300,000 new millionaires: How many new homeless?
The booming stock market just created 300,000 new millionaires, but at the other end of the economy, food stamp participation just hit a 10 year high.
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Nationally, Mishel says the declining value of the federal minimum wage is a major factor driving inequality. On Monday, in an effort to address this, minimum hourly wages will rise from $8 per hour to a new minimum of $10 per hour, the nation's largest minimum wage increase approved by voters last fall. While it's a dramatic shift for tens of thousands of workers, it's a minuscule fraction of the increases top earners in the region enjoyed last year.Skip to next paragraph
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Silicon Valley's top tech magnates inched up the Forbes annual list of the richest people on the planet released this week: Oracle Corp. CEO Larry Ellison had a reported net worth of $43 billion, Google co-founders Larry Page and Sergey Brin had about $23 billion each, Facebook CEO Mark Zuckerberg, was worth an estimated $13.3 billion, and Laurene Powell Jobs, widow of Apple Inc. co-founder Steve Jobs, had an estimated worth of $10.7 billion.
"The wealth numbers are staggering, they are absolutely staggering," said Alf Nucifora, who chairs the Luxury Marketing Council of San Francisco
One in five ultra-wealthy Americans, defined by having a net worth above $30 million, lives in California, stoked by the "wealth-generating cluster" of the Silicon Valley, according to WealthX, a company that tracks the super-rich. Stanford University, in Palo Alto, boasts 1,173 alumni with a net worth of more than $30 million — only Harvard University and the University of Pennsylvania have more.
"The Silicon Valley is an ecosystem of human capital, venture capital, risk, an educational infrastructure," says WealthX president David Friedman. "All of those things combine into this glorious cocktail of prosperity."
But many residents, even those with college educations, are finding it tougher than ever to make it in the Silicon Valley.
Before the Great Recession, about 10 percent of people seeking food had at least some college education. Today, one in four who line up at food pantries for bags of free food have been to college. Last year the share of households in Silicon Valley earning less than $35,000 rose two percentage points to 20 percent, according to the 2013 Silicon Valley Index.
"There are millionaires, even billionaires, who sit in their sunrooms watching me work in their gardens and they have no clue what's going on," said Sherri Bohan, a credentialed horticulturist who ran a landscape gardening firm for 30 years and raised two sons as a single mom. Today, retired and disabled, she picks up a free bag of groceries every week at her local food bank. Without the food she says she would go hungry.
Silicon Valley's rich do give, and often significantly, but the money mostly leaves the area. Facebook's Zuckerberg gave $100 million to Newark N.J., public schools in 2010; his $500 million gift to the Silicon Valley Community Foundation last year has yet to be designated. The Google Foundation donated about $11 million in 2011, according to its tax forms, largely to global environmental and health projects.
"Many people come here to work, but they have no idea what's really going on," said Lisa Sobrato Sonsini, whose Sobrato Family Foundation — funded by profits gained as a leading real estate and development firm in the region — is the single largest contributor to local charities in the region. "The companies are generous, but they don't see the need directly in front of them, they want to send their money away."
Phyllis Kizer, a long time high-tech business analyst, is disturbed by the challenges people in her community face.
"Looking at myself, I'm very well paid for what I do, I have no complaints," she said.
Once a week, Kizer heads to a low income school where she sits with children, including recent immigrants, helping them learn to read.
"I love books, and I love teaching," she said. "I wanted to pass that on. Some of these children, they can really go far, but we need to help."
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