it has to do with the Selling of America

Outsourcing, low cost manufacturing, OFFSHORING. whatever twist name the corporations decide to mask the reality from the public. Making matter worse you have to train your replacements from overseas.

Labor has taken a real hit over the last couple of decades. The unions are not as strong as they once were and there seemed to a be a growing negative view of labor unions starting with the Air Traffic Controllers' Strike.

We need to answer the question of how we can have a sustainable future economy while continuing with such a huge trade imbalance with China. What is going to the driving force behind a new economy? We can't continue on a path of a consumer driven economy...it's simply not sustainable and we'll see a continuing gap between the rich and the poor.

We're slowly going to turn ourselves into a Third World country.

Edited October 1, 2009 by Col. 'Bat' Guano

[AlHayatZween 2]

We're slowly going to turn ourselves into a Third World country.

Unfortunately, i don't think we are moving that slowly in the downward spiral.

[mawilson 2,133]

The politicians are all so corrupt, maybe a lobbying firm and you'll have more power than the asinine presidents who keep scrolling through

That's pretty cynical and teeters on anti-Americanism. Our system may not be perfect, but it works. Power corrupts...but that's true in all avenues and forms of it. The Republicans have fought against any real campaign finance reform on the grounds of the 1st Amendment. We just a more balanced Supreme Court that calls bullsh!t to the notion that giving money to a politician is protected speech.

Yep. Just don't make it a Republican vs Democrat issue - they are part of the same corrupt regime.

Both parties embrace socialism or capitalism or whatever -ism that suits their agenda.

If you want real change, do not vote for Republicans or Democrats ever again.

[NickD 203]

This sentence twisted my brain.

"We just a more balanced Supreme Court that calls bullsh!t to the notion that giving money to a politician is protected speech."

Are you inferring that our supreme court is also corrupt? Like judges being appointed by a biased president with a salve congress? Exactly where is the balance of power between the executive, legislative, and judicial branches?

Really do believe this is not a democratic or republican issue and those that do believe, should have their heads examined or at least, take them out of the sand, or butts if you prefer.

[one...two...tree 2,762]

This sentence twisted my brain.

"We just a more balanced Supreme Court that calls bullsh!t to the notion that giving money to a politician is protected speech."

Are you inferring that our supreme court is also corrupt? Like judges being appointed by a biased president with a salve congress? Exactly where is the balance of power between the executive, legislative, and judicial branches?

Really do believe this is not a democratic or republican issue and those that do believe, should have their heads examined or at least, take them out of the sand, or butts if you prefer.

Good grief, Nick. It wasn't me condemning all our politicians as corrupt. What I mean by balance, is that the court be more ideologically balanced. IMO, it's judicial activism to interpret the 1st Amendment as applicable to campaign donations.

Edited October 1, 2009 by Col. 'Bat' Guano

[NickD 203]

This sentence twisted my brain.

"We just a more balanced Supreme Court that calls bullsh!t to the notion that giving money to a politician is protected speech."

Are you inferring that our supreme court is also corrupt? Like judges being appointed by a biased president with a salve congress? Exactly where is the balance of power between the executive, legislative, and judicial branches?

Really do believe this is not a democratic or republican issue and those that do believe, should have their heads examined or at least, take them out of the sand, or butts if you prefer.

Good grief, Nick. It wasn't me condemning all our politicians as corrupt. What I mean by balance, is that the court be more ideologically balanced. IMO, it's judicial activism to interpret the 1st Amendment as applicable to campaign donations.

And that is exactly what it is, can use interpretation or an opinion on what the founders of the US Constitution meant. And the vote doesn't even have to be unanimous in the case of twelve jurists, a 5 to 4 vote is all that is required. That is poor, very very poor when we have laws made where nine justices can't even agree.

[mawilson 2,133]

This sentence twisted my brain.

"We just a more balanced Supreme Court that calls bullsh!t to the notion that giving money to a politician is protected speech."

Are you inferring that our supreme court is also corrupt? Like judges being appointed by a biased president with a salve congress? Exactly where is the balance of power between the executive, legislative, and judicial branches?

Really do believe this is not a democratic or republican issue and those that do believe, should have their heads examined or at least, take them out of the sand, or butts if you prefer.

Good grief, Nick. It wasn't me condemning all our politicians as corrupt. What I mean by balance, is that the court be more ideologically balanced. IMO, it's judicial activism to interpret the 1st Amendment as applicable to campaign donations.

I don't know if it's "activism", but it sure is a bizarre interpretation, especially as it relates to

*corporations'* 1st Amendment rights.

[mawilson 2,133]

We need to answer the question of how we can have a sustainable future economy while continuing with such a huge trade imbalance with China.

"Devalue our currency" seems to be the plan.

[alienlovechild 75]

That's pretty cynical and teeters on anti-Americanism. Our system may not be perfect, but it works. Power corrupts...but that's true in all avenues and forms of it. The Republicans have fought against any real campaign finance reform on the grounds of the 1st Amendment. We just a more balanced Supreme Court that calls bullsh!t to the notion that giving money to a politician is protected speech.

How so we forget. McCain and Finegold ring a bell? Obama opted out of Federal matching funds to get more and avoid Federal restrictions on amounts that could be raised. BTW, the Supreme Court usually considers that political speech deserves the highest consitutional protection by once Obama picks a couple more justices, that may not be the case in the future.

Edited October 2, 2009 by alienlovechild