Congress can reverse America’s Wealth Disparity. But we must determine whether the public cares and, if so, whether they are aware that it affects their living conditions.
Do we have extreme disparity in wealth? Does anyone notice or care?
Everyone expects there to be differences in wealth and income among Americans, as is true of citizens of other developed countries. Many of us do not expect to be among the richest. Even so, what happens when wealth accumulates to the point that the richest 1% of Americans hold nearly one-third of the nation’s total net worth? That is what we have in 2025.
Sarah Anderson, who directs the Global Economy Project and co-edits Inequality.org at the Institute for Policy Studies, wrote, “Something has gone wrong here in the U.S. We now have a wider wealth gap between rich and poor than in any other major developed nation.”
However, when measured across all households, U.S. income inequality is comparable to that of other developed countries before taxes and transfers. Nevertheless, after taxes are paid and benefits are provided to lower-income families and business owners, such as tax write-offs, the U.S. becomes one of the highest in income inequality. In other words, the rich receive far more benefits than the poor on welfare; essentially, higher-income households in other developed countries transfer more wealth to their lower-income households.
Analysts and consumers have noticed that since President Ronald Reagan’s two administrations, income and wealth disparity has been growing. It may not be coincidental, since his kitchen cabinet consisted of 16 millionaires who recommended appointees to his cabinet. That was a time when millionaires had the financial and political clout that billionaires have today.
An Economist/YouGov poll from January 2026 found that half of Americans (52%) say the gap between rich and poor is a very big problem. The conservative American Enterprise Institute reviewed Gallup polling from Reagan’s last term onward and found that 60% have consistently agreed that money and wealth should be more evenly distributed.
If there is an extreme disparity in wealth, how does it impact our lives?
The gap between the richest and average citizens is the same as it was right before the Great Depression began a hundred years ago. That calamity was tied to the stock market’s collapse. There are currently more protections in place to prevent that phenomenon from recurring, and we have a sturdier social safety net.
Nevertheless, the significant income gap between the average citizen and the wealthiest during the 1920s was due in part to rapid productivity and corporate profits growth, while employees saw their wages decline in purchasing power. Consequently, our economy increasingly depended on wage earners taking on greater debt rather than on having more income to meet their basic needs. This is the pattern we see today in America.
Overall, the bottom half of households hold nearly zero net wealth, and many carry debt that exceeds the value of their assets just to afford a decent standard of living. It’s hardest for the poor. In 2016, the bottom 20% of the population had an average income of $15,600; the top 20% earned $280,300. Income disparity also extends into the highest income bracket, with the top 1% earning $1.8 million per year and owning 32% of all US wealth.
This huge gap in income and wealth between half of our citizens and the wealthiest undermines the stability of our consumer-dependent economy. As of the second quarter of 2025, the top 10% of income earners accounted for nearly half of all U.S. consumer spending, according to Mark Zandi, chief economist at Moody’s Analytics. Since consumer spending drives about 70% of U.S. GDP, if one-tenth of households suddenly and significantly reduce their spending, the average citizen will suffer the most, as jobs disappear if a recession sets in.
In the US, the top 10% own roughly 90% of all publicly traded stocks, which make up about 45% of these households’ personal asset portfolios and are closely tied to the AI-driven stock rally. A big chunk of the “growth” in the economy, as measured and publicly cited as a sign that the economy is booming, is really a wealth effect from the portfolios of the wealthiest, not the paychecks of working Americans. If the AI stock rally stalls or dives, AI shareholders may well dump the stock and cause a ripple effect throughout the economy if there is fear of a shrinking economy.
Lower take-home pay is already underway, as evidenced by the fact that consumer spending among middle-income households (40th–60th percentile) has leveled off over the past two years, while consumer prices are up roughly 25% since 2020. As a result, most households are losing ground. While aggregate GDP and retail sales numbers can look healthy, most people experience stagnation or decline in their incomes and wealth.
What do voters want of Congress?
Constitutionally, Congress has the authority to levy and collect taxes. This is the linchpin for maintaining a stable economic system that a democracy must have to sustain its operations. And just as importantly, it helps bolster cultural acceptance of democratic governance as the preferred form of government.
Congress, being elected more often than a president, represents an ongoing regional mix of citizens’ concerns. But unlike a president, it is subject to multiple points of view in reaching a final decision. This is an internal negotiation that occurs among Congressional members.
