Posted: Monday, 19 November 2012 5:24AM

Ohio's Wealth & Income Gap Widening



A new study based on census figures shows the gap between the rich and poor continues to grow.
 
Analysts say it's becoming a serious issue for the economy. The figures show the top fifth of wage earners in Ohio have seen incomes grow by more than 50 percent since the 1970s.
 
And Amy Hanauer with Policy Matters Ohio says the state's low- and middle-income families have seen their incomes drop in the short term and stagnate in the long term, while earning just a fraction of what the wealthiest make.
 
 
According to Elizabeth McNichol with the Center on Budget and Policy Priorities in Washington, the gap has grown nationally for three decades, but has become worse in the last ten years.
 
 
McNichol says inequality is bad because it makes the economy less flexible. And she says people who work hard and play by the rules should be rewarded.
 
 
According to the report, the average income of the top fifth of households in Ohio was nearly seven times greater than the average income of the bottom fifth.
 
Hanauer says sharp cuts in taxes on the most affluent have worsened the income gap and diverted needed revenue from important public services.
 
 
Economists stress that rising inequality is not inevitable, that the gap between rich and poor actually fell between World War Two and 1970.  And they say it also fell for a brief period during the economic growth in the late 90s. They say part of that was due to a rise in the minimum wage and the federal Earned Income Tax Credit.
 


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