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News Link • Economy - Economics USA

Underneath the Happy Talk, Is This As Bad as the Great Depression?

• NakedCapitalism.com/ & Washingtonblog.com
 
Food Stamps Replace Soup Kitchens 1 out of every 7 Americans now rely on food stamps. While we don’t see soup kitchens, it may only be because so many Americans are receiving food stamps. Indeed, despite the dramatic photographs we’ve all seen of the 1930s, the 43 million Americans relying on food stamps to get by may actually be much greater than the number who relied on soup kitchens during the Great Depression. Inequality Worse than During the Great Depression I recently reported that inequality is worse than it’s been since 1917: Most mainstream economists do not believe there is a causal connection between inequality and severe downturns.But recent studies by Emmanuel Saez and Thomas Piketty are waking up more and more economists to the possibility that there may be a connection. Specifically, economics professors Saez (UC Berkeley) and Piketty (Paris School of Economics) show that the percentage of wealth held by the richest 1% of Americans peaked in 1928 and 2007 – right before each crash:

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