Poor get poorer as recession threat looms: report

[babylonsister]

Poor get poorer as recession threat looms: report
Wed Apr 9, 2008 4:26am EDT

By Lisa Lambert


WASHINGTON (Reuters) - The gap between rich and poor in many states has broadened at a quickening pace since the last U.S. recession, which could make it difficult for low-income families to weather the current economic downturn, according to a report issued Wednesday.

Since the late 1990's average incomes have declined 2.5 percent for families on the bottom fifth of the country's economic ladder, while incomes have increased 9.1 percent for families on the top fifth, said the report from the liberal-leaning Center on Budget and Policy Priorities and Economic Policy Institute.

The result is that the average incomes of the top five percent of families are 12 times the average incomes of the bottom 20 percent.

"The report's bottom line is that since the late 1980's income gaps widened in 37 states and have not narrowed in any states," said Jared Bernstein, one of the report's authors. "In fact, we've found that the trend toward growing inequality has accelerated during this decade."

Meanwhile, the middle class has remained virtually stagnant, with average incomes growing by just 1.3 percent in nearly eight years, the report said.

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