The data in question can be seen here. I understand that the Economic Policy Institute (EPI) is considered a left-leaning think tank, but regardless of its slant, I’ve yet to see this data disputed. From what I’ve read, the raw data pretty much confirms what most people are observing anecdotally: that our once widely-perceived meritocratic and classless society is becoming socioeconomically stratified like never before. Even the tax-heavy social democracies we regard as anti-business and “socialist” offer greater opportunities for upward mobility (as I discussed in a previous post).
A HuffPo piece that cites the article adds further detail (emphasis mine):
Income inequality between CEOs and workers has consequently exploded, with CEOs last year earning 209.4 times more than workers, compared to just 26.5 times more in 1978 — meaning CEOs are taking home a larger percentage of company gains.
That trend comes despite workers nearly doubling their productivity during the same time period, when compensation barely rose. Worker productivity spiked 93 percent between 1978 and 2011 on a per-hour basis, and 85 percent on a per-person basis, according to the Federal Reserve Bank of St. Louis.
Meanwhile, workers saw their inflation-adjusted wages fall in recent years as corporations postponed giving raises while adding to their record corporate profits.
Certainly, there are many reasons why our economy is faltering, but it seems that a major factor is the increasingly greedy and predatory nature of America’s business culture. Profits for most companies are at record highs, yet so too is unemployment.America has one of the lowest minimum wages in the developed world, while also having the highest proportion of its workforce employed in low-wage jobs, yet still many businesses – often the most profitable ones – continue to cut benefits, freeze wages, and work their employees harder. Companies are no longer investing in their workers.
These same self-entitled business elites crow for small government and the free-market; but in essence, they’re undermining their own ideology. If they want low taxes and less state involvement in the economy, then they must step up their social responsibility. If people got paid better, they wouldn’t need to rack up private debt or fall back on government programs to get buy. East Asian countries can get away with low taxes and low public spending partly because their communitarian societies, for the most part, take care of each other. It’s not a perfect arrangement, obviously, but it’s something to consider.
Whatever the case may be, this arrangement cannot lot. As history has shown time and again, a society cannot sustain such vast inequities – and the social dysfunctions that emerge as a result – for very long.