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To: Bobby Yellin who wrote (39994)	9/5/1999 5:44:00 AM
From: Alex	Read Replies (2) \| Respond to of 116972

U.S. Study Shows Widening Gap Between Rich & Poor By Michiyo Yamada WASHINGTON (Reuters) - The after-tax income gap between rich and poor Americans has widened sharply since 1977, reaching a record high in 1999, according to a study released Saturday. The study, ``The Widening Income Gulf,' conducted by the Washington think tank Center on Budget and Policy Priorities, used the U.S. Congressional Budget Office (CBO)'s income and tax data, which the center said provide the most comprehensive measure of disposable income. The data include capital gains, quantify the effect of federal taxes and adjust by family size. The study concludes that the average annual after-tax income of the richest 1 percent of Americans, or 2.7 million people, has more than doubled since 1977, and is projected to exceed $515,000 in 1999; while the poorest 20 percent's after-tax income is expected to average just $8,800 in 1999. For the richest 20 percent of households, the number is expected to increase 43 percent during the same period, averaging more than $102,000 a year. The center's Isaac Shapiro, who managed the study, said the after-tax income share of the richest 2.7 million people in 1999 matched that of the bottom 38 percent of the population, embracing about 100 million people. Tax cuts from the late 1970s and early 1980s disproportionately benefited the rich, Shapiro said. If the richest 1 percent of families were to pay the same percentage of their income in federal taxes in 1999 as they did in 1977, they would have to pay an average of at least $40,000 more in 1999 than they will actually pay, Shapiro said. Steady economic expansion over the past eight years has swollen the U.S. Treasury's coffers and set the government on a course of annual budget surpluses expected to last through 2009 and produce an accumulated surplus of about $3 trillion, according to the center's interpretation of CBO data. Robert Greenstein, executive director of the center, said the study's findings raised the question of what to do with that projected surplus. ``The question that these data raise is, if the group at the top of the income spectrum has been doing so well ... why does that group ... need another large income tax cut?', he asked. The researchers also attributed the rising income gap to changes in the economy, including increased global trade, innovations in technology and weaker labor unions. dailynews.yahoo.com