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Friday, May 30, 2003



A Bit Of Data From (And For) The CalPundit

The CalPundit seems to have re-triggered a debate about income inequality. He sends us to a fascinating Census Bureau table showing income distributions over time. I want to relate this data to Kevin's follow-up post, which tells us that:

Although I'm in favor of government programs that help the needy, my real concern when I talk about growing income inequality is the middle class. My reading of history tells me that a growing and thriving middle class is essential to democracy and to a flourishing economy. Both suffer if the middle class stagnates for too long, and that's what's been happening for the past 20 years.

OK, I apologize for my deplorable HTML skills. I am excerpting from the chart titled "Table A-1. Households by Total Money Income, Race, and Hispanic Origin of Householder: 1967 to 2001", which is on p. 21 of the .pdf file (p. 15 of.the report). For a starting point I am using 1981, which seems to be the preferred baseline, since for at least some liberals it represents the ascension of Ronald Reagan and the Descent into Darkness. The data is titled "Income in 2001 CPI-U-RS adjusted dollars. Households as of March of the following year. For meaning of symbols, see text", so we seem to have inflation adjusted data. Here we go:

Percent of Households in each income category

Income
....................................... 1981.......... 2001
Under $5,000.....................3.2%..........3.1%
$5 K to $10 K.....................8.7.............5.9
$10K to $15K.....................8.1.............6.9
$15K to $25 K..................15.8...........13.3
$25 K to $35 K.................13.6...........12.4
$35 K to $50 K.................18.1...........15.4
$50 K to $75 K.................19.1...........18.4
$75 K to $100 K.................7.8...........10.8
Over $100 K.......................5.5...........13.8

Median Income.............$35,478.......$42,228 (a 19% increase)

Hmm, I'm so busy typing I lost sight of the crisis. Oh, yes, it is the disappearance and stagnation of the middle class. It appears from this chart that, over the last twenty years the ranks of the deeply poor have shrunk, and the middle class has drifted into the "Above 100 K" category. An additional 8.3% of households fill this category, with offsetting drops at the lower income threshholds.

As I said, I am having trouble keeping sight of the crisis.

UPDATE: Daniel Drezner has a comprehensive reply.


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