Income Inequality Gets Worse

According to research at MarketWatch.com, the lopsided income distribution portrayed in the series Downton Abbey is the reality of the US economy, our income inequality is about like that of the period 90 years ago in England.  This is the fodder of civil unrest if it gets worse, as is likely.

The richest take home a higher share of national income in America today than did the aristocrats and superrich of 1920s England. The poor today take home a smaller share than the butlers, chauffeurs and other working folk did back then.

Peter Lindert, economics professor at the University of California in Davis, and one of the world’s leading experts in measuring income inequality, will be presenting research at the NBER this week, and he shared his thoughts with me by email. “Britain’s Downton Abbey economy of the 1920s,” Lindert says, was slightly “ less unequal than…the U.S. today” (emphasis added).

For example, he points to the so-called GINI Coefficient, the standard measure of economic inequality used by researchers and organizations around the world, from the Census Bureau to the World Bank. U.S. readings today are about as high as those of 1920s England, says Lindert. They may even be higher. Incidentally, other research has found that U.S. readings of the GINI coefficient are higher than those of Czarist Russia as well.