Inequality Made Simple

[Soggy in NOLA]

Well, time to catch some of the drunken shenanigans known as Mardi Gras.

 

[westwall]

The reason people are in debt is because they have decided to live beyond their means.

Another Reason People Are in Debt

Do you remember receiving "pre-approved" credit card solicitations in your mailbox?

Seen any lately?

As the richest 1% of Americans increased their share of national income over the last 30 years, middle class incomes suffered in two ways. First by tax policies that favored shipping middle class jobs out of the country, and secondly, by tax cuts for the wealthy and other tax biases that favored debt over equity investing.

Using other people's money for investments and assuming an implicit guarantee from government to backstop any loses with taxpayer bailouts SUCKED about two percentage points of national income from the bottom quintiles (middle class) and redirected the money to the richest 1%.

Those in the middle classes who lost their previous share of national income maintained their standard of living by using credit cards, and I'm sure we both remember how that turned out and which 1% of the US population profited.

A Simple Look...

Yea, I used to get a lot of those 'pre approved' circulars. I threw them in the trash, because I'm smart enough not to borrow what I can't pay back. If you were stupid enough to take credit out that you cannot afford to repay, that's not my problem.

And that is a simple truth. Something the socialists hate. People make bad decisions all the time. Wealthy people make fewer of them, that's why they are wealthy. I also love the claim that they steal from the poor. Where exactly are they holding a gun to someones head and taking their money from them? That is what the IRS does with our money that they confiscate to give to lazy bums like georgie here.

Madoff didn't rip off the poor, he ripped off the wealthy. People who can work, but choose not to on the other hand, they steal from everybody all the time.

 

[westwall]

http://www.cbo.gov/publications/collections/tax/2010/average_after-tax_income.pdf

Every quintile is doing better.in terms of actual after tax income adjusted for inflation.

And 1% is doing MUCH better at increasing its percentage of national income.

"Since it (see graph) shows income shares, inflation measures don't matter. It doesn't try to measure consumption, it just measures who the money is going to. It includes pensions and government transfers. It accounts for reporting changes due to the 1986 tax reform bill. And it uses tax data to get a cleaner look at the top of the income distribution...

"If you look at the raw CBO figures, they show that a full tenth of the national income has shifted since 1979 to the top 1% of the country.

"The bottom quintiles have each given up a bit more than two percentage points each, and that adds up to 10% of all earnings.

"That 10% has flowed almost entirely to the very tippy top of the income ladder."

Maybe it depends on the definition of "doing better"?

Envy is not a good basis for policy.

When after tax income adjusted for inflation increases, that mean there is more money to spend improving lives. If you have $10,000 one day and $20,000 the next day are you worse off just because someone who previously had $1 Million now has $10 Million?

Conversely, if you have $10,000 one day and $10,001 the next day are you better off because someone who previously had $1 Million now has $100,000?

georgie is not envious, envy is a positive motivator. It makes you work harder so you can have what you see others have. No, georgie suffers from jeolousy because he wants what others have he's just too lazy or stupid to earn them. So he wants the government to take from those who work 60-80 hour weeks so they can give it to him while he lurks in moms basement and rails at the world.

 

[georgephillip]

Observations:

The author is criticizing this bit of research:

The rise in American inequality has been exaggerated both in magnitude and timing. Commentators lament the large gap between the growth rates of real median household income and of private sector productivity. This paper shows that a conceptually consistent measure of this growth gap over 1979 to 2007 is only one-tenth of the conventional measure. Further, the timing of the rise of inequality is often misunderstood. By some measures inequality stopped growing after 2000 and by others inequality has not grown since 1993. This cessation of inequality’s secular rise in 2000 is evident from the growth of Census mean vs. median income, and in the income share of the top one percent of the income distribution. The income share of the 91st to 95th percentile has not increased since 1983, and the income ratio of the 90th to 10th percentile has barely increased since 1986. Further, despite a transient decline in labor’s income share in 2000-06, by mid-2009 labor’s share had returned virtually to the same value as in 1983, 1991, and 2001.

Recent contributions in the inequality literature have raised questions about previous research on skill-biased technical change and the managerial power of CEOs. Directly supporting our theme of prior exaggeration of the rise of inequality is new research showing that price indexes for the poor rise more slowly than for the rich, causing most empirical measures of inequality to overstate the growth of real income of the rich vs. the poor. Further, as much as two-thirds of the post-1980 increase in the college wage premium disappears when allowance is made for the faster rise in the cost of living in cities where the college educated congregate and for the lower quality of housing in those cities. A continuing tendency for life expectancy to increase faster among the rich than among the poor reflects the joint impact of education on both economic and health outcomes, some of which are driven by the behavioral choices of the less educated.


Misperceptions About the Magnitude and Timing of Changes in American Income Inequality


And yet the MJ moonbat has to resort to the typical static pie chart to try to assert growing inequality.

I doubt that the value of things which are not included for income tax purposes (health benefits, pension benfits etc.) of the growing public employee union class are incorporated into his income allocations.

