Today, I came across some interesting facts about the “rich” in this country that either challenge those offered by the Occupy Wall Street movement, or force its followers reconsider how they “redistribute” wealth in this country.
Let’s Do the Time Warp Again
According to The New York Times, the share of income earned by the top one percent dropped from 23 percent in 2007 to 17 percent in 2009. In other words, the Great Recession has served as a bit of an income equalizer. In fact, the numbers are now back to where they were during the Clinton administration. It seems the financial crisis has already to a large extent “corrected” income inequality.
Rethinking Social Security
If Occupiers are interested in redistributing income, a recent Pew Center report may indicate that reducing Social Security benefits may do more for income equality than increasing taxes carte blanche on the “wealthy.”
Because there is a rising age gap in economic well-being. In 1984, the net worth of households headed by adults 65 and older was 10 times that of those headed by an adult under 35. It should be no surprise that there is at least some wealth gap, given that those over 65 have had at least three more decades to earn and save their salaries. However, in 2009, this ratio had nearly quintupled to 47 to 1. That is, the typical household headed by an older adult had $170,494 in net worth versus his younger counterpart with $3,662.
Rather than increasing taxes on the “wealthy”, shouldn’t the government simply apply a means-test to senior citizens each year so that only those who actually need Social Security receive it?
It seems pretty reasonable to me.