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Why Do We Want To Be Poorer and Less Equal Than We Are?

New Census data showing record levels of income and no increase in inequality should be cause for celebration.

Mark J. PerryMark J. PerryTwo of the major economics stories Americans tell about ourselves don't seem to be true. Yet we are really enamored with the ideas that income inequality is on the move, separating the wealthy from the rest of us ("we" rarely consider ourselves part of the wealthy), and that the middle class is on the verge of extinction (as Pew found recently, fully 47 percent of people in households making over $100,000 a year consider themselves "middle class").

Mark J. Perry of the American Enterprise Institute and the University of Michigan (Flint) has compiled Census data that refute these popular claims. "The Gini index measure of income dispersion reveals that there has been no significant trend of rising income inequality' for US household incomes over the last quarter century," he writes. "The Gini index in 1993 was 0.454 and last year it was 0.482, the same as in 2013, and this statistical measure of income inequality has also shown remarkable stability for the last several decades in a narrow range between 0.46 and 0.48."

There is, of course, an argument to be made that existing income inequality is too vast (and it is indeed larger than it was in the 1970s, both in America and throughout most advanced economies). But as Perry notes, that isn't the case being advanced:

We hear all the time about "rising income inequality" in America (there are more than 100,000 Google search results for that term), about "the rich getting richer and the poor getting poorer," the "stagnant or disappearing middle class," all of the recent income gains going to the rich," the lack of income mobility and other narratives of pessimism. In a December 2013 speech, President Obama described rising income inequality as the "defining challenge of our time" and promised that for the rest of his presidency, he and his administration would focus all of their efforts to stop the increase in income inequality. And yet, the data in today's Census Bureau tell a much different story. [emphasis in original.]

Perry notes that median household income in 2017 reached $61,372, a new record and the fifth consecutive year of increase. When you adjust for the smaller sizes of households, things look better still:

Compared to 1975, the average household income per US household member has increased by 74% from $19,500 to $34,000, while the median household income per person has increased by 45% from $16,600 to $24,160. Without adjusting for household size, average household income increased by only 50% since 1975 (vs. 74% adjusted for average household size) and median income increased only 25% (vs. 45%), demonstrating the importance of adjusting for changes in household size when comparing median household incomes over time.

There's also little doubt that standards of living have improved dramatically over time. By virtually any measure, food today is better than it was in the past, and cheaper too. The same goes for virtually any consumer good, with exceptions for health care and education (which are both more expensive when adjusted for inflation) and, in some part of the country, housing as well. But even there, there are many improvements. Anyone who wears glasses can tell you that frames keep getting more expensive and stylish but lenses keep getting thinner, lighter, and more scratch-resistant while staying about the same in nominal dollars.

Perry's data also tells a welcome story about the "vanishing" middle class. To the extent that it's shrinking, it's because more people are making more money, not less.

Mark J. PerryMark J. Perry

There are more charts and discussion at Perry's invaluable Carpe Diem blog.

It's self-evident (maybe) why politicians want to talk about increasing income inequality and a vanishing middle class. They posit themselves as solutions to such problems, either via regulation and redistribution (on the left) or champions of much-needed economic vitalism (on the right). The media are often willing to play along, perhaps sensing a good story or perhaps simply being bowled over by agenda-driven research. (The latter seems to be the case in Time's recent ridiculous cover package about teachers needing to sell blood plasma simply to get by.) People getting poorer all the time is a variation on "if it bleeds, it leads."

But why are the rest of us so quick to buy in to the idea of eroding standards of living and fairness? At least since 1995, Reason has run some variation of the data Perry pulled together (read "The Good Old Days Are Now") and they almost always show progress. There are times, such as during the financial crisis, when earnings and assets absolutely took a hit, but what's amazing is how resilient the declinist narrative is even in relatively good times. We really, really want to be worse off than we are.

