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Wealth Gap Has Slowed Economic Recovery, S&P Says

The rising tide lifts all boats, or at least that's what many economists have argued concerning how the wealthy can influence the economy. Now, however, credit ratings agency Standard & Poors says: "A lifeboat carrying a few, surrounded by many treading water, risks capsizing." A new analysis by S&P says the widening gap between the wealthiest Americans and everyone else has made the economy more prone to boom-bust cycles and slowed the 5-year-old recovery from the recession. Economic disparities appear to be reaching extremes that "need to be watched because they're damaging to growth," said Beth Ann Bovino, chief U.S. economist at S&P. The rising concentration of income among the top 1 percent of earners has contributed to S&P's cutting its growth estimates for the economy. In part because of the disparity, it estimates that the economy will grow at a 2.5 percent annual pace in the next decade, down from a forecast five years ago of a 2.8 percent rate.

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-- The Associated Press and NBC News staff