Incomes Climbing For Wealthy - But Not For Others

As we end 2014, the Pew Research Center (using federal income data) shows us what is happening to incomes in the United States. The figures shown represent median household income of low, middle, and upper income groups -- and those groups are defined as:

low income -- makes less than 2/3 of national median income
middle income -- makes between 2/3 of median income and twice median income
upper income -- makes more than twice the median income

Note that the upper income folks have recovered nicely from the Bush recession, and their median income continues to grow as a ration with middle income households. Before the recession their income was 5 times greater than the median income for middle income households. That fell to 4.5 as the recession hit, but has now grown to 6.6 times greater. You can imagine how many times that median upper income is compared to the low income households.

The bottom chart shows what has happened to the incomes. While all three groups were hit by the Bush recession, the upper income households have rebounded, and are now showing significant increases in their median income. Not so for the middle income group. Their median income was lowered significantly during the recession, and is still not going up. In fact, it has remained stagnant for the last three years. Meanwhile, the low income group is still seeing their median income drop.

This shows why the gap between the rich and everyone else keeps widening, and these figures only show the "upper income" -- not the rich and super-rich, who are making much more. It also shows why most people (low and middle income people) don't believe the recession is over -- because they are still feeling its effects.

Unfortunately, with the Republicans taking control of both houses of Congress, this is not going to get any better. That's because they still cling to their failed "trickle-down" economic policy (the belief that giving more to the rich will help everyone. The economic playing field is already tilted to favor the rich, and the Republicans will now try to tilt it even more that way. It's going to be a tough couple of years for the lower and middle classes.