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Gap between U.S. rich, poor is widest in Atlanta

Atlanta has widest income gap between rich and poor of all the major U.S. cities, the U.S. Census reported on Wednesday. New Orleans ranked second, followed by the U.S. capital, Washington, D.C.
/ Source: msnbc.com news services

Atlanta has widest income gap between rich and poor of all the major U.S. cities, the U.S. Census reported on Wednesday. New Orleans ranked second, followed by the U.S. capital, Washington, D.C.

Areas with the highest income inequality "tend to be found in cities, with older housing on average, while the most income-segregated areas ... tend to be found in the suburbs," the census reported.

Rounding out the list of 10 big cities with the largest gaps between high and low income are Miami, Fort Lauderdale and Gainesville, all in Florida; Athens, Ga.; New York; Dallas; and Baton Rouge, La.

The major cities with the lowest income inequality were almost all in the West, and all had much smaller populations.

West Jordan, Utah, had the smallest gap; it has a population of 101,727. Thornton, Colo., and Norwalk, Calif., followed.

The U.S. recession that began in 2007 took a steep toll across the country, with only a few places spared from a rise in jobless rates and a decline in incomes. Nearly two years after the recession officially ended in 2009, the U.S. unemployment rate remains above 9 percent, and the poverty rate tops 15 percent.

Income levels have taken a dip for families nationwide. For example, median household income dipped to $49,445 in 2010 — the lowest since 1996, census figures showed.

Anger over the widening gap between rich and poor has stirred protesters who identify themselves as "The 99 Percent" who are occupying a park near New York's Wall Street and other locations across the country. They say they want to "end the greed and corruption of the wealthiest 1 percent of America," according to the website www.occupytogether.org.

Income levels for the top 1 percent far outgrew others.

"For the 1 percent of the population with the highest income, average real after-tax household income grew by 275 percent between 1979 and 2007," said the report from the Congressional Budget Office, a nonpartisan budget and tax analysis arm of Congress.

Hot issue
America's shrinking middle class has become a hot topic for President Barack Obama as he runs for reelection and for the Republicans currently vying to challenge him in the 2012 election.

In a paper released on Wednesday, the Economic Policy Institute, a think-tank, found that the ratio of the wealth held by the richest 1 percent of U.S. households to that held by the median household was 225-to-1 in 2009.

Among small cities, Fountainhead, Md., has the greatest gap between rich and poor, and Country Knolls, N.Y., the smallest, census data showed.

Between January 2005 and December 2009, the census interviewed residents in tracts with an average population of 4,825 in the hopes of understanding incomes at the neighborhood level. It found that the 10 areas with the biggest gaps between rich and poor also had low income levels, a large number of households with no one employed, and high vacancy rates.

Downtown Cleveland had the greatest gap between rich and poor. The neighborhood is dominated by individuals living alone, mostly women and mostly black, who tend to have incomes of under $10,000 per year and receive food stamps.

The agency also pulled back to look at the states. New York has the widest gap between rich and poor, followed by Connecticut and Louisiana. Using three separate measures, the Census found those states, along with Mississippi, Texas, Alabama and California, have greater income inequality than the nation as a whole.

Utah, Alaska and New Hampshire have the smallest gaps.

Reuters and msbc.com staff contributed to this report.