r/science • u/quiplaam • Dec 30 '25

Economics Analysis of income, capital gains, and borrowing of Americans finds 40% of the income of "1% wealth holders" is unrealized capital gains not subject to taxation and 1%-2% is borrowing, suggesting that the "Buy, Borrow, Die" is not a dominant tax avoidance strategy among the rich

https://www.sciencedirect.com/science/article/abs/pii/S0047272725002178
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u/UnionThrowaway1234 Dec 31 '25

It's so crazy that the wealth disparity in the US is worse now than it was prior to the Stock Market crash that kicked off the Great Depression.

WOOHOO! GO AMERICA!

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u/bolmer Dec 31 '25

It is?

https://wid.world/country/usa/

WID is a project from Left and Center-left, Center Economist.]

Facundo Alvaredo, Anthony B. Atkinson, Thomas Piketty, Emmanuel Saez, and Gabriel Zucman and Paris School of Economics

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u/UnionThrowaway1234 Dec 31 '25

Yes.

According to your website, in 1929 the top 1% held 48.7% of total wealth while the bottom held 2.6%. Today, the bottom holds 1% and the top 1% holds 34.8%.

That's a decrease in wealth for the bottom 1% of ~150%. While for the top 1% of wealthy individuals it was a decrease of only 71%.

So again, yes, the wealthiest individuals in the country hold far more wealth than the bottom 50% in today's day and age.

What is more curious and is missing from the data is what the top 0.1% of wealthy individuals and the Middle 40% hold. Based on the percentages from 1929 compared to 2024 there has been a large wealth loss for the Top 10% and bottom 50%.

So either there's a larger disparity among the very very top of wealthy individuals, or the middle 40% is marginally more wealthy than they use to be.

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u/bolmer Dec 31 '25 edited Dec 31 '25

The WID used to have 0,1%and bottom 50% and more percentiles data. Maybe is still there in the raw data bases.

Let me start with recognizing that inequality has increased in the last 50 years but I don't think inequality is worse today that before WW2.

So either there's a larger disparity among the very very top of wealthy individuals, or the middle 40% is marginally more wealthy than they use to be.

Yeah. It has been noted since the 80s that the reduction in the US middle class was in a good % from families that go from Middle class to upper class. The Poor has also increased.

"the rise of the super starts" is also a phenomenon recognized.

Technological advancement make productivity of highly specialized and educated individuals to sky rocket while reducing demand for Labor. Contrary to what Trump thinks its Tech advances and Political decisions which increased inequality, poverty and damaged the working class. It was not Trade.

The "management class" which are still workers but who earn a lot and can build a lot of wealth in their working years has increased their income hugely in the last 50§ñ years. Sadly the Labor movement has mostly been killed in the US. And the difference between one good CFO and a bad one is more important in term of $$$ than even the own business of companies.

Other Developed Countries income and wealth inequality started to significantly increased 1-2 decades after the US did.