ERIC Number: ED453328
Record Type: Non-Journal
Publication Date: 2001-May-31
Reference Count: N/A
Pathbreaking CBO Study Shows Dramatic Increases in Income Disparities in 1980s and 1990s: An Analysis of the CBO Data. Revised.
Shapiro, Isaac; Greenstein, Robert; Primus, Wendell
A study by the Congressional Budget Office of income and tax trends since 1979 showed dramatic increases in income disparities, especially between the wealthiest one percent of Americans and the rest of society, in the 1980s and 1990s. The percentage of income Americans paid in federal taxes declined for every income group between 1979-97. The average after-tax income of the poorest 20 percent of American households in 1979 was $10,900 (adjusted for inflation and expressed in 1997 dollars); in 1997 it was $10,800. For the middle fifth of households, average after-tax income rose 10 percent over time. Average after-tax income climbed 157 percent among the top one percent of households. Income disparities between rich and poor, and between rich and middle class, were much wider in 1997 than at any other time studied. Data for 1998-99 indicate that all income groups gained somewhat since 1997, but those gains were concentrated at the top of the income distribution. The share of federal income taxes paid by those at the top increased over the past two decades, due to increased concentration of income among the very affluent. The top one percent of taxpayers experienced a larger percentage point drop in their effective tax rate during the study period than did any other group. (SM)
Center on Budget and Policy Priorities, 820 First Street, N.E., Suite 510, Washington, DC 20002. Tel: 202-408-1080; Fax: 202-408-1056; E-mail: firstname.lastname@example.org; Web site: http://www.cbpp.org.
Publication Type: Reports - Descriptive
Education Level: N/A
Authoring Institution: Center on Budget and Policy Priorities, Washington, DC.