Forget the 1 percent, what about the 45 percent?

Inequality is the political trope du jour. Few would disagree that the U.S. economy is failing many if not most Americans, as some have moved into the economic fast lane while many are stalled or have exited the highway of opportunity.

Donald Trump has called the U.S. economy "rigged," with "our workers' loyalty repaid with betrayal," and Hillary Clinton has said: "We need to make sure our economy works for everyone, not just those at the top."


Although most talk about inequality focuses on the "1 percent," or the 0.1 percent, arguably the more relevant and troubling percentage in terms of Americans' economic insecurity is the 45 percent. Here's where the statistics get heavy, but bear with me:

•Nearly 45 percent of employed workers are paid less than $15 per hour — not a living wage in most of the country.


Close to 44 percent of American households are "asset poor," without enough money in the bank to make do for three months at the poverty level without any income.

Forty-five percent of private-sector workers do not have access to an employer-provided 401(k) or other retirement-savings plan. At the same time, with overall longevity increasing, the average number of years lived in retirement has gone up from about eight years in 1950 to 21 to 24 years today, meaning that older Americans will need more assets and income than ever. (As a consequence of low wages and lacking retirement savings, more than one-third of retirees rely on Social Security for nearly all of their income.)

Indeed, some safety-net and income-boosting policies — from Social Security and Medicaid to the Earned Income Tax Credit and food stamps — attenuate income inadequacy. While these benefits help tens of millions of Americans, they are paltry compared to the need and what other rich countries provide.

But, let's move on with the 45 percent.

That same percentage of workers in the private sector receive no paid sick leave from their employers.

Among parents with young children, more than 45 percent of 3- and 4-year-olds are not enrolled in preschool, primarily because of cost, even though early-childhood education yields enormous intellectual and social benefits and is supported by both the Obama Administration and the U.S. Chamber of Commerce.

As home-ownership rates have declined and foreclosures increased after the Great Recession, 41 percent of U.S. households have no equity in a home.

And the poorest 40 percent hold just 0.3 percent of the nation's total net worth, whereas the wealthiest 1 percent control about 40 percent.


These are not all the same people, but they are largely overlapping populations. In addition, there are others who are insecure in different ways — burdened with huge college, health-care or credit-card debt; working in unstable jobs as contractors, with unpredictable hours, or part-time not by choice; are on disability or are ill; or have dropped out of the labor force.

There are several lessons to draw.

First, far more Americans live on, or off, the edge than official poverty or unemployment data would suggest.

Second, we need a more holistic way of looking at economic insecurity. Focusing on low wages and bad jobs is not enough. Although Bernie Sanders based his campaign on the premise that wealth and income inequality is the great moral, economic and political issue of our time, neither many of those on the left nor Donald Trump really unpack what wealth inequality means throughout the life cycle.

American workers don't just need higher wages from steady, good jobs, and income supports, if necessary, to pay the monthly bills. They also need savings, assets and "nest eggs" for emergencies, to buy a home, pay for their children's college or preschool, have decent living standards in later life and simply to be able to enjoy life.

To understand the discontents of 2016 and to forge a path toward the oft-cited goal of "broadly shared prosperity," candidates and political leaders, as well as advocates and the American people need to think about the many ways in which the 45 percent are struggling. We need to think of the human costs, the costs to our economy and the potentially catastrophic costs to government — and taxpayers — if it has to bail out nearly half of all Americans.


Raising the minimum wage, expanding retirement-plan coverage, providing paid sick and family leave and universal preschool, changing the tax code so that the 45 percent benefit more, incentivizing savings and building a stronger safety net are all necessary. But none is sufficient unless part of a broader strategy that knits these and other economic-security policies together.

Andrew L. Yarrow, a senior fellow in the Aspen Institute's Financial Security Program, is a writer and historian whose books and articles have explored the intersections among economics, culture and politics. His email is