One Graph That Shows Rising Inequality Over Last 35 Years

In my previous post, I talked about the new study from the Economic Policy Institute (EPI) that documents that African Americans continue to be paid significantly less than their white counterparts. But I also wanted to point to another graph in that report which sums up the incredible growth in economic inequality over the last 35 years.

Productivity has increased over 60% over the last 35 years. In the past, rising productivity translated into rising wages for workers. And that seems to be the case for women, but a lot of that is driven simply by the increase in the number of women in the work force and their career advancement. And we all know that women are also still paid less than their male counterparts and continue to face the "glass ceiling". For men, however, the median hourly wage has actually decreased even as productivity has grown. So where did all the gains from increased productivity go? According to the EPI, "Since 1979, wages have grown more slowly than productivity—a measure of the potential for wage growth—for everyone except the top 5 percent of workers, while wage growth for the top 1 percent has significantly exceeded the rate of productivity growth". Decreasing tax rates for the wealthy and the focus on corporate profitability at the expense of workers and communities have resulted in rising inequality. The obvious solution lies in higher taxes on the wealthy and greater income redistribution.