Poor seen getting poorer Gap between rich, poor called biggest in nearly 40 years.

October 30, 1991|By Los Angeles Times

WASHINGTON LHC RXB — WASHINGTON -- Janet L. Norwood, veteran U.S. commissioner of the Bureau of Labor Statistics, decries Washington's lack of leadership on economic problems, saying the country is being polarized by the growth of the most severe gap between the poorest and richest Americans she has seen in 38 years of government service.

"There's a lot of posturing going on," she says, but neither Republicans nor Democrats have come up with an answer to economic problems that plague the country and leave the poorest Americans worse off than ever.

Although the Department of Commerce reported yesterday that the economy technically pulled itself out of the recession in the third quarter by growing 2.4 percent, Norwood said she sees no sign that the nation is creating the new jobs necessary for true economic recovery.

Declaring that the nation must be mobilized to solve the problem, she said, "We need leadership, but I don't think it can come just from government. It clearly isn't coming right now from the Congress or the president."

Norwood, who has served almost 12 years as the politically independent head of the Bureau of Labor Statistics, was first appointed to a four-year term by President Carter and was reappointed twice by President Reagan. She recently informed President Bush that she did not want to be reappointed and would retire at the end of the year to join the Urban Institute, a Washington think tank, as a senior fellow.

In a breakfast interview, she cited the growing gap between the rich and poor and said, "I am very worried, extraordinarily concerned, about the polarization that I see going on in our country."

It used to be that most everyone on the income scale moved up, she said, so that people on the bottom saw their situation improving. Now, she said, the bottom group is "splitting": Some are moving into the middle class, but those left behind are "sinking further." "You can't have a democratic system if you increasingly have haves and have-nots," she said.

A study released three months ago by the non-profit Center on Budget and Policy Priorities, a liberal think tank, showed that the income gap between rich and poor widened dramatically during the 1980s. Average incomes increased 122 percent after taxes for the top 1 percent of households, but fell 10 percent for the bottom fifth. Income for the top 1 percent, measured in 1991 dollars, rose from an average of $203,000 per household in 1977 to $451,000 in 1988.

The Census Bureau's 1990 report on income showed that the top 20 percent of Americans received 46.8 percent of all the household income while the bottom 20 percent received 3.9 percent of all household income.

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