Obamanomics: The president has been decrying the growing gap between rich and poor in the U.S. to help sell his retread tax-and-spend proposals. But those policies have already produced record levels of income inequality.
In his speech in Illinois last week, and at events since, Obama described income inequality in the starkest terms. “This growing inequality is morally wrong,” he said, and “undermines the very essence of America.”
To be sure, income inequality is a standard trope for liberals, who always use it to advocate more wealth redistribution.
And Obama’s latest focus neatly coincides with his plans to push for more federal spending and taxes on the “rich” in coming budget battles.
But what Obama conveniently leaves out of his sermons is that income inequality has grown faster on his watch than any time in the past two decades, at least.
Research by University of California economist Emmanuel Saez shows that since the Obama recovery started in June 2009, the average income of the top 1% grew 11.2% in real terms through 2011.
The bottom 99%, in contrast, saw their incomes shrink by 0.4%.
As a result, 121% of the gains in real income during Obama’s recovery have gone to the top 1%. By comparison, the top 1% captured 65% of income gains during the Bush expansion of 2002-07, and 45% of the gains under Clinton’s expansion in the 1990s.
The Census Bureau’s official measure of income inequality — called the Gini index — shows similar results. During the Bush years, the index was flat overall — finishing in 2008 exactly where it started in 2001.
It’s gone up each year since Obama has been president and now stands at all-time highs.
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