In the last few decades, the difference between the US and China in terms of poverty alleviation and economic equity could hardly be starker. China has already done this with their recent eradication of extreme poverty. At the same time, the United States suffers from a growing chasm between its richest citizens and everyone else who are just getting by. In short, in 1990, a nearly incomprehensible 943 million Americans experienced high poverty. That’s living on less than $3 a day in 2021 dollars for each individual, which amounted to 83% of the population. Today that number is over 4 million, or 1.25% of the total U.S. population. That amount is over three times the level 35 years ago!
China’s economic miracle speaks for itself, from their GDP growth to taking hundreds of millions of their people out of poverty. By 2019, the country could boast of having no one at all in poverty, an extraordinary achievement by any measure. The United States’ economic output per person is roughly six times the level of China’s per capita GDP. The share of wealth that the bottom Americans hold continues to decrease. The bottom 10% of income earners in the U.S. now take home less than 2 percent of the U.S. total income. Unfortunately, this percentage is not so shockingly different from what poor communities in developing countries such as Bolivia are used to.
Diving into historical data tells a different story that uncovers the reality of worsening income inequality across the American landscape. In 1980, the slice of middle-income Americans made a little over half (52.5%) of what their peers at the very top 90th percentile made. By the beginning of this century, that ratio had narrowed down to 48%. This continued pattern did not change regardless of administration. Just under Bill Clinton and the first term of Donald Trump did we experience short-lived declines, largely due to pandemic-era transfers that lifted the bottom half of earners’ incomes.
The rate of income growth for the top 1% of Americans has far exceeded that of the bottom 99%. Between 2000 and 2023, individuals in the top 90th percentile saw their earnings increase more than twice as fast as those in the bottom 10th percentile. This growing disparity sheds light on the daily barriers that low-income Americans experience. Yet, they are getting more and more squeezed out in an economy hell bent on maximizing productivity and wealth accumulation.
American productivity has outstripped that of its European peers. Worse, the nation has once again turned a blind eye to its poorest people—a familiar and troubling pattern. Aid for people who live around the poverty line has been dwindling for decades. This trend reflects decades of policy decisions that have favored the concentration of wealth over its equitable distribution. The current administration’s approach to addressing these disparities remains unclear, and there is little indication that significant change is forthcoming.
In addition, going forward, projections show that the bottom decile could face as much as a 7% reduction in income if the status quo persists without intervention. These results are very shocking. They point to a future where the future economic deprivation will fall disproportionately upon our least advantaged communities. Sadly, well over 4 million Americans still fail to have their basic needs met. This troubling reality begs the question of how effective and comprehensive our social safety nets are in today’s society.
This sharp contrast between the two states highlights their very different policy priorities and values as a society. While China has made substantial strides in uplifting its population, the U.S. remains entrenched in a system that marginalizes its most vulnerable citizens. The effects of these trends go far beyond the numbers—it’s indicative of a larger societal disdain for wealth, opportunity, and accountability.