Marxism is a theory and method of working class self-emancipation. As a theory, it relies on a method of socioeconomic analysis that views class relations and social conflict using a materialist interpretation of historical development and takes a dialectical view of social transformation, it originates from the works of 19th-century German philosophers Friedrich Engels. Marxism uses a methodology, now known as historical materialism, to analyze and critique the development of class society and of capitalism as well as the role of class struggles in systemic economic and political change. According to Marxist theory, in capitalist societies, class conflict arises due to contradictions between the material interests of the oppressed and exploited proletariat—a class of wage labourers employed to produce goods and services—and the bourgeoisie—the ruling class that owns the means of production and extracts its wealth through appropriation of the surplus product produced by the proletariat in the form of profit.
This class struggle, expressed as the revolt of a society's productive forces against its relations of production, results in a period of short-term crises as the bourgeoisie struggle to manage the intensifying alienation of labor experienced by the proletariat, albeit with varying degrees of class consciousness. In periods of deep crisis, the resistance of the oppressed can culminate in a proletarian revolution which, if victorious, leads to the establishment of socialism—a socioeconomic system based on social ownership of the means of production, distribution based on one's contribution and production organized directly for use; as the productive forces continued to advance, Marx hypothesized that socialism would be transformed into a communist society: a classless, humane society based on common ownership and the underlying principle: "From each according to his ability, to each according to his needs". Marxism has developed into many different branches and schools of thought, with the result that there is now no single definitive Marxist theory.
Different Marxian schools place a greater emphasis on certain aspects of classical Marxism while rejecting or modifying other aspects. Many schools of thought have sought to combine Marxian concepts and non-Marxian concepts, which has led to contradicting conclusions; however there is movement toward the recognition that historical materialism and dialectical materialism remains the fundamental aspect of all Marxist schools of thought. Marxism has had a profound impact on global academia and has influenced many fields such as archaeology, media studies, political science, history, art history and theory, cultural studies, economics, criminology, literary criticism, film theory, critical psychology and philosophy; the term "Marxism" was popularized by Karl Kautsky, who considered himself an "orthodox" Marxist during the dispute between the orthodox and revisionist followers of Marx. Kautsky's revisionist rival Eduard Bernstein later adopted use of the term. Engels did not support the use of the term "Marxism" to describe either his views.
Engels claimed that the term was being abusively used as a rhetorical qualifier by those attempting to cast themselves as "real" followers of Marx while casting others in different terms, such as "Lassallians". In 1882, Engels claimed that Marx had criticized self-proclaimed "Marxist" Paul Lafargue, by saying that if Lafargue's views were considered "Marxist" "one thing is certain and, that I am not a Marxist". Marxism analyzes the material conditions and the economic activities required to fulfill human material needs to explain social phenomena within any given society, it assumes that the form of economic organization, or mode of production, influences all other social phenomena—including wider social relations, political institutions, legal systems, cultural systems and ideologies. The economic system and these social relations form a superstructure; as forces of production, i.e. technology, existing forms of organizing production become obsolete and hinder further progress. As Karl Marx observed: "At a certain stage of development, the material productive forces of society come into conflict with the existing relations of production or—this expresses the same thing in legal terms—with the property relations within the framework of which they have operated hitherto.
From forms of development of the productive forces these relations turn into their fetters. Begins an era of social revolution"; these inefficiencies manifest themselves as social contradictions in society which are, in turn, fought out at the level of the class struggle. Under the capitalist mode of production, this struggle materializes between the minority who own the means of production and the vast majority of the population who produce goods and services. Starting with the conjectural premise that social change occurs because of the struggle between different classes within society who are under contradiction against each other, a Marxist would conclude that capitalism exploits and oppresses the proletariat, therefore capitalism will lead to a proletarian revolution. Marxian economics and its proponents view capitalism as economically unsustainable and incapable of improving the living standards of the population due to its need to compensate for falling rates of profit by cutting employee's wages, social benefits and pursuing military aggression.
