China's Dramatic Poverty Reduction Contrasts with Rising US Income Inequality
China has achieved a significant reduction in poverty over the past decades. In 1990, approximately 943 million people, or 83% of the population, lived on less than $3 per day (adjusted to 2021 dollars). By 2019, this number was effectively zero, according to World Bank data.
In contrast, poverty levels in the United States have worsened. More than 4 million Americans, about 1.25% of the population, now live on less than $3 per day—over three times the number recorded 35 years ago. Despite the US having an output per capita roughly six times that of China, a greater number of Americans live in poverty than Chinese citizens.
The US has also seen a deterioration in income distribution. The share of middle-income earners in national income declined from 52.5% in 1980 to 42.5% in 2023 relative to the top 90th percentile. The poorest 10% of Americans hold about 1.8% of national income, a share comparable to that of poor populations in Bolivia (1.8%), Nigeria (3%), China (3.1%), and Bangladesh (3.7%).
Policy measures under the Trump administration, including the Big Beautiful Bill Act and tariffs, are projected to increase costs and reduce subsidies for programs such as Medicaid, the Affordable Care Act, and SNAP. Estimates from the Yale Budget Lab suggest these policies would lower household income for all but the richest fifth of the population, with the bottom 10% experiencing an approximate 7% cut.
This trend of income gains favoring the wealthy has persisted under most administrations since Carter, with temporary boosts for poorer incomes during pandemic subsidies under Clinton and Trump’s first year. The article concludes by questioning how a democracy like the United States struggles to share wealth effectively despite its economic strength, while China has substantially reduced poverty, though without endorsing China's governance model.
