Income gap grew in Conn. during 1990s

The gap between Connecticut’s low-income and high-income families has widened in the past decade despite a contrary national trend, according to a report released yesterday by a state social advocacy group.

The report, called “Pulling Apart in Connecticut: Analysis of Trends in Family Income,” found that Connecticut was one of only two states in which the poorest 20 percent of families lost real income and the wealthiest 20 percent gained in the 1990s.

The report comes at a critical time as the state Legislature struggles to balance the budget, and funding for social service programs is at risk of being cut. The group that released the report, Connecticut Voices for Children, is now exhorting the state to leave welfare programs untouched and instead cut its deficit by raising income taxes on the wealthiest.

“It’s important that state policy-makers have this information in their hands now,” said Elizabeth McNichol, the director of the Center on Budget and Policy Priorities’ state fiscal project. Connecticut Voices for Children assembled the report in partnership with the CBPP and the Economic Policy Institute, which released its own national analysis yesterday that examined families’ incomes on a state-by-state basis.

According to the report, the gap between the rich and poor grew during the 1990s despite a slight closing of the gap nationally. The average annual income of the poorest fifth of Connecticut’s population, with inflation adjustments, fell 19.4 percent, while the income of the richest fifth grew 21.2 percent. Nationally, the average annual income of the poorest fifth rose 12.3 percent.

The report also claimed that this growing inequality came at the loss of the country’s “social cohesion.”

“Instead of people pitching in to help the economy grow, people can feel they are not as connected to the future of the country,” McNichol said.

The report also said that Connecticut’s gap has widened more than in any other state during the past three decades. In the late 1970s and 1980s, the richest 20 percent had an average annual income six times greater than the poorest 20 percent. In the 1990s, that ratio rose to nine-to-one. The report found that only the District of Columbia had a greater increase during that period.

Shelley Geballe, a co-president of Connecticut Voices for Children, said the state should not cut its social service programs as it tries to balance its budget, especially in light of the new data,

“The budget should not be balanced on the backs of the people who have already lost a lot of ground,” she said.

But Chris Cooper, a spokesman for Gov. John G. Rowland, said the programs will not be losing money but will instead receive smaller increases in funding.

“The fact of the matter is that none of these programs will lose money,” Cooper said. “They’re still getting more money than they did last year.”

Cooper added that the governor has used a multi-agency approach to help the state’s poor. He cited health programs for uninsured children, an emphasis on funding community colleges, and the state’s various work centers that assist the unemployed.

In another telling statistic, the report said that in the 1990s, the $31,635 increase in the average annual income for Connecticut’s wealthiest 20 percent — from $149,558 to $181,194 — was 1.6 times as much as the average total income for the poorest 20 percent, or $19,351.

“Clearly the job is not done, but I think we continue to try and make progress,” Cooper said.

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