The Rich Get Richer

On September 16^th Forbes magazine released the annual Forbes 400 list of billionaires. The “Facts and Figures” article by Luisa Kroll dissects the report and summarizes the methodology used to collect the data.

The highlights are listed first, Bill Gates is once again the richest in the world and Mark Zuckerberg has made it back to the top 20. “The 400 wealthiest Americans are worth just over $2 trillion, roughly equivalent to the GDP of Russia. That is a gain of $300 billion from a year ago, and more than double a decade ago. The average net worth of list members is a staggering $5 billion, $800 million more than a year ago and also a record.”

The article continues, “Five years after the financial crisis sent the fortunes of many in the U.S. and around the world tumbling, the wealthiest as a group have finally gained back all that they lost.” The question that came to my mind, gained it back from who?

And then I saw the article from the New York Times, “Despite the addition of more than two million jobs last year, soaring corporate profits and continuing economic growth, income for the typical American household did not rise in 2012 and poverty failed to fall, new data from the Census Bureau show.”

It is important to note that these reports were released within days of one another. Perhaps after learning that "The 400 wealthiest Americans are worth just over $2 trillion, roughly equivalent to the GDP of Russia. That is a gain of $300 billion from a year ago, and more than double a decade ago. The average net worth of list members is a staggering $5 billion, $800 million more than a year ago and also a record,” the Times felt a comparison article was in order, or maybe it was just the timing of the Census Bureau report.

The Times also reports, “...economists believe that the report understates the degree of income inequality in the United States, by not including, among other things, earnings from capital gains made on rising stock prices.”

According to the very informative section on methodology in the Forbes report, many billionaires were left off the list because their fortunes are dispersed among family members or their net worth, while over $1 billion, was not high enough for this particular study.

Reading these articles side by side seems to confirm the growing awareness of the income gap between the rich and the poor. I think it is worth noting that the majority of high ranking billionaires made their fortunes in the computer and information based industries. I have to ask, do the tax code and patent laws favor these industries? Do the companies providing jobs associated with these industries have more responsibility to the public they are making so much money from? Can the free market be trusted to “trickle down”? I also can't help but think that these tech gurus should have invested more in the public education that could support their industries in country.

http://www.forbes.com/sites/luisakroll/2013/09/16/inside-the-2013-forbes-400-facts-and-figures-on-americas-richest/

http://www.nytimes.com/2013/09/18/us/median-income-and-poverty-rate-hold-steady-census-bureau-finds.html?ref=todayspaper&_r=1