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I.R.S. Says Americans' Income Shrank for 2 Consecutive Years

QUOTE
he overall income Americans reported to the government shrank for two consecutive years after the Internet stock market bubble burst in 2000, the first time that has effectively happened since the modern tax system was introduced during World War II, newly disclosed information from the Internal Revenue Service shows.

The total adjusted gross income on tax returns fell 5.1 percent, to just over $6 trillion in 2002, the most recent year for which data is available, from $6.35 trillion in 2000. Because of population growth, average incomes declined even more, by 5.7 percent.

Adjusted for inflation, the income of all Americans fell 9.2 percent from 2000 to 2002, according to the new I.R.S. data.

While the recession that hit the economy in 2001 in the wake of the market plunge was considered relatively mild, the new information shows that its effect on Americans' incomes, particularly those at the upper end of the spectrum, was much more severe. Earlier government economic statistics provided general evidence that incomes suffered in the first years of the decade, but the full impact of the blow and what groups it fell hardest on were not known until the I.R.S. made available on its Web site the detailed information from tax returns.

The unprecedented back-to-back declines in reported incomes was caused primarily by the combination of the big fall in the stock market and the erosion of jobs and wages in well-paying industries in the early years of the decade.
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southsider2k5
The stock market bubble is the lions share of that number. And it makes total sense. When you factor that 80% of wealth is controlled by 20% of the nation, and then factor in the fact that lower 1/5 of incomes basically has no stock, it makes total sense that the huge evaporations of equity would have a huge numerical affect on the economy. Honestly I am surprised it wasn't bigger.
Wedge
QUOTE(southsider2k4 @ Jul 29 2004, 09:10 AM)
The stock market bubble is the lions share of that number.  And it makes total sense.  When you factor that 80% of wealth is controlled by 20% of the nation, and then factor in the fact that lower 1/5 of incomes basically has no stock, it makes total sense that the huge evaporations of equity would have a huge numerical affect on the economy.  Honestly I am surprised it wasn't bigger.

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