January 27 “Just as American billionaires make a lot of money during the pandemic, millions of Americans fall below the poverty line.” CNN posted on the 26th that the wealth of billionaires in the United States has increased by $1.1 trillion since March 2020.
However, in the second half of the same year, more than 8 million Americans fell into poverty, in sharp contrast to the inequality crisis in the United States. Drama.
Increasing inequality crisis
According to a recent report released by the Institute for Policy Studies and the American Society for Tax Fairness on the 26th, since mid-March 2020 By way, the wealth owned by American billionaires increased by $1.1 trillion in total.
CNN said that in other words, the super-rich not only “recovered back” from the economic losses last spring, but many people are in a better position than before, largely due to the strong stock market.
For example, due to Tesla’s sharp rise in market capitalization, the wealth of Elon Musk, the company’s CEO, has increased to $155 billion.
According to the report, 46 people have joined the ranks of American billionaires since March 18, 2020.
At present, the country’s 660 billionaires have a total wealth of $4.1 trillion, two-thirds more than the wealth owned by 50% of Americans at the bottom of their income.
“It’s clear that the coronavirus pandemic is exacerbating the already disturbing crisis of inequality in the United States.” The article said that the amazing increase in wealth of the top group contrasts sharply with the economic difficulties of the bottom group, and many low-income people bear the brunt of the epidemic and are forced to lose their jobs or cut their wages.
The poverty rate has risen sharply.
Real-time estimates from economists from the University of Chicago, Notre Dame and the Economic Opportunity Laboratory show that more than 8 million Americans will fall into poverty in the second half of 2020.
In the first few months of the outbreak, the poverty rate in the United States fell, largely due to the stimulus measures introduced by the federal government.
However, in the second half of the same year, the poverty rate in the United States rose by 2.4 percentage points, almost twice the highest annual increase in the poverty rate in the United States since the 1960s.
Some groups have been hit harder than others. Economists have found that the poverty rate of African-Americans is currently 5.4 percentage points higher than in June 2020, that is, 2.4 million people are trapped in poverty.
For those with high school education or lower, the poverty rate soared to 22.5% from 17% in June last year.
In terms of regional distribution, Florida, Mississippi, Arizona and North Carolina have the largest increase in poverty.
The report said the results of the state survey showed that “in states with less efficient unemployment insurance systems, poverty rates have risen faster.”
CNN believes that statistics on rich and poor provide more evidence for the “k-shaped” economic recovery theory of the United States. U.S. stock markets hit new highs, housing markets and big tech companies thrive.
However, other industries such as aviation, catering, hotels and cinemas are still in chaos.
Janet Yellen, the new Treasury Secretary of the U.S. government, admitted the problem and said that it was nothing new.
“Before the first COVID-19 case in the United States, we lived in a ‘K’ economy where money could roll, while working families were increasingly left behind,” Yellen said.
Yellen called on Congress to take action to narrow the gap between rich and poor and launch a rescue package.
The stock market benefits the rich.
During the epidemic, the U.S. real estate market turned profits instead. In 2020, the sales volume of existing houses reached the highest level in 14 years, and house prices rose to an all-time high. At the same time, the stock market plays an important role in the polarization between rich and poor in the United States. While the U.S. economy has not fully recovered from the pandemic, the S&P 500 index is up 72% from its March 2020 low. The article said that this “V” recovery is based on a series of stimulus measures, but these measures are essentially forcing investors to bet on the stock market.
“It’s not surprising that the soaring stock price has made the rich people profitable.” CNN cited Tesla’s soaring share price to boost Musk’s wealth by more than 600%; Amazon founder and CEO Jeff Bezos’ wealth increased by more than $68 billion during the pandemic. Facebook co-founder and CEO Mark Zuckerberg is $37 billion more than his fortune in March 2020.
According to the Federal Reserve, as of early 2020, the richest 10% of households in the United States accounted for 87 percent of all stocks and mutual funds in the country. By contrast, millions of less wealthy Americans do not feel the benefits of the stock market boom.
