Income and wealth inequality in America are “very worrisome,” Federal Reserve Chair Janet Yellen told Sen. Bernie Sanders at a congressional hearing on Wednesday. In her first appearance before Congress as the nation’s central banker, the new Fed chief told Sanders that “there is no question that we’ve had a trend toward growing inequality and I personally find it a very worrisome trend that deserves the attention of policy makers.” Yellen added that “it greatly concerns me” that the growing wealth and income gap “can shape and determine the ability of different groups to participate equally in the democracy and have grave effects on social stability over time.”
Sanders, a member of the Joint Economic Committee, questioned Yellen about a recent study by Princeton and Northwestern professors on how a small number of powerful players are taking over our democracy. “If policymaking is dominated by powerful business organizations and a small number of affluent Americans, then America's claims to being a democratic society are seriously threatened,” Princeton’s Martin Gilens and Northwestern’s Benjamin Page asserted. “When a majority of citizens disagrees with economic elites and/or with organized interests [in the U.S.], they generally lose,” the professors wrote. “Moreover, even when fairly large majorities of Americans favor policy change, they generally do not get it.”
In the richest country on earth, Sanders said, almost all of the new wealth and income flows to the top 1 percent, creating the most unequal distribution of wealth and income of any major country in the world. As a consequence, the senator added, the middle class is disappearing and more Americans living in poverty today than at any time in our nation’s history.
The richest 400 Americans today own more wealth than the bottom half of the population – more than 150 million Americans. The top 1 percent owns about 38 percent of the financial wealth of America. The bottom 60 percent owns a mere 2.3 percent.
Today, the Walton family — the owners of Wal-Mart and the wealthiest family in America — is now worth $148 billion, which is more wealth than the bottom 40 percent.
From March of 2013 to March of 2014, the industrialists Charles and David Koch increased their wealth by $12 billion – from $68 billion to $80 billion. Bloomberg now estimates that the Koch brothers are worth more than $100 billion.
Las Vegas casino magnate Sheldon Adelson, increased his wealth by $11.5 billion since last year and is now worth over $38. billion.
In terms of income, 95 percent of all new income generated in this country went to the top one percent from 2009-2012, the latest information available.
Meanwhile, almost 22 percent of American children are living in poverty and we have the highest rate of childhood poverty of any major country on earth.
The typical middle-class American family earned less income last year than it did 25 years ago – back in 1989.
As a result of the Supreme Court decision in Citizens United and other cases, the wealthiest people and largest corporations in this country can now spend an unlimited sum of money to influence the political process.