U.S. Prosperity Benefits Only the Ultra-Rich

New York Times editorial writer Teresa Tritch has written an important critique, presented in its entirety here, outlining why Bush economic policies benefit only the super rich. Here are some of her points:

Income inequality used to be about rich versus poor, but now it's increasingly a matter of the ultra rich and everyone else. The curious effect of the new divide is an economy that appears to be charging ahead, until you realize that the most of the people in it are being left in the dust. . .

The Center on Budget and Policy Priorities, a Washington think tank, . . . found a striking share of total income concentrated at the top of the income ladder as of 2004.

• The top 10 percent of households had 46 percent of the nation's income, their biggest share in all but two of the last 70 years.

• The top 1 percent of households had 19.5 percent.

• The top one-tenth of 1 percent of households actually received nearly half of the increased share going to the top 1 percent.

. . . the bottom 60 percent - average income grew by less than 20 percent from 1979 to 2004, with virtually all of those gains occurring from the mid- to late 1990's. Before and since, real incomes for that group have basically flatlined. . .

At issue, in economic terms, is the tradeoff between equality and efficiency: It can be difficult to divide the economic pie more equally without reducing the size of the pie. But it's not impossible, and doing so is crucial for widespread prosperity. . . [I]nequality is generally deemed to be dangerous - socially, economically, (and, perhaps, politically) - when it becomes so extreme as to be self-reinforcing, as many researchers suggest is currently the case.

. . . [And] tax cutting that overwhelmingly benefits the rich continues because, we're told, failure to keep cutting taxes would, somehow, shrink the pie. . .