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U.S. Sen. Bernie Sanders starts with the nation’s richest family when describing the magnitude of wealth inequality in the United States.
"Today in America one family, the Walton family of Walmart. You all heard of Walmart. This one family owns more wealth than the bottom 40 percent of the American people," Sanders, I-Vt., said recently in Norfolk during a rally for his campaign for the Democratic presidential nomination.
PolitiFact has looked at similar claims in the past from Sanders and other liberals, but the last time was in 2013. Since the statement has become a standard line in Sanders’ campaign speech, we decided to give it a new examination.
The claim originates from research by Sylvia Allegretto, an economist at the Institute for Research on Labor and Employment at the University of California-Berkeley. She last updated her research in 2014.
Allegretto tallied the total wealth held by the six relatives of Walmart founder Sam Walton: his sons Jim and Robert Walton; daughter Alice Walton; daughter-in-law Christy Walton; and his nieces, Ann Walton Kroenke and Nancy Walton Laurie.
Using figures from the Forbes list of the 400 richest Americans in 2013, Allegretto totaled the wealth of those six Waltons at $145 billion.
Next, she turned to a survey of the net worth of Americans published every three years by the Federal Reserve. The most recent one was published in 2014 based on survey results from the previous year. The combined worth of the Walton clan in 2013, Allegretto said, "equaled the total wealth of the entire bottom 43 percent."
We should point out that this is not a measure of "income" - the amount of money families earn every year.
Instead, wealth is the bottom-line figure of a household’s "net worth." As our colleagues at PolitiFact Wisconsin pointed out in their 2013 fact-check, net worth is the amount left over after accounting for things such as savings and retirement accounts minus what’s owed on home mortgages, credit card bills and other debts.
That means it’s entirely possible for someone earning a six-digit salary to be in the "bottom 40 percent," because all their debts still could leave them with zero or even negative net worth.
Tim Worstall, a fellow at the Adam Smith Institute free-market think tank in London, has been critical of comparing the Walton wealth to people of modest net worth. Worstall noted in a 2011 op-ed in Forbes that many high earners easily could fall into the category of zero or negative net worth, such as doctors still paying off loans from attending medical school.
"If you’ve no debts and have $10 in your pocket, you have more wealth than 25% of Americans. More than that 25% of Americans have collectively that is," Worstall wrote.
Josh Bivens, research and policy director at the Economic Policy Institute, a liberal Washington think tank, looked at the figure another way in a 2014 post. Noting that the Federal Reserve placed the median U.S. family wealth the previous year at $81,200, he wrote that it would take 1.7 million families with that amount of net worth to equal the wealth of the Waltons, he said.
The Walton wealth has not been static since 2013. Forbes this year published figures showing the family’s wealth has declined to $121.9 billion -- a drop of $23.1 billion. Forbes explained it lowered the net worth held by Christy Walton after new information surfaced showing that her late husband, John - Sam Walton’s son - left some of his fortune to charity.
We wondered whether that reduced $121.9 billion figure still would leave the Waltons’ wealth equal to about 40 percent of U.S. families. Allegretto was unavailable to run a new set computations for us.
So we turned to the Urban Institute, a Washington non-profit specializing in economic social research. Its numbers show that Sanders’ claim remains correct based on the latest national wealth figures from 2013.
Sanders said the Walton family "owns more wealth than the bottom 40 percent of the American people."
The latest comparable figures, from 2013, support his claim. We rate it True.
Sen. Bernie Sanders’ comments at Norfolk Rally, Feb. 23, 2016.
Email from Warren Gunnels, policy director for Bernie Sanders presidential campaign, Feb. 24, 2016.
Email from Sylvia Allegretto, a labor economist at the Center on Wage and Employment Dynamics at the University of California-Berkeley, Feb. 23, 2016.
The Berkeley Blog, "One step up and two steps back," Oct. 2, 2014.
Forbes, "Forbes 400," accessed March 3, 2016.
Forbes, "The world’s billionaires," accessed March 3, 2016.
Emails from Laura Greenback, spokeswoman for the Urban Institute, March 8-9, 2016.
Statement from Caroline Ratcliffe, senior fellow at the Urban Institute, March 8, 2016.
Email from Josh Bivens, director of research and policy at the Economic Policy Institute, March 7, 2016.
Email from Susan Stawick, spokeswoman for the Federal Reserve Board, March 7, 2016.
PolitiFact Wisconsin, "Just how wealthy is the Walmart Walton family?" Dec. 8, 2013.
PolitiFact, "Bernie Sanders says Walmart heirs own more wealth than bottom 40 percent of Americans," July 22, 2012.
Economic Policy Institute, "Inequality exhibit A: Walmart and the wealth of American families," July 17, 2012.
Economic Policy Institute, "Walton family net worth is a case study why growing wealth concentration isn’t just an academic worry," Oct. 3, 2014.
Federal Reserve, "2013 survey of consumer finances," Oct. 20, 2014.
Urban Institute, "Federal Reserve surveys of the economic well-being of U.S. households: SCF and SHED," Jan. 21, 2016.
Urban Institute, "Nine charts about wealth inequality in America," accessed March 9, 2016.
Federal Reserve Bulletin, "Changes in U.S. family finances from 2010 to 2013: Evidence from the Survey of Consumer Finances," September 2014.
Forbes, "Six Waltons have more wealth than the bottom 30 percent of Americans," Dec. 14, 2011.
Interview with Lydia Austin, research assistant at the Urban Institute-Brookings Tax Policy Center, March 3, 2016.
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