The socialist system would succeed capitalism as humanity's mode of production through workers' revolution. According to Marxian crisis theory, socialism is not an economic necessity. In a sociali
Economic inequality covers a wide variety of topics. It can refer to the distribution of wealth. Besides economic inequality between countries or states, there are important types of economic inequality between different groups of people. Important types of economic measurements focus on wealth and consumption. There are many methods for measuring economic inequality, with the Gini coefficient being a used one. Another type of measure is the Inequality-adjusted Human Development Index, a statistic composite index that takes inequality into account. Important concepts of equality include equity, equality of outcome, equality of opportunity. Research suggests. Whereas globalization has reduced global inequality, it has increased inequality within nations. In 1820, the ratio between the income of the top and bottom 20 percent of the world's population was three to one. By 1991, it was eighty-six to one. A 2011 study titled "Divided we Stand: Why Inequality Keeps Rising" by the Organisation for Economic Co-operation and Development sought to explain the causes for this rising inequality by investigating economic inequality in OECD countries.
Single-headed households in OECD countries have risen from an average of 15% in the late 1980s to 20% in the mid-2000s, resulting in higher inequality. Assortative mating refers to the phenomenon of people marrying people with similar background, for example doctors marrying doctors rather than nurses. OECD found out that 40% of couples where both partners work belonged to the same or neighbouring earnings deciles compared with 33% some 20 years before. In the bottom percentiles number of hours worked; the main reason for increasing inequality seems to be the difference between the demand for and supply of skills. Income inequality in OECD countries is at its highest level for the past half century; the ratio between the bottom 10 % and the top 10 % has increased to 1:9 in 25 years. There are tentative signs of a possible convergence of inequality levels towards a common and higher average level across OECD countries. With few exceptions, the wages of the 10% best-paid workers have risen relative to those of the 10% lowest paid.
A 2011 OECD study investigated economic inequality in Argentina, China, Indonesia and South Africa. It concluded that key sources of inequality in these countries include "a large, persistent informal sector, widespread regional divides, gaps in access to education, barriers to employment and career progression for women."A study by the World Institute for Development Economics Research at United Nations University reports that the richest 1% of adults alone owned 40% of global assets in the year 2000. The three richest people in the world possess more financial assets than the lowest 48 nations combined; the combined wealth of the "10 million dollar millionaires" grew to nearly $41 trillion in 2008. A January 2014 report by Oxfam claims that the 85 wealthiest individuals in the world have a combined wealth equal to that of the bottom 50% of the world's population, or about 3.5 billion people. According to a Los Angeles Times analysis of the report, the wealthiest 1% owns 46% of the world's wealth.
In January 2015, Oxfam reported that the wealthiest 1 percent will own more than half of the global wealth by 2016. An October 2014 study by Credit Suisse claims that the top 1% now own nearly half of the world's wealth and that the accelerating disparity could trigger a recession. In October 2015, Credit Suisse published a study which shows global inequality continues to increase, that half of the world's wealth is now in the hands of those in the top percentile, whose assets each exceed $759,900. A 2016 report by Oxfam claims that the 62 wealthiest individuals own as much wealth as the poorer half of the global population combined. Oxfam's claims have however been questioned on the basis of the methodology used: by using net wealth, the Oxfam report, for instance, finds that there are more poor people in the United States and Western Europe than in China. Anthony Shorrocks, the lead author of the Credit Suisse report, one of the sources of Oxfam's data, considers the criticism about debt to be a "silly argument" and "a non-issue … a diversion."