Economists such as Cornell's Robert Frank argue that humans seek relative status above virtually anything else, so that if we're all better off, that doesn't really make us feel any better. That may be part of an answer, but it's odd then that objective increases in well-being rarely get discussed. Even increases in income undersell total compensation. As Reason's Veronique de Rugy has noted, fringe benefits have increased far more over the past 40 years than wages. We probably don't feel richer simply because the value of our employer-provided health insurance has increased by 60 percent.

Perhaps it's an age thing: You don't really appreciate what you have until you reach a certain age and the stories we tell ourselves are mostly written by people too young (or too old) to fully grasp social reality? Or perhaps the data that Perry and others pull are misleading, falling into the category on knowing the price of everything but the value of nothing?

The notions that the "middle class" is on the verge of extinction and that only the super-rich are making bank aren't new, but we are in a particularly intense moment of unreality when it comes to discussions of politics and policy. Trying to get a firm grasp on how people are actually doing is now even more urgent than it otherwise would be.

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  • Don't look at me!||

    Every new day is the best day in history.

  • Cy||

    Agreed. This chart, as do many, fail to take into account one's available freedom with their time and time left on earth.

    Warren Buffet stands very well off on that chart but he has little time left and a lot of freedom with that small amount of time.

  • LynchPin1477||

    and it is indeed larger than it was in the 1970s, both in America and throughout most advanced economies

    That's almost certainly true, but just how much larger is definitely up for debate. How you measure these things matters quite a lot, and it's not as straightforward as looking at a survey or IRS data.

    Here's a good EconTalk on this from a few years back
    http://www.econtalk.org/burkha.....dle-class/

  • Scarecrow Repair & Chippering||

    I hope that mentions the changing definition of "household" over time, but I'm not going to listen to it just to find out. A promising sign is "as well as whether you look at tax units or households" in the abstract.

  • LynchPin1477||

    They deal with that, but that's not the key point. He compares his results to Piketty's and says that he can get consistent results when using tax units instead of household income and looking only at pre-tax, pre-transfer income - in that case since the 1970s income only increased 3%. But if you analyze differently - using households instead of tax units (I forget the technical distinction there), and then looking at post-tax, post-transfer, with benefits (mostly healthcare), you go from 3% growth in median income since 1970s to 37%.

    The whole thing is worth listening to at some point if you are interested in this sort of thing.

  • Scarecrow Repair & Chippering||

    I've read enough critiques of Piketty to conclude he's just another mendacious statist hack contorting statistics to buttress his preclusions. Cherry picking data, switching between datasets at arbitrary times to shape curves to his expectations. Nothing honest or even close to it.

  • LynchPin1477||

    The critiques I've heard are far more gracious - that he and his co-author did a lot of hard and careful work compiling and analyzing data but that it tells an important but incomplete story. If take-home pay really has been flat for several decades, and people are relying more on government transfers and non-cash benefits to make up the difference, that is worth knowing and thinking about. Piketty is a leftist and I suspect he'd have a very different view of the underlying problem and how to fix it than I do, but still, the bare fact is probably important.

  • Fist of Etiquette||

    Equality of opportunity is the ideal, not equality of outcome. Things like regulatory capture makes the former out of reach for the lower rungs, but we get regulation peddled as the solution to the latter.

    Thank God we have people we can vote for to solve the problems that they tell us we have.

  • Diane Reynolds (Paul.)||

    Equality of opportunity is the ideal, not equality of outcome.

    Check out alt-right Jordan Peterson over here.

  • Leo Kovalensky II||

    By virtually any measure, food today is better than it was in the past, and cheaper too. The same goes for virtually any consumer good, with exceptions for health care and education

    I find it extremely telling that two areas where government is heavily involved in either providing directly, heavily subsidizing, or heavily regulating tend to by the exceptions to the rule on price increases.

  • ||

    Uncle Sammy has been regulating food production and distribution far longer than the other two economic sectors noted.

    Wonder why it's the exception?

  • Zeb||

    There is a lot of regulation and subsidy for food, but the state directly controls or pays for a lot more of education and healthcare than they do food. So functioning markets for food exist, while the markets for education and healthcare are all fucked up.

  • Earth Skeptic||

    Corn syrup!

