Ezra Klein gives us two graphs. The first compares median household income to the wealthiest Americans’ share of income over the last 60 years; the second shows us income gains since 1947 — the gain for the top 1% compared with the median income gain.
I won’t attempt to describe or characterize his entire analysis, but two specific conclusions he drew jumped out for me:
- There is no correlation between income inequality and income stagnation: “There’s not much evidence here for the view that the top 1% are taking income gains that would’ve gone to the rest of us, or at least for the view that that’s the primary driver of median income stagnation.”
- “There’s almost no relationship between the fortunes of the richest Americans and average Americans. … There’s a model of the economy in which the rich create the growth that sustains everyone else — this is the model in which low tax rates on the wealthy are a crucial component of long-term economic growth — but I see no evidence in either graph that that’s how the economy actually works.”