MJ Moonbat responds

"There's long been a cottage industry in efforts to show that income inequality isn't as bad as the raw numbers say it is. Until recently, the most popular tactic was to insist that we should look at consumption instead of income.

"This was mostly just an attempt at misdirection, but in any case the great credit bubble and bust has made it plain that a lot of recent middle class consumption was fueled by refi and charge card binges that ended disastrously.

"If anything, this strengthens the case of those who say that income matters after all, so we don't hear this argument much anymore.

"But there are plenty of others. We're measuring inflation wrong. Cheap plasma TVs and Chicken McNuggets have made the life of the poor better than you'd think by just looking at their earnings.

"The whole thing is just a statistical artifact of the 1986 tax reform bill.

"The composition of households has changed, so household income goes farther than it used to. Income distribution looks better if you count government transfers. Etc. etc. etc."

So the question becomes: "Does income matter?"

If the average household contains 2.6 members today where it used to hold 2.7 or if big screen plasma TVs and Chicken McNuggets are cheaper for the poor and middle classes to buy, doesn't change the fact that one full tenth of national income has shifted since 1979.

To the top 1% of US households in general and the top 0.01% in particular.

Moonbat again:

"This income shift is real. We can debate its effects all day long, but it's real.

"The super rich have a much bigger piece of the pie than they used to, and that means a smaller piece of the pie for all the rest of us.

"You can decide for yourself if you think this is something we should just shrug our shoulders about and accept."

A Simple Look...

 

[georgephillip]

The reason people are in debt is because they have decided to live beyond their means.

Another Reason People Are in Debt

Do you remember receiving "pre-approved" credit card solicitations in your mailbox?

Seen any lately?

As the richest 1% of Americans increased their share of national income over the last 30 years, middle class incomes suffered in two ways. First by tax policies that favored shipping middle class jobs out of the country, and secondly, by tax cuts for the wealthy and other tax biases that favored debt over equity investing.

Using other people's money for investments and assuming an implicit guarantee from government to backstop any loses with taxpayer bailouts SUCKED about two percentage points of national income from the bottom quintiles (middle class) and redirected the money to the richest 1%.

Those in the middle classes who lost their previous share of national income maintained their standard of living by using credit cards, and I'm sure we both remember how that turned out and which 1% of the US population profited.

A Simple Look...

Yea, I used to get a lot of those 'pre approved' circulars. I threw them in the trash, because I'm smart enough not to borrow what I can't pay back. If you were stupid enough to take credit out that you cannot afford to repay, that's not my problem.

I did the same thing with the circulars I received every week.

Assuming I don't lose my job due to cuts in the state budget, I will be debt free by next fall.

War slaves and debt slaves.
Some things have never changed.
Yet.

 

[georgephillip]

And I'll add that nobody forced the holders of said credit cards to max them out buying big screen TVs and other crap they didn't actually need.

Depending upon your definition... "(A)nything that is able to make a big change in a person or thing."

Would you say Advertising functions like a force in this country?

 

[DiamondDave]

Yeah... all the hidden control signals in the advertising that take away your free will and ability to make your own decisions

 

[Avatar4321]

And I'll add that nobody forced the holders of said credit cards to max them out buying big screen TVs and other crap they didn't actually need.

Depending upon your definition... "(A)nything that is able to make a big change in a person or thing."

Would you say Advertising functions like a force in this country?

You are honestly trying to claim we have no choice but to obey advertising?

I must be superhuman then. I've resisted all advertisements encouraging me drink, use feminine hygene products, and buy the cars advertised on TV. Not to mention I've resisted voting for Democrats.

 

[Avatar4321]

Yeah... all the hidden control signals in the advertising that take away your free will and ability to make your own decisions

Amazing isn't it? I can't imagine how depressing it is to delude yourself into thinking that you aren't responsible for any of your actions.

 

[DiamondDave]

Yeah... all the hidden control signals in the advertising that take away your free will and ability to make your own decisions

Amazing isn't it? I can't imagine how depressing it is to delude yourself into thinking that you aren't responsible for any of your actions.

It's the far left mentality... government to think and act for you and your responsibilities

 

[Avatar4321]

It's the far left mentality... government to think and act for you and your responsibilities

I know. and unfortunately, that's the mentality of some people on the right too. But it must be so miserable. I can't imagine having to exert so much effort to lie to yourself and avoid taking responsibility for your own actions. I can't imagine how miserable it would be to convince yourself that your choices dont matter and that the only reason you are unhappy is because of other people.

It makes me feel so sad for such people.

 

[georgephillip]

http://www.cbo.gov/publications/collections/tax/2010/average_after-tax_income.pdf

Every quintile is doing better.in terms of actual after tax income adjusted for inflation.

And 1% is doing MUCH better at increasing its percentage of national income.

