The Economic Policy Institute and the Center on Budget Priorities ranks Massachusetts number 11 out of the 50 states in having the widest income gap between the top 5% and lowest 20% of families: $233,108 versus $19,690.
In other words, the wealthiest Mass. residents have almost 12 times the income of the lowest 1/5.
That’s ONE FIFTH – one out of every five families gets by on about 1/12 the amount of the richest among us, or should I say the richest among THEM.
Massachusetts may be one of the worst cases, but this income gap was seen in literally every state in the US. In Wyoming, the “best” case, the income of the lowest 20% of families is still only 1/8 of the income of the wealthiest.
Further, increases in the income gap have been getting larger since the early 1980’s; in other words, since the Reagan Presidency (1981-1989) and its infamous “trickle down” theory was made part of public policy.
Factors contributing to the ever-growing income gap could have been pulled directly from Chambers of Commerce reports in this state and this region: globalization, long periods of high unemployment, the growth in low-wage service jobs, and a “stagnant” minimum wage.
Add to this the fact that people who are just “getting by” don’t have the disposable income to plow into investment opportunities, and you pretty much get the full picture.
When I read numbers like these, I ask myself: who ARE these people and how do they rake in their $233,108 per?
Are they corporate raiders, investment bankers, defense attorneys, high-end salespeople? Married couples who both happen to be neurosurgeons? Real estate moguls? Retirees who made a killing in the stock market and are now buying caviar with their dividend income? The name “J. Sokolove” at the entrance to an exclusive section of Falmouth provides a clue.
Mashpee is a great example of a town with huge income disparities, from low income and public housing to trophy homes and waterfront estates which have, literally, gobbled up all but a few hundred yards of our already limited beaches. Even my young grandchildren have noticed and commented upon it.
I’m not sure what conclusions to draw from all this aside from the fact that the things I routinely bitch about in this blog are, in the view of those who’ve analyzed the data, an inevitable consequence of too few people having too damned much.
What I mean is that the researchers analyzed the social fallout from this income gap, and their conclusions could have been pulled directly from the anecdotal and statistical evidence social service agencies in this region have been concerned about for years: higher divorce and personal bankruptcy rates, an inclination to pay less for public services because the great majority of taxpayers are trying so hard to “keep up”, and out-migration from high cost of living areas.
In other words, this disparity in income warps our priorities as citizens and puts so much pressure on personal budgets that it literally destroys families.
Put that way, I guess there’s no great surprises in the income gap report after all.
POSTSCRIPT: The Cape Cod Times ran a superb article on this study which should put the kibosh on an earlier, ridiculously sanguine report from a Mass.-based agency that claimed the Cape’s economy is “healthier” than the state as a whole. The latter conclusion was based, among other fictions, on our supposedly higher level of employment, ignoring the fact that many of those jobs are minimum wage or low-paying service jobs.
The article in the CC Times stated one other horrendous statistic about Massachusetts: in this state, the growth rate of the income gap is HIGHER than 47 of the 50 states: “Only in New York and Arizona did the widening chasm between the rich and poor outpace Massachusetts”.