Nobel Prize Economist: Income Inequality Has Made American Dream A ‘Myth’

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Nobel Prize-winning economist Joseph Stiglitz says that income inequality has made the American Dream a "myth." (Photo by Stephen Lovekin/Getty Images for Time Warner)

Nobel Prize-winning economist Joseph Stiglitz says that income inequality has made the American Dream a “myth.” (Photo by Stephen Lovekin/Getty Images for Time Warner)

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WASHINGTON (CBS WASHINGTON) – Nobel Prize-winning economist Joseph Stiglitz believes that the American Dream has become a “myth.”

In an interview with Germany’s Der Spiegel, the American-born, Columbia University economist says the finance industry is to blame for the ever-growing divide between the rich and the poor in the United States.

“The belief in the Dream is still powerful,” Stiglitz told Spiegel. “But there has been no improvement in well-being for the typical American family for 20 years. On the other side, the top one percent of the population gets 40 percent more in one week than the bottom fifth receive in a full year. In short, we have become a divided society.”

Stiglitz went on to say that in the last few decades, income and wealth disparity have grown astronomically. He provides the example that in 2011 the six heirs to the Wal-Mart empire commanded wealth of almost $70 billion, which is equivalent to the wealth of the entire bottom 30 percent of U.S. society.

The economist stated that politicians on both sides share blame for the deception that has led to the increase in inequality. He was asked about whether or not he thought Occupy Wall Street’s “99 percent” slogan was accurate, and who exactly represents the other “1 percent.”

“It is the group of people who get 20 to 25 percent of the income. Their share has doubled in the last 30 years. And they own about 35 percent of the wealth or more. They have the best houses, the best education and the best lifestyles,” said Stiglitz.

When prodded about how former Republican President George W. Bush said that the U.S. did not have enough money for health insurance, yet the U.S. bailed out AIG for $150 billion, Stiglitz was succinct in his reply.

“Ninety-nine percent against 1 percent: That actually sounds like the perfect setting for a revolution. Why are things still so calm in the U.S.?”

Joseph Stiglitz is a current professor at Columbia University in New York City, and he won the Nobel Prize in 2001.

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