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U.S. Income Inequality Worse Now Than In 1774: Study

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Believe it or not, income inequality in the United States is worse today than it was back in 1774.

That’s what a recent report from the National Bureau of Economic Research has found. In “American Incomes 1774 to 1860,” authors Peter H. Lindert and Jeffrey G. Williamson argue that the American colonies were exceptionally egalitarian, compared to both other nations at the time and the U.S. today. And their data even factors in slavery.

As the Atlantic’s Jordan Weissman points out, such studies should be taken with a grain of salt, given that making historical economic analyses is like “making a messy collage, collecting the disparate bits and pieces of information we have available and fashioning them into a coherent picture,” Weissman writes.

But NBER's is not the first study to contend that income inequality today is worse than before. A 2009 study looking at data stretching back to 1917 found that American income inequality was at an all-time high. Likewise, two historians concluded last year that income inequality today is worse even than it was during the Roman Empire. The study found that the top 1 percent of Ancient Roman earners controlled 16 percent of the Empire’s riches, compared to the top 1 percent of American earners today who control 40 percent of the country's wealth.

Indeed, signs of America’s yawning income gap aren’t exactly rare. On Wednesday, just days after the first anniversary of Occupy Wall Street, a movement in part dedicated to exposing the nation's income inequality, Forbes released its list of the 400 richest Americans. Combined, their net worth is $1.7 trillion, or the combined yearly household income of more than 64 million Americans.

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