How Much Money Would Americans Make If All Income Was Equally Distributed?
A large percentage of Americans favor a reduction in income inequality. In 2020, a survey by Pew Research found that 42% of Americans said that reducing income inequality should be a top priority of the federal government. During the pandemic, income inequality was once again on the rise in the United States. The top 1% of earners now hold more wealth than ever before. These numbers, combined with a recent uptick in major strikes and worker concerns, have put income inequality at the forefront once again.
But what does complete income equality actually look like? If the government woke up tomorrow and said that all wealth would be equally distributed, what would the numbers show?
Total Income Equality
The total gross domestic product (GDP) of the United States was $23.32 trillion in 2022. The total adult population of the United States is about 258 million people. Under complete income equality, each American adult would make $90,387 per year. For some of you, that is going to sound like a dream come true. For others, that number simply won’t cut it. That would make the take home pay for a two income household $180,775 per year, which looks a lot better.
However, if you take out taxes, the numbers start to come back down again. The average net income tax in the United States is 24.9%.
After taxes, equal income would be $67,880 for a single adult and $135,762 for a household per year.
No one would make a penny more or a penny less under true income equality. A McDonald’s cashier would make the same amount of money per year as Elon Musk.
Total Wealth Equality
When you look at total wealth equality, the numbers will look better or worse depending on your view of wealth and current economic status…