An interesting look at wealth
From
The Austrian Economists:
More Evidence That We're All Getting Richer
While looking for something else, I stumbled across this Census report on household income from 2006. What's really interesting is to look at the percentage of households in each income category and how that's changed over time. If the prophets of doom and decline and rising inequality are right, we would expect to see, I'd think, lots more rich households and lots more poor ones as the supposed gap widens. Some prophets of doom might expect to see fewer households in the upper brackets as the highest income categories are dominated by a few people getting very, very rich.
The reality, as it turns out, is different. From 1980 to 2006, the percentage of US households earning $100,000 or more (in constant 2006 dollars) grew from 8.6% to 19.1%. The percentage between $75k and $100K grew from 10.3 to 11.3 percent. At the other end, the percentage under $15K fell from 16.6% to 13.4% and the percentage between $15K and $34K fell from 26.2% to 23.3%. Thus all three categories below $35K fell a total of 6.1 percentage points.
The middle classes fell too, though by less. The sum total across the $35K to $75K categories fell by 5.4 percentage points. In other words: the net movement of households was an 11.5 percentage point gain in households above $75K and a net reduction of 11.5 percentage points in houses below $75K. So the percentage above $75K rose from 18.9% to 30.4%. That is, it increased by over 50%.
Let me repeat that: over 30% of US households in 2006 earned above $75K compared to under 20% in 1980. Over the same period, the percentage of US households earning under $35K fell from 42.8% to 36.7%. Fewer households are poor, fewer are middle class, and a hunk more are above $75K. (And in case you were wondering, those general trends hold for black and hispanic households too - with the percentage of black households under $35K falling by 10.9 percentage points and the number above $75K increasing by 8.9 percentage points, for example.)
Throw on top of this the fact that most everything people buy costs less in real terms and you have a recipe for increasing wealth across the board. Not bad for what so many people claim is 30 years of stagnation.
Very true -- people that consider themselves to be poor now have television sets, cell phones and cars. The rising tide floats all boats.
The Socialist/Marxist idea that there is a fixed pool of money and that social inequities stem from that pool not being
spread around enough is a pure unadulterated joke and it serves to show just how out of touch with reality these people are.
Posted by DaveH at August 23, 2009 3:43 PM