S&P: Widening economic disparity harmful to recovery

Economic disparities are reaching extremes and becoming harmful to economic growth, according to a chief U.S. economist with rating agency Standard & Poor’s.

The widening gap between the richest Americans and the rest of the country has made the economy more susceptible to boom-bust cycles and diminished the 5-year-old recovery from the recession, according to the analysis.

The deepening economic disparity in the U.S. has, in part, prompted the S&P to cut its growth estimates to 2.5 percent in the next decade from a forecast of 2.8 percent five years ago, according to the Associated Press.

Since 1913, the average income for the top 0.01 percent of wage earners has increased by a factor of seven. For the bottom 90 percent of Americans, average incomes after inflation have grown by a factor of just three since 1917 and have declined for the past 13 years.

Read more from the Associated Press.