Washington – The White House proposal to curb tax deductions that benefit firms and high-income individuals as part of the deficit-reduction negotiations that are continuing on Tuesday have put the magnifying glass on the richest 10 percent of the U.S. population, whose share of the national wealth is growing.
"Any agreement to reduce our deficit is going to require tough decisions and balanced solutions," President Barack Obama said at a press conference last week. "I think it's only fair to ask an oil company or a corporate jet owner that has done so well to give up a tax break that no other business enjoys."
The numbers show that things are going ever better for U.S. millionaires and billionaires.
A June 18 article in The Washington Post mentioned that the richest 10 percent of the population had in 2008 - the last year for which data are available - almost the same share of the total national income as the remaining 90 percent.
The statistics compiled by the Post show that the income of the richest 0.1 percent, about 152,000 people, increased by 385 percent between 1970 and 2008, to $5.6 million per capita per year on average.
On the other hand, the bottom 90 percent have seen their purchasing power fall by 1 percent over the same period, with a median annual household income of $31,244.
Income inequality also has increased in countries like China, India and Britain, but the trend has been more pronounced in the United States, which now ranks alongside developing countries such as Cameroon and Ivory Coast.
Sarah Bloom Raskin, one of the seven Federal Reserve governors, last week warned that the inequality stems from the stagnation in income for the majority of Americans and the rapid increase in the wealth of the top 1 percent.
"This inequality is destabilizing and undermines the ability of the economy to grow sustainably and efficiently," she said at a forum in Washington sponsored by the New America Foundation.
To her remarks can be added the voices of figures such as former Turkish economy minister and U.N. official Kemal Dervis, now vice president of Global Economy and Development at Washington's Brookings Institution, who has also spoken out about the dangers of this growing inequality.
When a large part of income is concentrated in a small group consumer spending must be stimulated either through super-low interest rates or making it possible for households to take on more and more debt, as was the case during the greater part of the last decade in the United States, Dervis maintains.
Arthur Okun (1928-1980), chairman of the White House Council of Economic Advisers in 1968-1969, put the matter bluntly in a book published in 1974.
"American society proclaims the worth of every human being," he said in "Equality and Efficiency, The Big Tradeoff," yet U.S. institutions "award prizes that allow the big winners to feed their pets better than the losers can feed their children."
The solution to the problem appears difficult. Congressional Republicans, for the moment, are refusing to increase taxes as part of the agreement to reduce the deficit.