America’s 20 richest people have more money than these 152 million people

2015-12-02

This statistic might even make the 1% feel humbled.

America’s 20 wealthiest people — a group that could fit in one Gulfstream G650 jet — are now worth $732 billion, which means they have more wealth than the 152 million people who make up the least wealthy 50% of U.S. households, according to a report released Wednesday by the Institute for Policy Studies. What’s more, the “Forbes 400” wealthiest individuals in the U.S. now have a net worth of $2.34 trillion.

“There is a growing concentration of wealth in fewer and fewer hands,” says Josh Hoxie, who heads up the Project on Opportunity and Taxation at the institute.

The report’s co-authors — Hoxie and Chuck Collins, a senior scholar at the Institute for Policy Studies, a Washington, D.C.-based think tank that focuses on economics, national security and human rights — propose several ways to close the gap between America’s ultra-wealthy and, well, everyone else. These policies include closing offshore tax havens and loopholes for the ultra-wealthy in the tax code that the wealthy exploit to hide their wealth. One of the biggest billionaire loopholes is the Grantor Retained Annuity Trust, which enable very wealthy families to pay little if any estate and gift tax on estates worth billions of dollars, Hoxie says. “There’s no reason why it should be used as a tax evasion mechanism,” he says. “It’s an unintended result of our tax code.” He also proposes a direct tax on wealth to generate trillions of dollars in new revenue.

A 1% tax on the wealthiest 1% of Americans would raise $2.6 trillion over 10 years, more than the federal government now spends on education and environmental protection combined, the report says, and a 1% tax exclusively on the Forbes 400 would raise $234 billion, which is more than the government spends on both its Head Start program, which provides early childhood education to over 800,000 low-income children, and the Women, Infant, and Children (WIC) program that provides nutrition assistance to over half of all infants born in the U.S.

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“Interest in addressing inequality has increased in recent years, but Congress hasn’t introduced a wealth tax yet,” Hoxie says. (The report used data from the Forbes 400, the U.S. Federal Reserve Survey of Consumer Finance and the U.S. Census.)

The middle class, meanwhile, is still recovering from the Great Recession. The net worth of American families — that is, the difference between the values of their assets, including homes and investments, and liabilities — hovers at around $81,400, still a long way off the $135,700 in 2007, according to a report released last January by the nonprofit think tank Pew Research Center in Washington, D.C.

Meanwhile, the 2015 Forbes Billionaires List names 1,826 billionaires with an aggregate net worth of $7.05 trillion, with 400 new billionaires joining the elite club this year, which increased their collective net worth by nearly $2 trillion in two years. On the upside, some 700 million Americans managed to step out of povertybetween 2001 and 2011, according to Pew.