Zweifel column: Growing income inequality is dividing the nation

Zweifel column: Growing income inequality is dividing the nation

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Amid all the machinations involving Donald Trump, especially during the past couple weeks, some even more depressing news went flying under the radar.

The gap between the haves and have-nots in the U.S. grew to its largest level in more than 50 years, the U.S. Census Bureau reported.

Yes, the rich got richer and the poor poorer during 2018, keeping up a trend that has plagued America the past five decades. This, despite Trump’s campaign promises that working people would get a bigger share of the pie if we elected him.

University of Florida economist Hector Sandoval said the income gap trend continued even though average household income increased. He said the increase wasn’t distributed evenly, possibly exacerbated by the 2017 tax cut engineered by Trump and the Republican-controlled Congress.

In other words, while take-home pay increased modestly for the average American, the incomes of the wealthiest grew at a much faster pace. As you may remember, those larger tax breaks for the rich were once again supposed to “trickle down” to the average folks. Funny how that never happens.

As a recent piece in The New Yorker pointed out, America’s income gap hasn’t always been so glaringly stark.

In fact, way back in 1831, France’s Alexis de Tocqueville’s glowing report on American democracy included his observation that the United States was the world’s most egalitarian society. Wages in the young nation were higher than in Europe, and while there were rich people, they weren’t super-rich like the aristocrats in Europe.

While the British economy was netting the richest 1% of the population more than 20% of the wealth in those early days, in America, the top 1% received less than 10%.

Today, the top 1% in America claim 20% of income, and as the new Census figures show, it’s getting bigger every year.

The income gap grew considerably in the so-called Gilded Age of the late 1800s, but it began to narrow after the Progressive era of the early 1900s and then during the economic boom after World War II, it narrowed to nearly where it was when de Tocqueville did his study a little more than 100 years before. In fact, the New Yorker article pointed out, by the 1970s, America was as equal as any of the Scandinavian countries are today.

But, then everything was upended. By the time the 1980s rolled around and Ronald Reagan became president, insisting that government was in the way of the economy, the wealth gap began growing again and continues to this very day. The ‘80s, of course, saw the advent of “trickle-down” economics and the deregulation craze fueled by the Chicago School of Economics and Milton Friedman, a favorite of Reagan and his entourage. “Free markets” would forever spur the economy and all would share in the spoils.

Progressives and others warned, as Franklin Roosevelt proclaimed in his day, that capitalism needs reins if it’s going to work for all the people.

Of course, the demise of America’s manufacturing base and low-cost products coming from foreign countries helped depress working people’s wages and contributed much to the inequality that has emerged. But, thanks to the fact that policies to boost wages and a tax system that requires the rich to pay their fair share of the bills were jettisoned, we now have what some insist is the world’s most unequal economy.

Some ask, “Should we worry about income inequality?” Only if you don’t care we are creating a nation divided — one rich, one poor.

Dave Zweifel is editor emeritus of The Capital Times. He can be reached by email at and on Twitter @DaveZweifel.

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