The Economic Policy Institute has put together an amazing interactive chart that shows the growth of incomes in the US over the past 90 years--broken down by who the gains went to.

(Thanks to Barry Ritholtz, for alerting us to this and for running some numbers himself.)

By adjusting the sliders on the chart, you can break down the period into different eras, which show startlingly different trends.

Over the entire period, the picture looks okay (okay--not great): Average U.S. incomes grew by $38,000, adjusted for inflation. About half of these gains went to the richest 10% of the country. The other half went to the other 90%.

Income Inequality 1917-2008 hi-res

Image: Economic Policy Institute

 

And now let's break down the last 90 years into different eras...

Over the first three-quarters of the period, from 1917-1981, the picture looks better: Average incomes rose by $26,000. The richest 10% captured 31% of that growth, and the other 90% captured 59%.

Income Inequality, 1917-1981 hi-res

Image: Economic Policy Institute

 

But then we come to the last 30 years.

Over the past three decades, the picture changes--radically. From 1981-2008, average incomes grew by a healthy $12,000. But a shocking 96% of that growth went to the richest 10% of the country. Only 4% of it went to the other 90%.

Income Inequality, 1981-2008

Image: Economic Policy Institute

 

And then there's the last 10 years...

From 1997-2008, average incomes grew by $2,700. All of these gains went to the richest 10%. The incomes of the other 90% declined.

Income Inequality 1997-2008 hi-res

Image: Economic Policy Institute

 

That's worth saying again:

In the past 30 years, 96% of the growth of average incomes in this country have gone to the richest 10% of the country. And in the past 10 years, the incomes of the other 90% have declined.

You'd certainly have to be a member of the top 10% to think that the trend over the past 30 years is okay. You'd also have to be pretty short-sighted. Because if that trend continues, and if you're in the top 10% because you own or work for a company that serves the other 90%, demand for your products will soon be going down.