

Income concentration

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And this trend was to a large degree caused by the worst preisdent America has ever seen, namely Ronald Reagan.


Assuming that the figures are accurate two important things can be drawn from the report, first) I guess this is the land of opportunity so let's try our best not to ruin it. Second, keep in mind that the numbers do not indicate the improved quality of life for most and also there is no indication of income mobility which is critically important. I suspect that the makeup of the 1% is constantly changing so you too with enough brain power and initiative can enter the 1%.


Since the figures include capital gains (i.e.: declared investment returns), I presume the next couple of decades will look very similar to 1930-1950.


Too much power in the hands of 1%. How many people lost their job because the top 1% were using the financial system as their personal playground?

@Wilfred knight: the top 1% aren't necessarily creating anything. They used their wealth to influence the Bush administration to loosen banking regulation so they could "create more wealth".

They got cocky and nearly destroyed the financial system. The times when the disparity wasn't so high were also very good economic times.

A strong economy needs a strong middle class. Not a Strong "top 1%".

Left of Che

@Wilfred Knight,

If you are old enough to read the Economist, then you are too old to believe in Santa Claus, the Tooth Fairy, and meritocratic wealth accumulation.


wilfred knight:

You say:

Who are these people you are talking about that created wealth? Investment bankers? Enron Management?


Wealth is not always created. Sometimes it is amassed by monopolistic practices, manipulation of the financial markets, rules that allow the weak sorts to pay loans at high interest rates. One might suggest that the lowering of the income of the middle class could be due to the outsourcing of good paying jobs to China and other such countries. All of those practices will enrich the wealthy at the expense of the middle class. This is not the sort of trend that is a benefit to society. At some point this position will unwind as surely as the bank lending crisis did. It will be interesting to see how that ends up.


The key word here is "earned". Work hard and with some self-discipline, you can amass quite a fortune. For example, we have three cars in my family and they average 11 years old. They are not fancy but they achieve the goal of safe transportation. Will you make the top 1%? Not likely but even the top 20% is a nice place to land. Spend your time whining about other peoples' "share" and you will remain in the lower 20%.


Interestingly, if you plot the 20/80 rule, this sort of fits.

@bampbs: Their share? This is capitalism, there is no "share". Do you have a better system? How about your system where you increase income tax? Now either you're a genius and no-one's ever thought of that before, or it's been tried and failed. See if you can guess which is the case. I'll give you a clue: "all the rich people leave and take their money with them".


This must be pre-tax income and it is (as said so) 2007 data. What strikingly interesting (and intriquing) is the last peak (~25%) happened in 1927, two years before 1929... Here to hope the curve repeats itself.


Disgusting, isn't it ? How did the top 1% ever get by with only 10 times their share ? How is it that anyone talented ever took a risk, or even took a job ? Has anyone ever suggested to a knee-jerk tax-slasher that people are not motivated only, or even primarily, by money ? When greed was pointless because of confiscatory marginal tax rates, people had to make do with the satisfaction and respect that come with accomplishment, along with an ample but not obscene income. What a bunch of suckers, right ?

I think it is time, not only for much higher marginal tax rates, but for a capital levy (this can be handled with estate or inheritance taxes). Extremely large concentrations of wealth are a danger to the Republic. Comfort wealth is one thing; power wealth is quite another.


Those poor bastards in the top 1%, how do they ever make do in Socialist America with her astronomic tax rates?


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