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The 1% Problem: A Glimpse Into America’s Wealth Inequality

Ultimately, addressing the 1% problem will require a fundamental shift in societal values and economic priorities. It will necessitate a willingness to challenge the status quo and rethink the role of wealth and power in American society.

Tax policy has also played a significant role in exacerbating wealth inequality. The Tax Cuts and Jobs Act of 2017, for example, significantly reduced taxes on corporations and high-income earners, while eliminating key provisions that helped support low-income households.

Addressing the 1% problem will require a multifaceted approach, involving policy changes, economic reforms, and social transformations. Some potential solutions include:

At the heart of this issue lies a complex interplay of historical, economic, and cultural factors. The seeds of this problem were sown in the late 20th century, when the US experienced a period of unprecedented economic growth, driven largely by globalization and technological advancements.

Wealth inequality has far-reaching consequences for American society, affecting not only economic mobility but also social cohesion and trust in institutions. Some of the key impacts include:

Wealth inequality is a multifaceted problem that defies easy explanation. However, at its core, it involves the concentration of wealth among a small percentage of the population, while the majority struggles to make ends meet.

What Can Be Done to Address the 1% Problem?

As the United States continues to grapple with the aftermath of the 2008 financial crisis, a stark reality has emerged: the widening chasm between the country’s ultra-wealthy elite and the rest of the population. America’s wealth inequality, often referred to as the “1% problem,” has become a pressing concern for policymakers, economists, and ordinary citizens alike.

Making up the top 1% of earners in the US are individuals and households with incomes above $750,000 per year, according to data from the Internal Revenue Service. This group includes:

This phenomenon can be attributed to several factors, including the decline of labor unions, the erosion of the minimum wage, and the increasing concentration of wealth among corporate executives and owners.

This shift in tax policy has contributed to a widening gap between the top 1% and the rest of the population. According to a report by the Institute on Taxation and Economic Policy, the top 1% of earners saw their after-tax income increase by 14.2% between 2017 and 2020, while the bottom 50% experienced a decline of 1.1%.

Data updated: April 2026.