- Associated Press - Wednesday, October 26, 2011

WASHINGTON (AP) — The richest 1 percent of Americans have been getting far richer over the past three decades while the middle class and poor have seen their after-tax household income only crawl up in comparison, according to a government study.

After-tax income for the top 1 percent of U.S. households almost tripled, up 275 percent, from 1979 to 2007, the Congressional Budget Office found. For people in the middle of the economic scale, after-tax income grew by just 40 percent. Those at the bottom experienced an 18 percent increase.

“The distribution of after-tax income in the United States was substantially more unequal in 2007 than in 1979,” CBO Director Douglas W. Elmendorf said in a blog post. “The share of income accruing to higher-income households increased, whereas the share accruing to other households declined.”

The report, based on Internal Revenue Service and Census Bureau data, comes as the “Occupy Wall Street” movement protests corporate bailouts and the gap between the haves and have-nots. Demonstrators call themselves “the 99 percent.”

The report also found:

• The top 20 percent of the population earned 53 percent of after-tax income in 2007, as opposed to 43 percent in 1979.

• The top 1 percent reaped a 17 percent share of all income, up from 8 percent in 1979.

• The bottom 20 percent reaped just 5 percent of after-tax income, compared with 7 percent in 1979.

Lawmakers and presidential candidates are mulling an overhaul of the tax code — some propose a flat tax that critics say could magnify the income gap — and a congressional “supercommittee” is weighing options to cut the deficit.

President Obama has toured the country promising to raise taxes on the wealthy in order to finance his jobs agenda, which includes continuing a payroll tax cut; boosting infrastructure spending; and helping local governments avoid layoffs of teachers, police officers and firefighters.

In a speech Wednesday, Rep. Paul Ryan, Wisconsin Republican, who is chairman of the House Budget Committee, decried Mr. Obama’s moves as “class warfare” and said GOP policies would preserve “equality of opportunity.”

“Telling people they are stuck in their current station in life, that they are victims of circumstances beyond their control, and that the government’s role is to help them cope with it — well, that’s not who we are,” Mr. Ryan said at the conservative Heritage Foundation.