As the
New York Times notes, this is
all you need to know about income inequality, in one comparison:
The Wall Street bonus pool for last year is roughly double the total earnings of all Americans who work full time at the federal minimum wage.
The numbers are based on a report from Sarah Anderson at the Global Economy Project at the Institute for Policy Studies. Among the
key findings:
The $28.5 billion in bonuses doled out to Wall Street employees is double the annual pay for all 1,007,000 Americans who work full-time at the current federal minimum wage of $7.25 per hour. Wall Street bonuses rose 3 percent last year, despite a 4.5 percent decline in industry profits.
Let that sink in for a minute. They had $28.5 billion in bonuses, even though their profits declined. The report also notes, these types of massive bonuses encourage bad behavior:
Wall Street’s bonus culture, we learned from the 2008 financial industry meltdown, creates an incentive for high-risk behaviors that endanger the entire economy. A large share of low-wage earners, on the other hand, spend every workday meeting basic human needs, such as providing food services and taking care of the disabled and elderly.
And what would a bonus pool like that do for average American workers? It would help lift them out of poverty:
The bonus pool is so large it would be far more than enough to lift all 2.9 million restaurant servers and bartenders, all 1.5 million home health and personal care aides, or all 2.2 million fast food preparation and serving workers up to $15 per hour.
And because people who make minimum wage spend every dollar they earn, it would have a positive effect on the economy as a whole. Turns out trickling up is better for the economy than trickling down:
These pennies add up considerably on $28.5 billion in earnings. If the $28.5 billion Wall Streeters pulled in on bonuses in 2014 had gone to minimum wage workers instead, our GDP would have grown by about $34.5 billion, over triple the $11.1 billion boost expected from the Wall Street bonuses.