Oxfam's 2017 report says the top eight billionaires have as much wealth as the bottom half of the global population, that rising inequality is suppressing wages, as businesses are focused on delivering higher returns to wealthy owners and executives. In 2018, the Oxfam report said that the wealth gap continued to widen in 2017, with 82% of global wealth generated going to the wealthiest 1%; the 2019 Oxfam report said that the poorest half of the human population has been losing wealth at the same time that a billionaire is minted every two days. According to PolitiFact, the top 400 richest Americans "have more wealth than half of all Americans combined." According to The New York Times on July 22, 2014, the "richest 1 percent in the United States now own more wealth than the bottom 90 percent". Inherited wealth may help explain why many Americans who have become rich may have had a "substantial head start". In September 2012, according to the Institute for Policy Studies (I
The proletariat is the class of wage-earners in an economic society whose only possession of significant material value is their labour-power. A member of such a class is a proletarian. In Marxist theory, a dictatorship of the proletariat is for the proletariat, of the proletariat, by the proletariat. On the Marxist view, this will endow the proletarian with the power to abolish the conditions that make a person a proletarian and, build communism; the proletarii constituted a social class of Roman citizens owning no property. The origin of the name is linked with the census, which Roman authorities conducted every five years to produce a register of citizens and their property from which their military duties and voting privileges could be determined. For citizens with property valued 11,000 assēs or less, below the lowest census for military service, their children—proles —were listed instead of their property; the only contribution of a proletarius to the Roman society was seen in his ability to raise children, the future Roman citizens who can colonize new territories conquered by the Roman Republic and by the Roman Empire.
The citizens who had no property of significance were called capite censi because they were "persons registered not as to their property...but as to their existence as living individuals as heads of a family." Although included in one of the five support centuriae of the Comitia Centuriata, proletarii were deprived of their voting rights due to their low social status caused by their lack of "even the minimum property required for the lowest class" and a class-based hierarchy of the Comitia Centuriata. The late Roman historians, such as Livy, not without some uncertainty, understood the Comitia Centuriata to be one of three forms of popular assembly of early Rome composed of centuriae, the voting units whose members represented a class of citizens according to the value of their property; this assembly, which met on the Campus Martius to discuss public policy issues, was used as a means of designating military duties demanded of Roman citizens. One of reconstructions of the Comitia Centuriata features 18 centuriae of cavalry, 170 centuriae of infantry divided into five classes by wealth, plus 5 centuriae of support personnel called adsidui.
The top infantry class assembled with full arms and armor. In voting, the cavalry and top infantry class were enough to decide an issue. In the last centuries of the Roman Republic, the Comitia Centuriata became impotent as a political body, which further eroded minuscule political power the proletarii might have had in the Roman society. Following a series of wars the Roman Republic engaged since the closing of the Second Punic War, such as the Jugurthine War and conflicts in Macedonia and Asia, the significant reduction in the number of Roman family farmers had resulted in the shortage of people whose property qualified them to perform the citizenry's military duty to Rome; as a result of the Marian reforms initiated in 107 BC by the Roman general Gaius Marius, the proletarii became the backbone of the Roman army. In the era of early 19th century, many Western European liberal scholars - who dealt with social sciences and economics - pointed out the socio-economic similarieties of the modern growing industrial worker class and the classic ancient proletarians.
One of the earliest analogies can be found in the 1807 paper of French philosopher and political scientist Hugues Felicité Robert de Lamennais. It was translated to English with the title: "Modern Slavery". Swiss liberal economist and historian Jean Charles Léonard de Sismondi, was the first who applied the proletariat term to the working class created under capitalism, whose writings were cited by Marx. Marx most encountered the Proletariat term while studying the works of Sismondi. Karl Marx, who studied Roman law at the Friedrich Wilhelm University of Berlin, used the term proletariat in his socio-political theory of Marxism to describe a working class unadulterated by private property and capable of a revolutionary action to topple capitalism in order to create classless society. In Marxist theory, the proletariat is the social class that does not have ownership of the means of production and whose only means of subsistence is to sell their labor power for a wage or salary. Proletarians are wage-workers.
