The NewStandard ceased publishing on April 27, 2007.

Americaâ€TMs Income Gap Continues to Grow*

by Brendan Coyne

*A correction was appended to this news brief after initial publication.

Oct. 18, 2005 – Already at a near-record level, the income gap in the United States continues to grow, according to an analysis of Internal Revenue Service data by the Center on Budget and Policy Priorities. The study, using IRS records from 2002 and 2003, shows that the average income for the top 1 percent of earners in the nation rose by $49,000 while the bottom 75 percent of US residents saw their incomes drop.

The average after-tax takings of the top percent of the population jumped from $298,900 to $631,700 between 1979 and 2003, the CBPP found. During the same period, after-tax income for the majority of the country fell slightly.

The findings show that "income is extraordinarily concentrated today," the report said. The authors maintain that tax cuts enacted under President Bush are accelerating a long-standing problem with the US economy.

In August, the US Census Bureau released official statistics showing a slight rise in the poverty rate from 2003 to 2004 and a decade-long trend of growing income inequality highlighted by rising revenues for the top 20 percent of households and a drop in earnings for the bottom 60 percent. Income levels for blacks fell overall, the census also noted.

The CBPP study of IRS data comes as Congress considers cutting spending on domestic social programs that help the poor. This week, the US House of Representatives is debating legislation that could cut spending on social programs by $50 billion or more.

CORRECTION

Minor Change:

The sentence that now begins:

The average after-tax takings of the top percent of the population jumped from $298,900 to $631,700 between 1979 and 2003...

Originally read:

The average after-tax takings of the top percent of the population jumped from $298,900 to $631,700 between 2002 and 2003...

 | Change Posted October 19, 2005 at 23:36 PM EST

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The NewStandard ceased publishing on April 27, 2007.


Brendan Coyne is a contributing journalist.

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