Sanders Condemns Obscene Levels of Inequality Documented in New CBO Report
'Unacceptable' wealth inequality keeps growing in the U.S., with the top 10 percent of families owning three-quarters of total wealth
Yet another report, this one from the U.S. Congressional Budget Office (CBO), highlights what many American families already know: The rich keep getting richer, while everyone else keeps struggling to get by.
The CBO report, released Thursday and prepared at the request of Sen. Bernie Sanders (I-Vt.), examines trends in family wealth from 1989 to 2013.
It found, unsurprisingly, that the distribution of wealth—assets including home equity, other real estate holdings, financial securities, and defined contribution pension accounts—among the nation's families "was more unequal in 2013 than it had been in 1989."
Meanwhile, the report reads: "Compared with families in the top half of the distribution, families in the bottom half experienced disproportionately slower growth in wealth between 1989 and 2007, and they had a disproportionately larger decline in wealth after the recession of 2007 to 2009."
As of 2013, the top 10 percent of families owned a full 76 percent of total family wealth in the U.S., while those in the bottom half of the distribution held just one percent. The average wealth of the top 10 percent was $4 million, while families in the bottom 25 percent were $13,000 in debt on average.
"The reality, as this report makes clear, is that since the 1980s there has been an enormous transfer of wealth from the middle class and the poor to the wealthiest people in this country," he said. "There is something profoundly wrong when the rich keep getting richer and virtually everyone else gets poorer. That is unacceptable, and that has got to change."
He pointed out:
Higher education plays a key role in determining family wealth, according to the report. In 2013, households headed by someone with a college degree had four times more wealth than households headed by an individual with a high school degree.
But student loan debt was largely responsible for the increase in debt among the bottom 25 percent of families. Between 2007 and 2013 "the share of families with student debt increased from 25 percent to 36 percent, and the average amount increased from $24,000 to $36,000," CBO wrote. The percentage of indebted families with outstanding student debt rose from 56 percent in 2007 to 64 percent in 2013, and their average student loan balances increased from $29,000 to $41,000.
In turn, Sanders declared, "If we are going to reduce wealth inequality in this country, we must make public colleges and universities tuition-free and substantially lower student loan interest rates so that millions of young people do not leave school with a mountain of debt that burdens them for decades."
Just last week, an analysis from the Institute for Policy Studies (IPS) and the Corporation for Enterprise Development explained how reforming the U.S. tax code could help low-income Americans build wealth and savings while reducing wealth concentration at the top.
"Federal policymakers have a clear choice to make," said Chuck Collins of IPS at the time. "They can allow this pattern to continue and set our country on a road to economic devastation, or they can stop facilitating the wealth divide and start expanding opportunities to boost wealth for all families."