For Marx, wage labor may involve getting a salary rather than a wage per se. Marxism sees the proletariat and bourgeoisie as occupying conflicting positions, since workers automatically wish their wages to be as high as possible, while owners and their proxies wish for wages to be as low as possible. In Marxist theory, the borders between the proletariat and some layers of the petite bourgeoisie, who rely but not on self-employment at an income no different from an ordinary wage or below it – and the lumpenproletariat, who are not in legal employment – are not well defined. Intermediate positions are possible, where some wage-labor for an employer combines with self-employment. Marx makes a clear distinction between proletariat as salaried workers, which he sees as a progressive class, Lumpenproletariat, "rag-proletariat", the poorest and outcasts of the society
Oppression can refer to an authoritarian regime controlling its citizens via state control of politics, the monetary system and the military. Oppression refers to a less overtly malicious pattern of subjugation, although in many ways this social oppression represents a insidious and ruthlessly effective form of manipulation and control. In this instance, the subordination and injustices do not afflict everyone—instead it targets specific groups of people for restrictions and marginalization. No universally accepted term has yet emerged to describe this variety of oppression, although some scholars will parse the multiplicity of factors into a handful of categories, e.g. social oppression. The word oppress comes from past participle of opprimere. Thus, when authoritarian governments use oppression to subjugate the people, they want their citizenry to feel that "pressing down", to live in fear that if they displease the authorities they will, in a metaphorical sense, be "squeezed" and "suffocated", e.g. thrown in a dank, state prison or summarily executed.
Such governments oppress the people using restriction, terror and despair. The tyrant's tools of oppression include, for example harsh punishments for "unpatriotic" statements. Oppression refers to a more insidious type of manipulation and control, in this instance involving the subjugation and marginalization of specific groups of people within a country or society, such as: girls and women and men, people of color, religious communities, citizens in poverty, LGBT people and children, many more; this socioeconomic, political and institutional oppression occurs in every country and society, including the most advanced democracies, such as the United States, Costa Rica and Canada. A single accepted definition of social oppression does not yet exist, although there are commonalities. Taylor defined oppression in this way: Oppression is a form of injustice that occurs when one social group is subordinated while another is privileged, oppression is maintained by a variety of different mechanisms including social norms and institutional rules.
A key feature of oppression is that it is perpetrated by and affects social groups.... Occurs when a particular social group is unjustly subordinated, where that subordination is not deliberate but instead results from a complex network of social restrictions, ranging from laws and institutions to implicit biases and stereotypes. In such cases, there may be no deliberate attempt to subordinate the relevant group, but the group is nonetheless unjustly subordinated by this network of social constraints. Harvey suggested the term "civilized oppression", which he introduced as follows: It is harder still to become aware of what I call'civilized Oppression,' that involves neither physical violence nor the use of law, yet these subtle forms are by far the most prevalent in Western industrialized societies. This work will focus on issues that are common to such subtle oppression in several different contexts... Analyzing what is involved in civilized oppression includes analyzing the kinds of mechanisms used, the power relations at work, the systems controlling perceptions and information, the kinds of harms inflicted on the victims, the reasons why this oppression is so hard to see by contributing agents.
Research and theory development on social oppression has advanced apace since the 1980s with the publication of seminal books and articles, the cross-pollination of ideas and discussion among diverse disciplines, such as: feminism, psychology and political science. Nonetheless, more understanding the problem remains an complicated challenge for scholars. Improved understanding will involve, for example, comprehending more the historical antecedents of current social oppression. Social oppression is when a single group in society takes advantage of, exercises power over, another group using dominance and subordination; this results in the supported mistreatment and exploitation of a group of individuals by those with relative power. In a social group setting, oppression may be based on many ideas, such as poverty, class, race, or other categories. Oppression by institution, or systematic oppression, is when the laws of a place create unequal treatment of a specific social identity group or groups.
Another example of social oppression is when a specific social group is denied access to education that may hinder their lives in life. Economic oppression is the divide between two classes of society; these were once determined by factors such slavery, property rights, disenfranchisement, fo
Class conflict is the political tension and economic antagonism that exists in society consequent to socio-economic competition among the social classes. As a means of effecting radical social and political changes for the social majority, class struggle is a central tenet of the philosophic works of Karl Marx and Mikhail Bakunin. Class conflict can take many different forms: direct violence, such as wars fought for resources and cheap labor. Additionally, political forms of class conflict exist; the conflict can be direct, as with a lockout aimed at destroying a labor union, or indirect, as with an informal slowdown in production protesting low wages by workers or unfair labor practices by capital. In the past the term class conflict was a term used by socialists and Marxists, who define a class by its relationship to the means of production—such as factories and machinery. From this point of view, the social control of production and labor is a contest between classes, the division of these resources involves conflict and inflicts harm.
