Center on Budget and Policy Priorities

The Issue of Income Inequality

With income inequality now a central issue of debate in Washington and around the country, below is CBPP’s recent blog slideshow series exploring trends in income inequality in recent decades and different data sources used to examine the issue.

The broad facts of income inequality over the past six decades are easy to summarize: The years from the end of World War II into the 1970s saw substantial economic growth and broadly shared prosperity. Beginning in the 1970s, economic growth slowed and the income gap widened. Wealth is much more highly concentrated than income, although the wealth data do not show a dramatic increase in concentration at the very top the way the income data do.

Facing Our Fiscal Challenges

Romney Budget Proposals Would Require Massive Cuts in Nondefense Programs

“Presidential candidate Mitt Romney’s proposals to cap total spending, boost defense spending, cut taxes, and balance the budget would require extraordinarily large cuts in nondefense programs. If policymakers cut all nondefense programs by the same percentage, the cuts would measure 21 percent in 2016 and 36 percent in 2021. If policymakers exempted Social Security from the cuts and then cut all other nondefense programs by the same percentage, the cuts would rise to 30 percent in 2016 and 54 percent in 2021.” Read more

Related:

Romney’s Charge That Most Federal Low-Income Spending Goes For “Overhead” and “Bureaucrats” Is False:
For Major Low-Income Programs, More Than 90 Percent Goes to Beneficiaries

Proposed Budget Process Changes Would Mark Step Backward

House committees this week are considering a series of changes to the congressional budget process that proponents say will promote fiscal responsibility. CBPP has produced analyses of four of the bills thus far, explaining why they would mark a step backward for the budget process:

More: Federal Budget Analyses

The Earned Income Tax Credit

The 6th Annual EITC Awareness Day

EITC Outreach Kit

The Earned Income Tax Credit (EITC) Awareness Day is an event organized annually by the Internal Revenue Service (IRS) and its partners each January to educate the public about the federal EITC and requirements to claim the credit. The goal is to raise awareness of EITC to ensure every qualified worker claims and receives their EITC.

The boost provided by the EITC and other valuable federal tax credits provide many working families the opportunity to pay their household bills and meet their children’s needs even through salary cutbacks or periods of unemployment. Yet according to the IRS, each year millions of eligible workers do not claim their credits, missing out on millions of dollars they earned.

In 2010, the EITC lifted about 6 million people out of poverty, including about 3 million children. The poverty rate among children would have been nearly one-third higher without the EITC. The EITC lifts more children out of poverty than any other program.

More about the EITC: