Inequality Grows Worse: The Oregon Experience

The Oregon experience, as presented in the following charts from the Oregon Center for Public Policy, provides one illustration of the skewed nature of the workings of our economy.

As we can see in the chart below, which draws on state tax records, the average inflation-adjusted income of the state’s top 1 percent income earners has soared since the 1980s.  By contrast the state’s real median income actually declined over the same period.

one percent

In case you are wondering, one had to make at least $336,420 in 2013, the year with the most recent data, to be in the top group; the group’s average income that year was $770,000.  The median income in 2013 was $32,537, which was approximately $141 less than in 1980 adjusted for inflation.

Moreover, while the average income of the top group rose by $80,697 over the period 2009 to 2013, median income actually fell by $388 over the same time period.  In other words the average worker has not benefited from the post-2009 expansion.

Even this picture of inequality understates the extent of the problem.  Next we see the rise in the income of the top 1/10 of 1 percent compared to the rest of the top 1 percent.

one tenth percent

It took about $1.3 million in 2013 to make the top group.  The average income of the top one-tenth of 1 percent was approximately $3.1 million.

Can we put a rough price tag on the cost of this inequality?  The Oregon Center for Public Policy had this to say:

In 1980, the median household income was about 10 percent of the average income of the top 1 percent.  By 2013, because the top 1 percent had such big gains, the median household income had shrunk to just four percent of the top 1 percent’s average income.

Had income inequality remained at its 1980 level, the 2013 median income would have been $78,125 or more than twice what it actually was ($32,537).


Economic analysts are now debating whether the Federal Reserve should raise interest rates to cool down the economy, as if most Americans have been enjoying a healthy recovery.  Instead we should be debating the best ways to restructure ownership and work relations to ensure an appropriate distribution of the fruits of our collective labor.


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