Obama's War On The Middle Class Is Working. His Friends Are Doing Just Fine.

Only The Rich Are Getting Richer In The Obama Era

September 8, 2014 by Ben Bullard 

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The September bulletin from the Federal Reserve includes an observation that presents a problem for the Obama administration’s avowed war on income inequality: Over the past three years, only the very rich have increased their wealth. On average, everyone else — and that’s roughly 97 percent of all Americans — is either treading water or drowning.

According to the Fed bulletin, the wealth held by the richest Americans has surged to historically high levels, but it’s not a trend that extends to the upper-middle, middle and lower classes — in other words, the vast majority.

Here’s how the Fed’s Board of Governors describes the disparity:

Income inequality, particularly the share of income received by the top 1 percent of the income distribution, has received increased attention in recent years. The Survey of Consumer Finances (SCF) is uniquely capable of contributing to our understanding of trends in income and wealth inequality because the survey collects data on net worth in addition to income, and it also effectively samples affluent families.

Data from the 2013 SCF confirm that the shares of income and wealth held by affluent families are at modern historically high levels. Also, the gains in income and wealth shares have been concentrated among the top few percentiles of the distribution. Contrary to some analysis of Internal Revenue Service data indicating wealth gains are isolated to the top 1 percent, or even 0.5 percent, data from the SCF show that the top few percent of families have experienced rising shares of income and wealth.

The bulletin goes on to show that only the top three percent of income earners in the U.S. has both rebounded from and added to their wealth since the general economic downturn beginning in 2007. 

The Fed bulletin came only days ahead of the latest data dump from the Bureau of Labor Statistics, which revealed that the nation added some 60,000 fewer jobs in August than the already-tepid 200,000 jobs most economists had expected.