Wealth
Now let’s turn from income to wealth. While income captures the money coming into a family or household an annual basis, wealth measures accumulated assets or “net worth.” This includes savings, home equity, and investments (and subtracts debts). Here the American pattern of inequality is starker still [see FIG below], although also less widely understood or appreciated. The top 1 percent claim about a third of the nation’s wealth. The top 5 percent claim over 60 percent. The top 10 percent claim over 70 percent. The top 20 percent claim over 80 percent. The next two percentiles—those falling between the richest 20 percent and poorest 40 percent—together claim a little more than 10 percent. Leaving the poorest 40 percent with a share of national wealth that is nearly imperceptible on the chart below.
This inequality has been attenuated in recent years, since housing is (or was) the main source of wealth for middle-income American families. Between 2007 and 2010 alone [see FIG below], those in the broad middle class (between the 20th and 60th income percentiles) saw their family wealth slip almost 40 percent.19
This distribution of wealth is starkly at odds with that of our international peers [see FIG below]. The share claimed by the top 1 percent in the US comes closer to the share claimed by the top 5 percent in most other settings. The share claimed by the top 5 percent in the US, exceeds that claimed by the top 10 percent in all other settings. And the share claimed by the top 10 percent in the US is—for most of our peers-- as close to the median as it is to the 10 percent.20
This inequality has been attenuated in recent years, since housing is (or was) the main source of wealth for middle-income American families. Between 2007 and 2010 alone [see FIG below], those in the broad middle class (between the 20th and 60th income percentiles) saw their family wealth slip almost 40 percent.19
This distribution of wealth is starkly at odds with that of our international peers [see FIG below]. The share claimed by the top 1 percent in the US comes closer to the share claimed by the top 5 percent in most other settings. The share claimed by the top 5 percent in the US, exceeds that claimed by the top 10 percent in all other settings. And the share claimed by the top 10 percent in the US is—for most of our peers-- as close to the median as it is to the 10 percent.20
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