Rising Inequality With US among Worst

OECD Report Finds Rising Income Inequality With U.S. Among Worst

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October 21, 2008 12:42 p.m. EST

Linda Young - AHN Editor

Washington, D.C. (AHN) - Only two of 30 nations, Mexico and Turkey, are ahead of the United States for income inequality and poverty rates, or the gap between rich and poor, according to a report released Tuesday.

The report was released by Paris-based Organization for Economic Cooperation and Development of its 30 member-nations, most of which are developed countries.

In America, the average income of the richest 10 percent of people is $93,000. When compared to purchasing power parity, it is the highest in the OECD when compared with the average of $54,000 for OECD nations.

The poorest 10 percent of Americans have an income of $5,800 per year, compared to the OECD average of $7,000.

In addition, the richest 10 percent hold 71 percent of American's net worth and 28 percent of total income, leaving 90 percent of the population to split the remaining 72 percent of the nation's income.

While income inequality grew worse in the U.S., it decreased in France over the past 20 years because poorer workers were paid better.

The OECD report found that economic growth of recent decades benefited the rich more than the poor and in Canada, Finland, Germany, Italy, Norway and the United States, the gap also increased between the rich and the middle-class.

Social mobility is lower in countries such as Italy, the United Kingdom and the United States where there is a wide distribution of income and higher in Nordic countries where income is distributed more evenly, the OECD said in a statement on its website.