In recent years, there have been a slew of studies cataloging evidence of expanding income inequalities. Here’s another. According to a recent analysis by the Federal Reserve Bank, average incomes rose by 10 percent from 2010 to 2013 for the most affluent 10 percent of American families. For the balance of the population, average incomes were flat or declined.
The least affluent families sustained the largest declines. Average incomes fell by 8 percent for the bottom 20 percent of families the Federal Reserve reported in its triennial Survey of Consumer Finances, one of the most comprehensive sources of data regarding the financial health of American families. As reported in the New York Times, overall American wealth barely changed during the survey period, but money sloshed from the bottom to the top.
This is not evidence of trickle down economics, it is evidence of a trickle up. For the top 10 percent of families ranked by income, estimated average wealth rose by 2 percent to $3.3 million. For the bottom 20 percent of families, average wealth declined by 21 percent. These trends are clearly impacting economic growth since money is increasingly flowing to people who already have so much that they are less likely to spend each incremental dollar.