It can involve ongoing low-level clashes, escalate into massive confrontations, in some cases, lead to the overall defeat of one of the contending classes. However, in more contemporary times this term is striking chords and finding new definition amongst capitalistic societies in the United States and other Westernized countries; the anarchist Mikhail Bakunin argued that the class struggle of the working class and poor had the potential to lead a social revolution involving the overthrow of ruling elites, the creation of libertarian socialism. This was only a potential, class struggle was, he argued, not always the only or decisive factor in society, but it was central. By contrast, Marxists argue that class conflict always plays the decisive and pivotal role in the history of class-based hierarchical systems such as capitalism and feudalism. Marxists refer to its overt manifestations as class war, a struggle whose resolution in favor of the working class is viewed by them as inevitable under plutocratic capitalism.
Where societies are divided based on status, wealth, or control of social production and distribution, class structures arise and are thus coeval with civilization itself. It is well documented since at least European Classical Antiquity and the various popular uprisings in late medieval Europe and elsewhere. One of the earliest analysis of these conflicts is Friedrich Engels' The Peasant War in Germany. One of the earliest analyses of the development of class as the development of conflicts between emergent classes is available in Peter Kropotkin's Mutual Aid. In this work, Kropotkin analyzes the disposal of goods after death in pre-class or hunter-gatherer societies, how inheritance produces early class divisions and conflict. Bill Moyers, for example, gave a speech at Brennan Center for Justice in December 2013, titled "The Great American Class War," referring to the current struggle between democracy and plutocracy in the U. S. Chris Hedges wrote a column for Truthdig called "Let's Get This Class War Started,", a play on Pink's song "Let's Get This Party Started."Historian Steve Fraser, author of The Age of Acquiescence: The Life and Death of American Resistance to Organized Wealth and Power, asserts that class conflict is an inevitability if current political and economic conditions continue, noting that “people are fed up… their voices are not being heard.
And I think that can only go on for so long without there being more and more outbreaks of what used to be called class struggle, class warfare.” The typical example of class conflict described is class conflict within capitalism. This class conflict is seen to occur between the bourgeoisie and the proletariat, takes the form of conflict over hours of work, value of wages, division of profits, cost of consumer goods, the culture at work, control over parliament or bureaucracy, economic inequality; the particular implementation of government programs which may seem purely humanitarian, such as disaster relief, can be a form of class conflict. In the USA class conflict is noted in labor/management disputes; as far back as 1933 representative Edward Hamilton of ALPA, the Airline Pilot's Association, used the term "class warfare" to describe airline management's opposition at the National Labor Board hearings in October of that year. Apart from these day-to-day forms of class conflict, during periods of crisis or revolution class conflict takes on a violent nature and involves repression, restriction of civil liberties, murderous violence such as assassinations or death squads.
Although Thomas Jefferson led the United States as president from 1801–1809 and is considered one of the founding fathers, he died with immense amounts of debt. Regarding the interaction between social classes, he wrote, I am convinced that those societies which live without government enjoy in their general mass an infinitely greater degree of happiness than those who live under the European governments. Among the former, public opinion is in the place of law, & restrains morals as powerfully as laws did anywhere. Among the latter, under pretence of governing they have divided their nations i
Racial segregation is the systemic separation of people into racial or other ethnic groups in daily life. It may apply to activities such as eating in a restaurant, drinking from a water fountain, using a public toilet, attending school, going to the movies, riding on a bus, or in the rental or purchase of a home or of hotel rooms. Segregation is defined by the European Commission against Racism and Intolerance as "the act by which a person separates other persons on the basis of one of the enumerated grounds without an objective and reasonable justification, in conformity with the proposed definition of discrimination; as a result, the voluntary act of separating oneself from other people on the basis of one of the enumerated grounds does not constitute segregation". According to the UN Forum on Minority Issues, "The creation and development of classes and schools providing education in minority languages should not be considered impermissible segregation, if the assignment to such classes and schools is of a voluntary nature".
