Two recent studies released by the Center on Budget and Policy Priorities show that the nation's income gap is widening and that the number of people living in poverty is increasing. The first study, released on September 26th, deals with poverty. Between 2001 and 2002, the poverty rate rose from 11.7 percent to 12.1 percent, an increase of 1.7 million people. The study also found that median incomes fell by 1.1 percent. In the other report, released on September 23rd, the CBPP reported that over the past twenty-four years, the nations income disparity increased significantly. Based on the increase in the poverty rate as well as the fall in the median income over the past two years, it is likely that income inequality will continue to rise on into the foreseeable future because of the Bush tax cut plans of 2001, 2002 and 2003. All three, while clouded in rhetoric about the stimulative and balanced nature of the effects, really constitute a huge giveaway to the rich. The September 23rd report noted that throughout the period between 1979 and 2000, taxes on the richest one percent of the population had fallen consistently.

What do these reports mean for the future? When combined with the projected deficits over the next ten years, the evidence points towards a future U.S. which resembles more of a banana republic. With the tax system becoming less progressive at the federal level (and regressive at the state and local levels), sooner or later, unless the tax cuts are repealed, the government will be forced to make deep cuts in social services. Paul Krugman has repeatedly emphasized that this is exactly what the Bush Administration wants. It wants to put the fiscal situation in the U.S. in such dire straits that previously shielded many social programs from cuts, such as Social Security and Medicare. Furthermore, with fewer and fewer social services for the poor and a larger and larger income disparity between rich and poor, the country is more likely to see more social tension between those who have money and those who do not. This is a situation akin to the developing world and is unacceptable.

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©2003 Richard B. Goud, Jr.
Updated at 17:26 PST on 27 September 2003