  • MoreFreedom||

    It's not just how long the government has been regulating some industry, it's also to the degree it regulates and controls the industry. By far, government controls education and health care (and lately insurance) more than it does food. You don't have government laws, e.g., forcing grocers to feed the hungry when they show up at the store as compared to when they show up at an emergency room. Nor do you have a government monopoly of forced taxation funding food producers and distributors like we do for government schools.

    The markets for education and health care are simply freer than for food. Even though government subsidies exist for some farmers, it's small compared to government spending on government schools and health care.

  • ||

    I would have added housing to health care and education.

    Whereas agriculture is subsidized, it has not been subject to the same kinds of interventions to "make it affordable" as housing, health care and education. See also, urban mass transit, which is generally more expensive than fifty years ago or so but has largely been hidden by direct subsidies.

  • ||

    Mind you, as Zeb|10.1.18 @ 1:34PM points out direct subsidies in the form of payments to farmers have caused much less of a fuckup in functioning markets as the direct control that the government has taken over in the case of health care and education. The situation of housing markets is more complicated, in that while some sectors of government, ie the federal govt thru mortgage subsidies etc, have undertaken to make housing more affordable, other sectors of government have undertaken to make housing less affordable, ie local governments thru zoning laws etc which in most cases are design to keep voters support thru maintaining "home values" and to bolster tax collections thru ad valorem taxes,

  • ||

    In the case of housing, I think the fact that should be getting more notice is that the median house price has gone from two and a half to three times median household income to much more.

    Now, I'm not saying that that meant in some bygone day that "everyone" could afford a house, those in the lower entry levels as well as the profligate who spent everything they earned were precluded by not having the savings required for a down payment etc but the fact is that before the 1960s.

    This is not some nostalgic harking back to the 1950s but I think some attention needs to be paid to what part government at all levels has played in the inflation of housing prices prices.

  • vek||

    One thing to keep in mind with housing as well is that the average SIZE of a house has skyrocketed. So comparing apples to apples, housing prices have largely not budged in much of the country... The problem is that there are more people crammed into the parts of the country where they have legitimately gone through the roof.

  • Ken Shultz||

    Anthropologists write about social stratification as being a feature of a more evolved society.

    "Generally, the greater the social complexity of a society, the more social strata exist, by way of social differentiation.[3]

    http://en.wikipedia.org/wiki/Social_stratification

    When I live in the Yucatan, there was very little crime--but then there wasn't much difference between people in terms of possessions, etc. Everybody on my side of town as pretty much on the same level.

    Tribal societies have a chief, but under that, there isn't much in the way of difference between various people. I understand that slavery created a tremendous amount of social stress in tribal societies--when one person owned something (someone) that others didn't, and the slave was made to do chores that average people did. What did that make the rest of the tribe? Human sacrifice and cannibalism may have evolved as ways to alleviate that social stress. You could have your slave for a while, but, after that, your slave would be consumed by the entire tribe.

    A more advanced society may require the two commandments against socialism: 1) Thou shalt not steal 2) Thou shalt not covet.

    Wanting an end to social stratification may just be a primitive impulse--the same kind of thing that makes children cry in the grocery store aisle because mommy won't buy them a piece of candy.

  • LynchPin1477||

    We probably don't feel richer simply because the value of our employer-provided health insurance has increased by 60 percent

    Some of that is no doubt due the relative invisibility of total health care costs vs take home pay, but part of it is also that a decent chunk of that 60% is price inflation.

  • Azathoth!!||

    WHAT?

    Reality DOESN'T line up with leftist dogma?

    Unpossible.

  • Unicorn Abattoir||

    Obviously reality is incorrect.

  • LynchPin1477||

    Or perhaps the data that Perry and others pull are misleading, falling into the category on knowing the price of everything but the value of nothing?

    I think this is a big part of it. I wouldn't say the data are misleading, but that they fail to capture all the things that people care about and that give their lives meaning.

    That, and a lot of people seem to love drama, even as they decry it. It almost seems like an addiction.

  • Scarecrow Repair & Chippering||

    Anyone comparing income by household is an idiot if they don't compensate for changing definitions of household. Kids leaving home sooner or later, people keeping roommates longer because housing costs are too damned high, adults moving in together sooner or later, or getting married sooner or later, retirees living independently longer.

    Buncha damned useless things, statistics per household, other than being fodder for politicians and malcontent activists.

  • sarcasmic||

    It feels true so it must be true, facts be damned.

  • Leo Kovalensky II||

    That's the basis for the whole income inequality farce. Everyone wants more money and thinks they aren't as well off as they should be. All politicians need to do to feed off of this is to stoke our own human nature and say that it's not fair that we're not doing as well as some other guy.

  • MikeP2||

    Just love how you refute a major Dem talking point, but at no point make any reference to the fact that it is a major Dem talking point and the one they scream about for any Rep proposed changes to healthcare, social security, welfare, taxes, etc, etc, etc.

    control-F 'Democrat' = "no matches found"

  • BestUsedCarSales||

    Try searching for "left"

  • Dillinger||

    >>>we are in a particularly intense moment of unreality

    "being alive"

  • JeffreyL||

    Johnathan Haidt has some really good work on this. I would recommend asking for his opinion on the "why" side of things in regards to what/why we hear what we hear and "feels"

  • Tony||

    Vote Libertarian 2020: Here, Have Some Vittles, Peasant.

  • LynchPin1477||

    Care to engage with any of the actual viewpoints being presented in the article or the comments?

  • Tony||

    Compare average income to GDP growth. My point is that inequality has increased since 1980, as was all part of the plan. We're told to be content with what scraps we're given by our betters, no matter how much overall wealth increases. Which is, after all, what libertarianism is all about.

  • Cynical Asshole||

    >LynchPin1477|10.1.18 @ 12:28PM|#

    Care to engage with any of the actual viewpoints being presented in the article or the comments?
    report spam

    Tony|10.1.18 @ 12:33PM|#

    Compare average income to GDP growth. My point is that inequality has increased since 1980, as was all part of the plan. We're told to be content with what scraps we're given by our betters, no matter how much overall wealth increases. Which is, after all, what libertarianism is all about. No.

    FTFY.

  • DarrenM||

    I think a lot of that is due to globalization.

  • vek||

    Uhhh, yeah. I would argue that most of it is due to globalization, with automation probably being the 2nd biggest factor.

    As labor markets become flooded, which is exactly what globalization did by making labor from the whole world available, it will obviously depress wages. Since everybody elses wages are far lower than ours, putting us in competition with them has that obvious outcome. As automation increases this will do this even more, because there will be less need even for this cheap labor.

    The most basic understanding of markets should tell people all of this.

  • LynchPin1477||

    See my comment above. Quantifying growth in wealth (or income) isn't straightforward, but a lot of the most widely cited numbers may very well be understating median income growth. Same is true for how you account for inflation in GDP.

    I was in the middle of looking at hard numbers but have to run to a meeting. Will try to update later. But food for thought.

  • ||

    Not that any of it has anything to do with strict or even loose libertarianism. Even from some of it's staunchest proponents, the safety net is only supposed to be used as... well... a safety net, not a floor. Get a group of the most left-leaning people you can find and ask them "Why not $75/hr.?" or "Why not just hand everyone $1M?" and you'll get long-winded discussions about the right amount of money to motivate people rather than just handing them $1M.

  • Qsl||

    Kinda.

    "Safety net" is vague, and it is better to pin people down on exactly what are they trying to accomplish.

    If it is to make certain no one starves to death and has shelter, that invokes certain types of solutions (and that is functionally a floor). If it is to allocate wealth in terms of a grand narrative, that invokes a different set of solutions. Add to that a degree of mendaciousness when people speak of the former but actually mean the latter.

    I mean you could structure EVERY business as a co-op (and have it collapse under its own bureaucratic weight) to address wealth inequality with less direct government intervention, but usually means their own wages falling, so that is a no go. You could have the top 1% exclusively, directly subsidize the bottom 10% to over 50% of the poverty line (effectively ending the worst of income inequality) with the understanding every one else pay an equal share of the remaining expenditure. They usually faint at their tax burden.

    Until there are specifics on what the actual goal is (and getting other voices in setting policy), it is just a nebulous mass of prescriptions with no clear purpose.

    And regardless, a "living wage" is the absolute worst way to address any notion of income equality.

  • ||

    As someone (actually, it was the commenter known as Sugarfree, who no longer inhabits these parts) once wrote something to the affect that a safety net is one thing, a safety hammock is another.

    I would love to claim that as my own, however my sense of Quaker honesty requires that I give appropriate credit.

  • ||

    I, too, am fine with a "safety net" though not with a "safety hammock".

    I tend to see libertarianism as an abstract ideal rather than an absolute condition.

  • vek||

    Ha, that's a good line! I'll have to remember that!

  • Gilbert Martin||

    GDP formula includes government spending.

    And government spending is nothing more than forced transfer payments that can never net to any value greater than zero.

    So GDP is not - and never has been - a valid metric of economic prosperity.

  • Gilbert Martin||

    GDP formula includes government spending.

    And government spending is nothing more than forced transfer payments that can never net to any value greater than zero.

    So GDP is not - and never has been - a valid metric of economic prosperity.

  • Sevo||

    Tony|10.1.18 @ 12:33PM|#
    "My point is that inequality has increased since 1980, as was all part of the plan. We're told to be content with what scraps we're given by our betters, no matter how much overall wealth increases. Which is, after all, what libertarianism is all about."
    What pile of horseshit.

  • LynchPin1477||

    OK, so the numbers I found for real median household income indicate about a 33% increase since 1960 (i.e., (x2-x1)/x1). Per capita GDP increased something more like 210%. Wow! That's a big discrepancy.

    I'm not entirely sure how to square the first number with the numbers I quoted above - they seem more or less in line with the number for household, post-tax, post-transfer, total compensation, but the website I got it from quotes it as "median real income". So I don't know if that is equivalent (having trouble getting to the definitions used in the census data) or if it is only looking at wages.

    As I mentioned above, there are also real questions about the best way to adjust for inflation.

    Nevertheless, I'll concede that it would be hard to bridge the gap in those numbers with definitional or statistical changes.

  • LynchPin1477||

    So, why might GDP be increasing so much more than income/compensation? Total government spending as a share of GDP has increased by something like 10 percentage points (a 40% increase), so to the extent that money was not doing anything to support income growth then it could be a factor. But since a lot of government spending is in the form of transfer payments I don't think that can explain much of it.

    Another explanation is that median household's productivity has not increased at the same rate as GDP and compensation is tracking that. That seems plausible to me.

    Another explanation is that large corporations/high income earners are able to exploit something in the current system that allows them to capture a larger fraction of GDP than you would guess from their productivity. That also seems plausible to me.

    Other possibilities abound.

  • LynchPin1477||

    So what's to be done? I'll preface this by saying that I don't really have a problem with inequality per se. I have a problem with people living in real poverty, and I have a problem with people who violate people's rights and use/abuse power to benefit themselves at the expense of others. So while I prefer non-coercive charity to the welfare state, as a practical matter I'm open to ways of improving the welfare state. I'm not a big fan of income guarantees for a whole host of reasons. But how do you feel about direct, means tested cash payments as a total replacement for existing welfare programs? I could get behind that. Vouchers aren't as good IMO but they'd probably be better than what we have now.

    I'm on the fence about retraining programs, but if you want to fund those I'd say they should at least be at the state level, not the federal. I *am* in favor of things that make it easier for people to work, though! We don't have to agree on all regulations to agree that regulatory capture is real and that it presents major hurdles to starting a new business and finding a new job. So let's get rid of those kinds of regulations and leave some of the other, more contentious ones to the side. And while we're at it, lets decriminalize drugs and a bunch of other stuff so that cycles of incarceration that contribute to chronic poverty among certain communities are at least reduced.

  • LynchPin1477||

    Zoning reform would do a lot to reduce housing costs in some areas. That's not a federal issue but we should talk about it. Getting rid of subsidies for employer-funded health care and replacing Medicare/Medicaid with cash payments or vouchers and maybe a publicly subsidized true catastrophic insurance program would free up the health care system and help increase competition and drive down costs, especially if paired with regulatory and licensing reform.

    On the corporate/big earner side of things, how about we totally revamp the tax code to eliminate all deductions, tax corporations on profits, and use a large individual standard deduction along with a flat rate of 18% at the federal level, or maybe something slightly progressive with a top individual/corporate rate somewhere around 22%? The exact percentages aren't super important but keep in mind that federal tax revenue hovers around 20% or so pretty much regardless of top marginal brackets. At a state and local level, how about some laws that prevent tax handouts as a means of trying to attract businesses.

  • LynchPin1477||

    Oh, and let's kick Wall Street to the curb as far as the relationship with the federal government and the federal reserve are concerned. The next time the banks fail let them fail and wall off tax payer money as much as legally possible (and let's start reducing public exposure right now).

    Phew, wow. That was an awful of time and typing for a heartless libertarian that wants, and has always wanted, poor people to fight among themselves for the scraps from the table.

  • Qsl||

    A more simplified approach would be UBI and land value tax. Reduce overhead while working within market mechanisms.

    There is a reason libertarian heretics keep returning to these.

  • LynchPin1477||

    An addendum on the off chance you come back to check this: I'm not willing to concede that all GDP gains (or however you choose to quantify gains in wealth) should track average income/compensation or be equally distributed among the whole population. People who create things of value deserve the benefits. I'm making an attempt to address concerns we both may have regarding people who don't actually create things that are valued by free people but who nevertheless benefit from positions of power and influence. I really am curious to see if you're willing to set aside other ideological differences in attempt to come to some agreement on how to address that issue.

  • vek||

    Not going to get into the other stuff, as there are a million reforms we need... But as far as those figures:

    Is it possible one isn't adjusted for inflation in the same way? That is one possibility.

    The other one that occurs to me, is capital expenditures. I know I have seen elsewhere, and one should assume this just from having a clue about the world, that capital expenditures per employee have gone up a lot.

    Keep in mind GDP is more or less gross money floating around/being spent or whatever. So if we're now spending 3 times as much cash (or whatever it takes to make the math jive) per employee on capital expenses, that simply leaves less for compensation, BUT the gross GDP being produced could be up considerably... It's just all being spent on robots, computers, facilities, etc.

  • ||

    Tony|10.1.18 @ 12:33PM

    In what way has inequality increased since 1980?

    How are you measuring this inequality?

    Are you measuring your position relative to your 'betters", ot to your "inferiors"?

    You know what? I personally am way better off than I was in 1980 and I have an income of half what I had six years ago when I retired.

    Equality is an entirely meaningless notion that only people like you who are concerned with how you stand with your betters and your inferiors are concerned with.

  • Earth Skeptic||

    Compare average income to actual human intelligence and utility, as in, what would most people be able to offer for money--sure seems like a lot of useless idiots. I am surprised income has not gone down.

  • Cynical Asshole||

    There's also little doubt that standards of living have improved dramatically over time. By virtually any measure, food today is better than it was in the past, and cheaper too. The same goes for virtually any consumer good, with exceptions for health care and education (which are both more expensive when adjusted for inflation) and, in some part of the country, housing as well.

    Health care, education, and housing. In other words, three areas of the economy that have a huge amount of government meddling. I'm sure it's just a coincidence...

  • MoreFreedom||

    Seems to me the real issues are:

    a) Government capturing more of the technological/productivity increases via increased taxation rather than individuals getting the benefit
    b) People getting rich via government picking of winners/losers in commerce via the administrative state rather than supporting free markets
    c) People in government getting rich at the expense of people in the private sector

    Sure standards of living have increased - which is what we'd expect from advances in science, technology and productivity. But how much better would be be if we didn't have to support more government and more redistribution?

  • Colossal Douchebag||

    It's almost as if complex data sets can be twisted, contorted and synthesized to support any partisan argument desired.

    And almost as if media outlets will do anything to attract eyeballs and sell advertising.

    Now, where's my crack pipe?

  • Vernon Depner||

    Beat that strawman flat, Nicky.

  • DarrenM||

    Envy is an ugly thing. It's like some people need to believe they are victims and the only reason someone else is doing better than they are is because they are cheating somehow.

  • Vernon Depner||

    But they ARE cheating. Most of us don't own any Congressmen and are not Too Big To Fail.

  • speedylee||

    We need more charts in our lives! https://youtu.be/NqGNMvOGQw8

  • Ron||

    income may be up but taxes and housing has outpaced the increase such that there is a net loss.

    anecdotal example. my divorced mother of three in the 70's was able to buy a house that only took up 1/7 of her bank teller salary and her taxed were a similar percentage. Today my taxes are one third of my pay and to buy a house would be a minimum of 50% of my income. Pay is up but our debt to our overlords has increased just like the old factory towns

  • I am the 0.000000013%||

    Why is income inequality bad?

    Knee repair and replacement was driven largely by the amazing salaries of NFL players.

    The 1%'ers who could afford the first Tesla's have given all of us a path to electric vehicles.

    If you believe in the goodness of foundations, most of those are due to the super rich.

    There are countless other examples.

    I really don't get people who prefer an equal share of pie over a bigger share of pie.

    I really really don't get people who want everyone to want a smaller piece of the pie.

  • Sevo||

    Additionally, it goes without saying that we're not all going to be Bill Gates, so that leveling is going to have to go the other way.
    No, thanks.

  • Hank Phillips||

    Good question.

  • Linux||

    The reason people focus on income inequality is the same reason that a child cries because another kid has a bigger piece of cake. Even though on average Americans have more material possessions, bigger houses, better technology, cheaper and more plentiful food, etc it doesn't matter because some other guy has a yacht.

  • Uncle Jay||

    We should all have equal income.
    If it worked in the Soviet Union, it'll work here.
    You just have to have faith in our ruling elites who are doing everything in their power to see this Marxist ideal becomes a reality.

  • Hank Phillips||

    I wonder if the Nixon Anti-Libertarian Campaign Subsidies Law of 1971 might have had something to do with the break in the graphs.

  • Kirk Solo||

    Its just a race to victimhood...like everything else.

  • TJJ2000||

    One thing I've found for sure -- If you zoom in to any income inequality graph to see the peeks and troughs and line them up with Party Line white house leadership -- Democrats have historically and repeatedly ALWAYS made income inequality skyrocket!

  • Architect of Liberty||

    Nick ends his rant by saying: "Trying to get a firm grasp on how people are actually doing is now even more urgent than it otherwise would be."


    What a moron -- it's not urgent. It's not even in my Top 20.

  • vek||

    I think there are 2 main things going on here:

    1. We judge ourselves RELATIVE to others. The fact that we now have 20% more people in the high bracket likely makes a lot of other people FEEL less well off. This actually plays into what I suspect for #2 also.

    2. Personally, I think there are more problems with the "big things" in life for a large portion of the population. Frankly, if you can't afford to buy a house, or have healthcare, you're REALLY not going to feel better about the fact that you have a nicer TV than you parents had in the 80s or an iPhone. Even if you passed on all those things, you still wouldn't have enough for the house. The "big" things in life are incidentally the ones that have become far more expensive after inflation.

    With housing, other than zoning crap/FedGov policy, I think there are a couple reasons here. One is that those 20% of people now making more can in fact push up housing prices, especially in nice places, so that those still left in the middle or lower brackets have no shot at buying. Additionally houses have become bigger on average, because of those 20% are making more money and want a nicer pad. The other is that more people are crammed into the most expensive areas of the country compared to 40 years ago, which obviously drives prices up more.

  • vek||

    So while we may be better off on paper across the board, I think the fact that people can't take care of the big things in life contributes to the feeling of being worse off. This is no reason to become a commie, but we probably should push for free market solutions/deregulation that will fix the problems in these key areas if we want people to be less angsty.

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