Well, this is more striking than I ever imagined. And apologies if it's been posted elsewhere, but I couldn't find it. I don't think the numbers are particularly controversial or debatable. My question is this: if, when someone talks about the wealthy in America, and you are someone who says "oh that's just CLASS WARFARE," well, wouldn't you say class warfare is happening, starting circa 1980, whether we talk about it or not? My only thesis would be this: the current situation (as depicted here over 27 years of recent data) is not sustainable. It's not stable. Having all the money with fewer and fewer people is inherently bad for the great majority. It's just not a healthy economic situation, and we are essentially squandering our nation's greatness to line the pockets of a relatively few fat cats. As I've said before, this is looking more and more like the America of 100 years ago. (Or as a recent SNL skit had Bachmann say, "the American of thousands of years ago, where feral bands of mud people lived in caves..." If that sounds "liberal," okay. I just think it's pretty simple. We are headed towards "feral bands of mud people." Great. Cue national anthem.
I get the message your graph is sending but I don't know what the %'s on the vertical axis mean. Is that percent change in income from the beging year (1947 and 1980)? And why does the left half not have a TOP 1%? Class means order, and more specifically it means military order. Poor people in England circa the barbarian invasions did not have class (order) because they a part of the military. So the ruling class is infact the ruling military order. So basically if your daddy wasn't rich and powerful you were poor and everything you did and have lacked class. What would George W. Bush have been doing if his daddy didn't have owned an oil company? Not saying it applies to every rich or poor person, but I got to think an alcoholic son of a goat herder isn't going to be treated the same as the alcoholic son of the CIA director/oil company owner/some other stuff. Definitely don't see the American people electing the alcoholic son of a goat herder President of the United States. Though I could be wrong.
This chart is a bit deceptive in that real wage income increases stopped at about 1970, not 1980, and doesn't account for the fact that we were coming out of the great depression & WWII. But, I do think the income disparity has become too great in the past few decades.
What is the solution to income disparity? You can't ask the wealthy to stop making money. I am assuming that chart just shows income based on the title. Also, I'd like to see the top 1% from the chart on the left. That is the only thing that is significantly out of whack.
I think what you have seen is that too much tax break has been given to the wealthy and that has moved money away from the middle class. This is not inevitably good for the wealthy, since if the number of dissatisfied people increases, you get revolution and the wealthy can kiss their wealth good bye - and perhaps more.
Who cares Ron Paul and Fox News tell us if we are just patient, th pie will grow incredibly and will eventually trickle down. Besides who cares? We have I-pads and reality TV
Googling around for something different, I stumbled on this article that argues why the class disparity isn't as bad as it looks: http://www.stlouisfed.org/publications/pub_assets/pdf/itv/2010/ITV_sp_10.pdf It has some stuff that I disagree with, but I thought it was interesting anyway.
Why is the chart comparing a different number of years, and including the Top 1% on only one side. While what we see on the right is alarming, I find the comparison itself to be misleading.
I think there are some skews to the chart, but its obvious that there is a disparity in income growth over the skewed time periods. Post the great depression we essentially shut down the border and stopped immigration creating a very homogenous society up until the late 1960's. The 1970's - 1980's to present had an ENORMOUS influx of immigrants, much of whom were lower income latinos almost became a low end working class taking the typical construction worker, bus boy etc. and taking it at much lower wages. I believe this helped all Americans as prices for goods and services fell and people were able to reinvest in themselves and starting businesses and such to create commerce. It could have created a wider divide in income levels based on this huge influx of low income population and forcing people here to get educated otherwise they would make very, very little. Even in this economy the unemployment rate for non-college educated people is several points higher than educated ones. Though we're a diverse nation, if one wants to be able to live here, an education is almost mandatory. I am very much for legal immigration but feel it may have had a part in skewing those statistics among the other time and situational bias' coming out of the great depression where unemployment rates were 25% in the 1930's.
