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Wall Street versus Washington

By Judy Martel · Bankrate.com
Tuesday, October 11, 2011
Posted: 4 pm ET

Fed up with a widening gap between the haves and have-nots, protestors have taken their grievances public in the form of growing street protests.

Wall Street protesters. Photo courtesy of Brian McFadden.

Known as the Occupy Wall Street Movement, groups have been forming mostly in the Manhattan area to complain that they don't wield the same political influence over Washington politics as the richest 1 percent of Americans. "We are the 99 percent," they chanted in a recent march.

The protesters believe the financial industry has profited off the backs of the middle class, and the government is not doing enough to intervene to save their homes and jobs.

However far this particular movement spreads, it's not surprising that unrest has developed out of the current economic situation. The Great Recession, precipitated by the housing crash, wiped out much of the previous decades' financial gains of the middle classes, which mostly measure net worth by the value of their homes. Corporate layoffs as a result of the recession only made the situation more tenuous for those struggling to make ends meet.

And the protesters are right in that the gap between rich and poor seems to be growing. As reported in the Wall Street Journal, an economist at New York University, Edward Wolff, analyzed wealth in the U.S. and found that the richest 1 percent not only maintained wealth during the recession, but may have even gained some. Because the wealthy hold more of their investments in the stock market, they recovered faster than the rest of the population. In 2007, they held 34.6 percent of all national wealth, according to Wolff. By the end of 2009, they held 35.6 percent. During that same period, the share of national wealth held by the bottom 90 percent fell from 27 percent to 25 percent.

Do you think Wall Street is responsible for the growing gap between rich and poor and that Washington is not doing enough to solve the economic crisis?

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1 Comment
Ash
October 12, 2011 at 6:42 pm

Wall Street is not responsible, the government is. The administrations's and the Fed's monetary policies are destroying the dollar and the wealth of this nation. Stop printing money, and stop giving it away to the banks.