News Journal: The wealthy are winning in America, but what about the rest of us?

Class warfare! During the 40-plus years I’ve been in politics, anyone who challenged a tax plan that favored the wealthy was accused of waging it by right-wing media and politicians.
Let upper-income households keep more of their money, they always argued. The economy would then take off and benefits would trickle down to everyone else.
More from this writer: Gridlocked Congress is nobody’s fault but ours
If you disagreed with that, you were fomenting class warfare, pitting the middle class against the rich.
I always put the argument in the “it would be funny if it weren’t so sad” category. But Warren Buffet, a multi-billionaire, probably said it best: “There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning.”
In fact, the very rich have been winning spectacularly over the past 40 years. Let’s look at some numbers that explain exactly what has happened since 1981.
That’s when the first Reagan tax cuts were enacted. Since then, according to the World Wealth and Income Database, the total income of the top one hundredth of one percent Americans grew over 300 percent. Total income among the rest of us remained about the same.
Studies by Emmanuel Saez and Thomas Piketty found that the total income of that top one hundredth of one percent amounts to almost 200 times more than the total income of the bottom 90 percent of Americans.
Saez and Piketty used census data to determine that, since 1980, the median household income had increased 16 percent at the same time there was a GDP growth of 154 percent. Corporate profits grew 182 percent and the income of the top 1 percent, including their capital gains, grew by 190 percent.
In 2015, half of all the annual income in the United States went to the top 10 percent.
In his study of “Household Wealth Trends in the United States, 1962-2013,” Ed Wolff found that “between 1983 and 2013, the top one percent received 41 percent of the total growth in net worth, 43 percent of the total growth in non-home wealth, and 49 percent of the total increase in income. The figures for the top 20 percent are 99 percent, 98 percent, and 103 percent, respectively — that is to say, the upper quintile got it all!”
So the rich got richer. But what about the middle class?
According to a research study entitled ‘The American Middle Class Is Losing Ground” conducted by the Pew Foundation, “the hollowing of the American middle class has proceeded steadily for more than four decades. Since 1971, each decade has ended with a smaller share of adults living in middle-income households than at the beginning of the decade, and no single decade stands out as having triggered or hastened the decline in the middle.”
Based on the definition used in this Pew report, the share of American adults living in middle-income households has fallen from 61 percent in 1971 to 50 percent in 2015.
Pew concludes “the gaps in income and wealth between middle- and upper-income households widened substantially in the past three to four decades. As noted, one result is that the share of U.S. aggregate household income held by upper-income households climbed sharply, from 29 percent in 1970 to 49 percent in 2014. More recently, upper-income families, which had three times as much wealth as middle-income families in 1983, more than doubled the wealth gap; by 2013, they had seven times as much wealth as middle-income families.”
Take my word that I haven’t cherry picked these numbers. I could have cited dozens of other studies that have come to the same basic conclusions. Few if any economists argue with the fact that we have lived through an historic shift of wealth in the past few decades.
If you believe, as I do, that a thriving middle class is essential to the success of our democracy, the vast increase in income inequality is a dangerous trend.
Which brings me to the newest Republican tax plan. If enacted, it will exacerbate this trend and accelerate the continuing shrinkage of the middle class.
I’ll explain how and why in my next column.
Ted Kaufman is a former U.S. Senator from Delaware.