Pew Chartable Trust wants you to know that you are still broke

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Gerry Bello's picture
homeless man sleeping on a bench
America's wealth gap continues to grow despite the economic recovery. Photo by Robert Couse-Baker.

By Gerry Bello

The Pew Charitable Trust released a report on December 17 that put numbers to the feel of an absence of economic recovery and prosperity for 80 percent of Americans. Report summary: You are still as broke as you were five years ago, but your boss is doing much better. Thanks to well funded research of a wealthy think tank, you now can know how much money you don’t have.

The study measured the overall wealth of 5,000 American families. Wealth was defined as total assets minus total debt. The study then grouped American families according to yearly income. The value of a home (if you even own one), savings (if you have any) and possessions are totaled and then outstanding mortgages, credit card debt, unpaid medical bills, student loans and car loans are subtracted. The result is wealth. Unsurprisingly, people with greater incomes had greater wealth.

In 2001, the top fifth of income earners Americans held 4.4 times as much wealth as the next fifth, which Pew, defined as the “middle income,” despite their above average wage earnings. In 2007, just before the Great Recession, the top fifth of the population held 4.5 times the wealth of the second fifth. By 2013 it had jumped up to 6.6 times, a leap of 50 percent in the wealth gap between the top fifth of Americans and Americans with earnings in the sixtieth to eightieth percentile rage.

The data set used to construct the report was drawn from the Federal Reserve’s Survey of Consumer Finances and divided Americans evenly into five income brackets based on income and highlighted how middle income families were treading water, while upper middle income families were gaining ground from the recovery. The study defined upper-income as a family of two making more than $93,000 per year. It defined middle income as a family of 2 making $38,000 per year. Pew Trust said little to nothing about the bottom 60 percent of American families.

No major media outlet could be bothered to trumpet the fact that the wealth gap between upper income and middle income is double the income gap, or that the defined the bottom of the so-called middle class in America is two people making $9 an hour at full time work. The Pew Trust did not highlight the fact that 60 percent of Americans are not even doing as well as averaging $9 per hour in full time wages.

The report showed that the wealth gap widened along racial lines, with whites possessing 13 times the household wealth of African Americans, and 10 times the household wealth of Hispanics. Minority household wealth has continued to fall throughout the economic recovery. America's minorities have lost nearly half of their wealth since 2007.

Despite the rise of the “share economy,” where the tech industry has played a major role in the country's “economic recovery,” we are no longer a nation that shares prosperity in good time.

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