Most Americans have never cared too much about being fabulously rich – arguably, they still don’t. Contrary to many other societies, we’ve always tolerated ostentatious displays of wealth, and have long respected – even vigorously defended – an individual’s right to amass great amounts of money. The idea was that as long as we could live comfortably, with basic amenities and occasional luxuries, we couldn’t care less how much others were making. In other words, if the pie was big enough for the wealthy to take out a large slice, and still leave us a good amount to live well and prosperously with, everything was fine. It was a win-win system that let everyone have their cake and eat it too.
Unfortunately, that system appears to be unraveling. The middle-class is being squeezed, median incomes and wages are stagnating, and inequality is reaching record levels. The gap between rich and poor is increasing (especially between whites and minorities), and is entering a level common for poorer nations than long-developed ones. Again, such a wedge wouldn’t be so concerning if the bottom levels were only poor relative to a much higher standard: for example, if the poorest were pretty much middle-class while the richest were simply considerably rich. But by all indications, the fortunes of most Americans who don’t make up the top income bracket are tenuous at best, and show signs of fraying.
Take this chart for example, which highlights the disproportionate growth of wealth for high-income Americans, versus the near-plateau that defines that of the the rest. Even before the economic recession, there were many worrying signs that this country was on unsustainable economic path – and as is always the case, we took little serious notice of it until well after the fact. There is something very wrong in a society where half the population only own about 2.5% of all the nation’s wealth, or when 80% of people only have only 15% – 20% of total wealth, compared with those of the top 1% who own nearly a third. Current trends show that this wedge is only going to get wider with time.