Most of this is caused by a huge increase in the profit per man-hour worked in the financial industry. The average hour worked in the financial industry generates nearly 30 times the average profit per-man-hour in the rest of the economy.
And these extreme financial sector profits are largely attributable to subsidies, such as: the mortgage-interest deduction, student loan aid, federal guarantees on debt, the preferential tax rates on capital gains and dividends, interest on reserves at the Fed, and the FDIC guarantee, as well as the substantial implicit regulatory subsidy known as "too-big-too-fail".
