Statement from Jonas Shaende, Chief Economist:
“While most New Yorkers, like most Americans, tend to think
of themselves as middle-class, the truth is that New York State is unequaled in
income inequity. For the majority, it is harder than ever just to keep pace,
and many are even falling behind. Unless we act to grow and strengthen the
middle class, the income gap will continue to widen, and more New Yorkers will
find themselves economically disadvantaged.”
By 2015, the top 1 percent of New Yorkers captured nearly
one-third of all income (nearly 10 percentage points more than the national
average and at an accelerating pace) while most workers found themselves
excluded from such striking -- or even modest -- real income gains. Since 1973,
across the nation and in our state, despite the multiple periods of economic
instability, the top 1 percent of income earners have captured a more significant
share of income growth than the bottom 99 percent.
Far from immune to the growing wealth gap, the middle class
is under stress. Post-war economic and social policies were designed to grow
and strengthen the middle class by ensuring that the larger share of income
gains went to the bottom 99 percent of the country’s income earners. While
racism and discrimination undeniably limited the reach of these policies, by
keeping African Americans, women, and other groups from sharing in the economic
gains. Nonetheless, the post-war experience shows that the U.S. economy is
capable of strong growth paired with a large and growing middle class. There is
no reason middle-class growth could not be achieved today while also including
these previously excluded groups in the shared prosperity.”
New York is a particularly extreme example, but rising
inequality is a problem across all areas of the nation. Now is our chance to
reverse the trend and lead the country by adopting sound economic and social
policies that promote growth and development for the many rather than the few
so that all New Yorkers have an equal chance at opportunity.
FPI urges Governor Andrew Cuomo and the New York State
Legislature to implement responsible tax policies such as strengthening and expanding
the Earned Income Tax Credit and Empire State Child Credit; closing tax
loopholes and rethinking the tax rate for the top 1 percent; increasing job opportunity by investing in
infrastructure and renewable resources; and boosting job quality with stronger
labor standards; and preparing for the future with adequately funded
child-care, K-12 education and higher education programs. Read the report
The Fiscal Policy Institute is a nonpartisan, nonprofit
research and education organization committed to improving public policies and
private practices to better the economic and social conditions of all.