In the Congressional debates that unfold, it is expected that popular beliefs and needs will rise to the top of Congress’s agenda for action. This has not been what has been happening with regard to the widespread concern about the concentration of wealth in fewer hands.
In the past 40 years, poll after poll shows that the majority of Americans support taxing the rich. As recently as January 2026, 59% said the federal government should reduce the wealth gap, while only 21% said it shouldn’t. Although Democrats and Republicans are deeply divided, 57% of independent voters said the government should. However, as the AEI noted, despite consistent popular support, that support becomes fragmented when specific policy mechanisms are proposed, such as wealth taxes, redistribution, and regulation.
Lost in Congressional debates is an effort to overhaul an unfair tax system that continues to widen wealth and income disparities. Over the last 35 years, Congress, under both parties, has gradually lowered marginal tax rates, resulting in the top 1 percent seeing their incomes reach new heights. Meanwhile, Congress has pushed for the importation of cheaper goods, greater automation, and restrictions on organized labor that would hinder these trends.
One can understand why public approval of Congress has averaged around 30% on Gallup during that time. Under both President Joe Biden’s term and Trump’s current term, hope for what Congress could accomplish peaked in each president’s first quarter, reaching Congressional approval of 36% under Biden and 31% under Trump. Congress’s rating plummeted under both administrations after the first quarter, reaching 12% for Biden in his last quarter and 10% this past April for Trump.
The numbers will continue to fluctuate for Trump, but the pattern is clear: the public doesn’t approve of Congress, and they expect the President to work with it to make America more affordable.
Congress has the power to close the disparity gap in wealth.
Gabriela Sandoval, the Executive Director of the Excessive Wealth Disorder Institute (EWDI), provides a report on six taxes that Congress could enact to stem the steady shift of wealth from the top 10% of citizens and redirect it to the other 90%. Taxes are the most direct approach, though not all are equally effective or popular.
Among the six explored (the billionaire tax, wealth tax, raising the top marginal tax rate, millionaire surtax, capital gains taxes, and the estate tax and related dynasty trust reform), the billionaire tax is the easiest to explain and the most acceptable to the public. Consequently, it will be reviewed here, since discussions of the others require more detailed descriptions. An Inequality.org meta-analysis of more than 55 polls found that a billionaire income tax averaged 67% support, including 84% of Democrats, 64% of independents, and 51% of Republicans — the highest cross-partisan support among any wealth-tax variant they tracked.
President Joe Biden’s Billionaire Minimum Income Tax proposal (BMIT) is the model that was introduced into Congress. It would have required those who own at least $100 million (approximately the richest 0.01% or about 20,000 households) to pay an effective tax rate of at least 20%. In comparison, the median US wage worker pays an effective total federal tax rate of approximately 16% on their gross income. However, billionaires earn income from investments, not from hours in the office or shop as wage workers do; in addition, they have more spendable income to cover not only their basic needs but also any other needs they desire.
With such broad support, why did the BMIT legislation never receive a vote in Congress? Biden and Congressional Democrats either lacked a strategy to pass it or didn’t make a serious effort. Although Democrats controlled both the Senate and the House for the first two years of Biden’s administration, the BMIT was not introduced until the last two years, when they no longer controlled the House.
It’s typical for the President’s party to do poorly in the midterm elections. Democrats were proud to have kept the Republicans to a slim majority. Still, they lost control of the House, leaving no chance of passing any BMIT legislation with the Republicans in control. The Democrats should have pushed for BMIT while they had a majority in both houses. Instead, they pushed for the Inflation Reduction Act (IRA), which, although it had received between 55% and 70% public support, not a single Republican voted for it. The IRA did pass, and BMIT could have as well by the same count.
Any progressive tax legislation, such as the BMIT or the other five tax options, will not pass Congress as long as Republicans control one of the chambers. Despite half of Republican voters supporting generic progressive tax legislation, taxing billionaires will not pass for two reasons.
First, Republican legislators receive roughly 80% of billionaires’ political spending, which supports GOP candidates in the midterm elections, according to an analysis of Federal Election Commission filings cited by Fortune. Second, the Democrats need to connect the dots between billionaires and the public policies they promote, which make life harder for more than half of Americans.
For Democrats, this is not about pushing socialism as a solution; it’s about pushing for a democratic government that is not another commodity to be purchased. It’s about doing grassroots organizing in rural, as well as urban, communities that are being hurt by policies that benefit only the few, but not them or their neighbors.
Voters must deliver a message to Congress that they are obligated to protect all citizens’ interests above those of the wealthiest.
