.
This graph also shows that in 1997, the top fifth's income was ten times that of the poverty line, while the bottom fifths was slightly less then one. This means that, while the rich were enjoying a substantial income, the average incomes of the poor were not even high enough to sustain an average family of four. The poverty line is the absolute minimum that the government deems necessary for adequate nutrition for a family of four yet the poor are not even making this much money.
This loss in income is due to a number of reasons. They range from an increase in a skilled labor force to corporate takeovers whose end result is the termination of thousands of jobs. In either case, the lower class unskilled laborer suffers at the hands of businessmen who are out looking for profits. This is evident in both the "Economic Report of the President" as well as the video "Running with the Bulls.".
"The Economic Report of the President," specifically page 173 contains graphs, which demonstrate the increase in inequality due to shifts in either the supply or demand of skilled and unskilled laborers. In the supply graphs, there were increases in the supply for both unskilled as well as skilled workers. This pushed the wages down for both groups, but increased employment.
The demand curve, however, showed a slightly different story. For the unskilled workers, there was a decrease in demand, which sent the wages plummeting further. But, for the skilled workers, the demand increased, which pushed wages up. This increase in wages for skilled workers demonstrates that the rich are getting richer because most skilled labor requires a college degree. That degree costs money, so only those that can afford the education can improve their skills and in turn reap of the rewards and opportunities now opened to them.
The demand curves also leads us to believe that the best performers are rewarded by large increases in wages for only a slight increase in performance.