Racial segregation is outlawed, but may exist de facto through social norms when there is no strong individual preference for it, as suggested by Thomas Schelling's models of segregation and subsequent work. Segregation may be maintained by means ranging from discrimination in hiring and in the rental and sale of housing to certain races to vigilante violence. A situation that arises when members of different races mutually prefer to associate and do business with members of their own race would be described as separation or de facto separation of the races rather than segregation. In the United States, segregation was mandated by law in some states and came with anti-miscegenation laws. Segregation, however allowed close contact in hierarchical situations, such as allowing a person of one race to work as a servant for a member of another race. Segregation can involve spatial separation of the races, mandatory use of different institutions, such as schools and hospitals by people of different races.
Wherever there have been multiracial communities, there has been racial segregation. Only areas with extensive miscegenation, or mixing, such as Hawaii and Brazil, despite some social stratification, seem to be exempt. Following its conquest of Ottoman controlled Algeria in 1830, for well over a century France maintained colonial rule in the territory, described as "quasi-apartheid"; the colonial law of 1865 allowed Arab and Berber Algerians to apply for French citizenship only if they abandoned their Muslim identity. Camille Bonora-Waisman writes that, "n contrast with the Moroccan and Tunisian protectorates", this "colonial apartheid society" was unique to Algeria; this "internal system of apartheid" met with considerable resistance from the Muslims affected by it, is cited as one of the causes of the 1954 insurrection and ensuing independence war. In fifteenth-century north-east Germany, people of Wendish, i.e. Slavic, origin were not allowed to join some guilds. According to Wilhelm Raabe, "down into the eighteenth century no German guild accepted a Wend."German praise for America's institutional racism found in Hitler's Mein Kampf, was continuous throughout the early 1930s, radical Nazi lawyers were advocates of the use of American models.
Race based U. S. citizenship laws and anti-miscegenation laws directly inspired the two principal Nuremberg Laws—the Citizenship Law and the Blood Law. The ban on interracial marriage prohibited sexual relations and marriages between people classified as "Aryan" and "non-Aryan." Such relationships were called Rassenschande. At first the laws were aimed at Jews but were extended to "Gypsies and their bastard offspring". Aryans found guilty could face incarceration in a concentration camp, while non-Aryans could face the death penalty. To preserve the so-called purity of the German blood, after the war began, the Nazis extended the race defilement law to include all foreigners. Under the General Government of occupied Poland in 1940, the Nazis divided the population into different groups, each with different rights, food rations, allowed housing strips in the cities, public transportation, etc. In an effort to split Polish identity they attempted to establish ethnic divisions of Kashubians and Gorals, based on these groups' alleged "Germanic component."
During the 1930s and 1940s, Jews in Nazi-controlled states were made to wear yellow ribbons or stars of David, were, along with Romas, discriminated against by the racial laws. Jewish doctors were not allowed to treat Aryan patients nor were Jewish professors permitted to teach Aryan pupils. In addition, Jews were not allowed to use any public transportation, besides the ferry, were able to shop only from 3–5 pm in Jewish stores. After Kristallnacht, the Jews were fined 1,000,000 marks for damages done by the Nazi troops and SS members. Jews and Roma were subjected to genocide as "undesirable" racial groups in the Holocaust; the Nazis established ghettos to confine Jews and sometimes Romas into packed areas of the cities of Eastern Europe, turning them into de facto concentration camps. The Warsaw Ghetto was the largest of these ghettos, with 400,000 people; the Łódź Ghetto was the second largest, holding about 160,000. Between 1939 and 1945, at least 1.5 million Polish citizens were transported to the Reich for forced labour.
Although Nazi Germany used forced laborers from We
Wealth inequality in the United States
Wealth inequality in the United States is the unequal distribution of assets among residents of the United States. Wealth includes the values of homes, personal valuables, businesses and investments; the net worth of U. S. households and non-profit organizations was $94.7 trillion in the first quarter of 2017, a record level both in nominal terms and purchasing power parity. If divided among 124 million U. S. households, this would be $760,000 per family. From an international perspective, the difference in US median and mean wealth per adult is over 600%. Just prior to President Obama's 2014 State of the Union Address, media reported that the top wealthiest 1% possess 40% of the nation's wealth; the gap between the top 10% and the middle class is over 1,000%. The average employee "needs to work more than a month to earn what the CEO earns in one hour." Although different from income inequality, the two are related. In Inequality for All—a 2013 documentary with Robert Reich in which he argued that income inequality is the defining issue for the United States—Reich states that 95% of economic gains went to the top 1% net worth since 2009 when the recovery started.
More in 2017, an Oxfam study found that eight rich people, six of them Americans, own as much combined wealth as half the human race. A 2011 study found that US citizens across the political spectrum underestimate the current US wealth inequality and would prefer a far more egalitarian distribution of wealth. Wealth is not used for daily expenditures or factored into household budgets, but combined with income it comprises the family's total opportunity to secure a desired stature and standard of living, or pass their class status along to one's children. Moreover, wealth provides for both short- and long-term financial security, bestows social prestige, contributes to political power, can be used to produce more wealth. Hence, wealth possesses a psychological element that awards people the feeling of agency, or the ability to act; the accumulation of wealth grants more options and eliminates restrictions about how one can live life. Dennis Gilbert asserts that the standard of living of the working and middle classes is dependent upon income and wages, while the rich tend to rely on wealth, distinguishing them from the vast majority of Americans.
A September 2014 study by Harvard Business School declared that the growing disparity between the wealthy and the lower and middle classes is no longer sustainable. In 2007, the top 20% wealthiest possessed 80% of all financial assets. In 2007 the richest 1% of the American population owned 35% of the country's total wealth, the next 19% owned 51%. Thus, the top 20% of Americans owned 86% of the country's wealth and the bottom 80% of the population owned 14%. In 2011, financial inequality was greater than inequality in total wealth, with the top 1% of the population owning 43%, the next 19% of Americans owning 50%, the bottom 80% owning 7%. However, after the Great Recession which started in 2007, the share of total wealth owned by the top 1% of the population grew from 35% to 37%, that owned by the top 20% of Americans grew from 86% to 88%; the Great Recession caused a drop of 36% in median household wealth, but a drop of only 11% for the top 1%, further widening the gap between the top 1% and the bottom 99%.
According to PolitiFact and others, in 2011 the 400 wealthiest Americans have more wealth than half of all Americans combined. Inherited wealth may help explain why many Americans who have become rich may have had a substantial head start. In September 2012, according to the Institute for Policy Studies, over 60 percent of the Forbes richest 400 Americans grew up in substantial privilege. In 2013 wealth inequality in the U. S. was greater than in most developed countries other than Denmark. In the United States, the use of offshore holdings is exceptionally small compared to Europe, where much of the wealth of the top percentiles is kept in offshore holdings. While the statistical problem is European wide, in Southern Europe statistics become more unreliable. Fewer than a thousand people in Italy have declared incomes of more than 1 million euros. Former Prime Minister of Italy described tax evasion as a "national pastime". According to a 2014 Credit Suisse study, the ratio of wealth to household income is the highest it has been since the Great Depression.
However, according to the Federal Reserve, "For most households and Social Security are the most important sources of income during retirement, the promised benefit stream constitutes a sizable fraction of household wealth" and "including pensions and Social Security in net worth makes the distribution more even". A September 2017 study by the Federal Reserve reported that the top 1% owned 38.5% of the country's wealth in 2016. According to a June 2017 report by the Boston Consulting Group, around 70% of the nation's wealth will be in the hands of millionaires and billionaires by 2021. Pioneering work by Simon Kuznets using income tax records and his own well-researched estimates of national income showed a reduction of about 10% in the portion of national income going to the top 10%, a reduction from about 45–50% in 1913 to about 30–35% in 1948; this period spans both The Great Depression and World War II, events with significant economic consequences. This is called the Great Compression.
There is an important distinction between income and