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U.S. Income Gap: Most Americans Think Growing Divide Bad For Country, Wealthy Should Pay More Taxes

08/27/2012 12:28 EDT | Updated 10/27/2012 05:12 EDT
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OAKLAND, CA - DECEMBER 06: Occupy protester Guillermo Elenes (R) holds a sign as he protests in front of a Chase Bank during a demonstration against home foreclosures on December 6, 2011 in Oakland, California. Occupy Wall Street groups across the country are staging a day of action against home foreclosures and are protesting outside banks and attempting to re-occupy homes that have been foreclosed. (Photo by Justin Sullivan/Getty Images)
WASHINGTON - As the income gap between rich and poor widens, a majority of Americans say the growing divide is bad for the country and believe that wealthy people are paying too little in taxes, according to a new survey.

The poll released Monday by the Pew Research Center points to a particular challenge for Republican presidential candidate Mitt Romney, whose party's policies are viewed by a wide majority as favouring the rich over the middle class and poor.

The poll found that many Americans believe rich people to be intelligent and hardworking but also greedy and less honest than the average American. Nearly six in 10, or 58 per cent, say the rich don't pay enough in taxes, while 26 per cent believe the rich pay their fair share and 8 per cent say they pay too much.

Even among those who describe themselves as "upper class" or "upper middle class," more than half — or 52 per cent — said upper-income Americans don't pay enough in taxes; only 10 per cent said they paid too much. This upper tier was more likely to say they are more financially secure now than 10 years ago — 62 per cent, compared to 44 per cent for those who identified themselves as middle class and 29 per cent for the lower class. They are less likely to report problems in paying rent or mortgage, losing a job, paying for medical care or other bills and cutting back on household expenses.

The findings come at the start of this week's Republican National Convention and as both Romney and President Barack Obama seek to appeal to a broad swath of financially struggling voters who identify as middle class. Romney supports an extension of Bush-era tax cuts for everyone including the wealthiest 2 per cent, and says his policies will benefit the middle class by boosting the economy and creating jobs.

"The fact that Romney may be viewed as wealthy doesn't necessarily pose problems for his candidacy," said Kim Parker, associate director of Pew Social & Demographic Trends, noting that people see the wealthy as having both positive and negative attributes. "The challenge for Romney lies more in the fact that large majorities say if he is elected president, his policies would likely benefit the wealthy."

The results reinforce a tide of recent economic data showing a widening economic divide. America's middle class has been shrinking in the stagnant economy and poverty is now approaching 1960s highs, while wealth concentrates at the top. A separate Pew survey earlier this year found that tensions between the rich and poor were increasing and at their most intense level in nearly a quarter-century.

In fact, well-off people do shoulder a big share of the tax burden. Though households earning over $1 million annually comprise just 0.3 per cent of all taxpayers, they pay 20 per cent of all federal taxes the government is projected to collect this year, according to the Tax Policy Center, a nonpartisan group that studies tax policy. The figures included income, payroll and estate taxes. In contrast, households earning $50,000 to $75,000 a year accounted for 12 per cent of taxpayers and contributed 9 per cent of federal taxes, the centre's data showed. Some 46 per cent of households pay no federal income tax at all, although they do pay payroll, excise and other taxes.

According to the latest findings, about 63 per cent of Americans say the GOP favours the rich over the middle class and poor, and 71 per cent say Romney's election would be good for wealthy people. A smaller share, 20 per cent, says the same about the Democratic Party. More Americans — 60 per cent — say if Obama is re-elected his policies will benefit the poor, while half say they'll help the middle class and 37 per cent say they'll boost the wealthy.

"The Great Recession was not an equal opportunity disemployer," said Sheldon Danziger, a public policy professor at the University of Michigan who describes the gap between rich and poor as the widest in decades. "College graduates, whites and middle-aged workers had fewer and shorter layoffs than high school graduates, blacks, Hispanics and younger workers. And, only a small percentage of the rich work in the hardest-hit industries, like construction and manufacturing."

About 65 per cent of Americans say the gap between rich and poor has gotten wider in the past decade, while 20 per cent believe it has stayed the same and 7 per cent say the gap has gotten smaller. Separately, 57 per cent say a widening income gap is a bad thing for society; just 3 per cent say it is a good thing.

Asked to estimate how much a family of four would need to earn to be considered wealthy in their area, the median amount given by survey respondents was $150,000. For middle class, the median amount was $70,000.

Many Americans see rich people as more likely to be intelligent (43 per cent) and hardworking (42 per cent) than average Americans. But the rich are also seen as more likely to be greedy (55 per cent). Thirty-four per cent of those surveyed say the rich are less likely to be honest than the average person; just 12 per cent say the rich are more likely to be honest.

The Pew survey involved telephone interviews with 2,508 adults conducted from July 16 to 26. It has a margin of error of 2.8 percentage points.

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AP Deputy Director of Polling Jennifer Agiesta and reporter Alan Fram contributed to this report.

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Online:

Pew Research Center: http://pewsocialtrends.org/

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