THE RICH GOT RICHER

Income inequality has worsened over the past decade—an issue that has angered and frustrated voters who view the economy as being rigged against them. Much of the increased wealth gap reflected the nature of a recovery that depended on a stock market boom made possible, in part, by the Fed’s slashing rates to near-zero to help pull the economy out of its tailspin.

Because wealthier Americans own the bulk of U.S. stocks, they reaped the benefits. They were also less likely to lose a house and more likely to keep a job. Research has found that they also spent more on education for their children. That helps set up another generation of income inequality because investments in schooling tend to lead to higher future incomes.

Last year, the top 5 percent of households earned an average income of $385,389, according to the Census Bureau. That is 6.26 times more than the average income of $61,564 for the middle 40 to 60 percent of households. Back in 2008, the top 5 percent made 5.88 times more than middle-income Americans.

This recovery is radically different from the aftermath of the Great Depression, the event that many economists consider to be comparable to the 2008 financial meltdown. The proportion of wealth controlled by the top 10 percent began to decline after 1932, a trend that stretched for decades until 1986. But after the Great Recession, the proportion of wealth held by the top 10 percent rose.

— Josh Boak