Do you really expect for the middle class to profit from higher taxes on the wealthy? I'm in the middle class and I don't expect for the government to "move money" from anyone to me. I expect to keep paying taxes. The above statement is really kind of disturbing. People that are dissatisfied with what? Dissatisfied with the amount of money that is "moved" from the wealthy to them? I agree with juicystream that the chart really doesn't show anything because you don't compare the top 1% and the number of years is different. Another case of statistics saying whatever the user wants them to say.
I am not sure you understand the role of gov't in sustaining the middle class. Smaller gov't inevitably hits the poor and middle class harder. Less investment in education, technology, research equates to both a financial loss as well as a knowledge drain. It doesn't hurt the wealthy since they can move their assets to the places in the world where that investment is occurring. as unemployment rises and the standard of living lowers, and jobs continue to move overseas, eventually people will begin to push into the streets. You already see this in places like Greece. Economic collapse can happen in a capitalist nation. It has in fact happened here before in the 1930's. And it can happen to a degree that destabalizes the gov't and results in revolution. Right now it's not likely, but if dissatisfaction with gov't and economic conditions continue for say another 10 years, which is not out of the realm of possibility - there is a small but definitive risk.
I think it's already been addressed, but the money the government has to invest in science, infrastructure, education, all directly benefit the middle class. Really it benefits everyone but the middle class most of all. Cutting government spending in those areas hurts the middle class most of all. The wealthy are fine. Because of our huge debt problem cuts in spending need to be made. So far those cuts are all hurting the middle and lower classes much more than the wealthy. Taxing the wealthy is only spreading the sacrifice and may help keep some of the investment in programs that help the lower and middle classes alive. It isn't about lowering the middle class tax bracket, though that may happen.
Actually, if you cared to investigate the matter, he takes issue with the fact that the US was taken off the gold standard in the mid 70's and the currency has since been manipulated and inflated helping only those top tier individuals at the expense of everyone else. In his opinion, having a fiat currency system has helped contribute to the income inequality issues due to the FED's actions involving interest rates and them acting as a safety net to the banking industry to engage in moral hazard.
Interesting (yet long) documentary that might help shed some light on the current economic problems in this country: <iframe width="560" height="315" src="http://www.youtube.com/embed/JXt1cayx0hs" frameborder="0" allowfullscreen></iframe>
I don't think the different number of years matters. The story of the graph is that the post-war decades saw roughly equal economic growth for all quintiles, and the more recent decades see a lot more growth for the 5th quintile than for the others. So you're comparing quintiles to one another over the same timeframe (x2), not comparing one timeframe to the other. And, the 1% bar is just an elaboration on why the 5th quintile is outstripping the others. Adding it to the left-hand data-set wouldn't be very meaningful (unless it was also big and the rest of the quintile was in the toilet, which seems unlikely). *** I found what I was looking for earlier, the current quintile divisions (courtesy http://en.wikipedia.org/wiki/Household_income_in_the_United_States, which actually has a lot of interesting stuff in it): 1: $0 to $18,500 2: $18,500 to $34,738 3: $34,738 to $55,331 4: $55,331 to $88,030 5: $88,030+ (with top 5% starting at $157k) This is household income as reported to the IRS on our tax returns.
It is not mysterious. Return to the tax rates on the wealthy before 1979. Fox and Ron Paul and the wealthy and their favorite economists and pundits would have you think it is oh so complicated. BTW nobody "ask(ed) the wealthy to stop making money."
My concern is that it may be meaningful. In a comparison like this, you should compare equal data, and they didn't do that. When bias is involved, it is especially important to show all data, because it calls into question why the data was omitted. I find it curious that they chose those specific 32 years, and then the next 27 years. Just seems like odd time periods to choose to me. Given how the answer fits perfectly what they wanted to illustrate makes me believe they picked an answer, and searched for data, rather than grabbing data, and finding an answer. Obviously, there is a problem with the income disparity in this country.