"Since it (see graph) shows income shares, inflation measures don't matter. It doesn't try to measure consumption, it just measures who the money is going to. It includes pensions and government transfers. It accounts for reporting changes due to the 1986 tax reform bill. And it uses tax data to get a cleaner look at the top of the income distribution...

"If you look at the raw CBO figures, they show that a full tenth of the national income has shifted since 1979 to the top 1% of the country.

"The bottom quintiles have each given up a bit more than two percentage points each, and that adds up to 10% of all earnings.

"That 10% has flowed almost entirely to the very tippy top of the income ladder."

Maybe it depends on the definition of "doing better"?

Envy is not a good basis for policy.

When after tax income adjusted for inflation increases, that mean there is more money to spend improving lives. If you have $10,000 one day and $20,000 the next day are you worse off just because someone who previously had $1 Million now has $10 Million?

Conversely, if you have $10,000 one day and $10,001 the next day are you better off because someone who previously had $1 Million now has $100,000?

If you had $15,300 one day in 1979 and $17,700 one day twenty-eight years later AFTER the US Economy doubled are you worse off than your millionaire neighbor who had $346,600 in '79 and now "earns" $1,319,700?

A Simple Look At Income Inequality | Mother Jones

 

[asterism]

And 1% is doing MUCH better at increasing its percentage of national income.

"Since it (see graph) shows income shares, inflation measures don't matter. It doesn't try to measure consumption, it just measures who the money is going to. It includes pensions and government transfers. It accounts for reporting changes due to the 1986 tax reform bill. And it uses tax data to get a cleaner look at the top of the income distribution...

"If you look at the raw CBO figures, they show that a full tenth of the national income has shifted since 1979 to the top 1% of the country.

"The bottom quintiles have each given up a bit more than two percentage points each, and that adds up to 10% of all earnings.

"That 10% has flowed almost entirely to the very tippy top of the income ladder."

Maybe it depends on the definition of "doing better"?

Envy is not a good basis for policy.

When after tax income adjusted for inflation increases, that mean there is more money to spend improving lives. If you have $10,000 one day and $20,000 the next day are you worse off just because someone who previously had $1 Million now has $10 Million?

Conversely, if you have $10,000 one day and $10,001 the next day are you better off because someone who previously had $1 Million now has $100,000?

If you had $15,300 one day in 1979 and $17,700 one day twenty-eight years later AFTER the US Economy doubled are you worse off than your millionaire neighbor who had $346,600 in '79 and now "earns" $1,319,700?

A Simple Look At Income Inequality | Mother Jones

How is anyone worse off? They all get paid more money.

 

[editec]

See how they run like pigs from a gun see how they fly.

George, you can't teach pigs to sing.

The facts are all there for their benefit.

They are choosing not to acknowledge them.

I see this "LA LA LA I'm not listening" behavior from right wing idelogues on every site I post at.

Their superpower is their absolute delight in being ignorant.


We are at another one of those American KNOW NOTHING periods where the terminally stupid have been recruited for political purposes.

This too will pass, I suppose.

 

[georgephillip]

ed...

Chris Hedges isn't so sure it will pass this time:

"The poor can dine out only so long on illusions.

"Once they grasp that they have been betrayed, once they match the bleak reality of their future with the fantasies they are fed, once their homes are foreclosed and they realize that the jobs they lost are never coming back, they will react with a fury and vengeance that will snuff out the remains of our anemic democracy and usher in a new dark age. "

 

[ClosedCaption]

Where, in the Constitution, does it state that everyone is always going to be equal?

What do you mean by equal?

I'm using the word to indicate "a government that would guarantee equally to all individuals the rule of law and security for liberty under the law."

You poor people are getting very whiny these days. Just sayin'.

Equal doesn't mean you get to take other people's money. Move the fuck on. Work.

Why does the rich get more and more of the middle classes money and they middle class gets accused of wanting the riches money? The middle class wants the money, ok, shame on them. The rich actually gets it and thats how it should be...?

Working doesnt mean anything, as if working is the solution to receiving tax breaks.

And no one here is rich so, I'm really not understanding why ppl that dont have the money are so defensive of those that do? This heroification of rich people is really weird. Rich people have fanboys but I dont know why

 

[boedicca]

And I'll add that nobody forced the holders of said credit cards to max them out buying big screen TVs and other crap they didn't actually need.

Depending upon your definition... "(A)nything that is able to make a big change in a person or thing."

Would you say Advertising functions like a force in this country?

Advertising is an influence, a form of persuasion. One is neither obligated nor forced to respond to it.

 

[asterism]

What do you mean by equal?

I'm using the word to indicate "a government that would guarantee equally to all individuals the rule of law and security for liberty under the law."

You poor people are getting very whiny these days. Just sayin'.

Equal doesn't mean you get to take other people's money. Move the fuck on. Work.

Why does the rich get more and more of the middle classes money and they middle class gets accused of wanting the riches money? The middle class wants the money, ok, shame on them. The rich actually gets it and thats how it should be...?

Working doesnt mean anything, as if working is the solution to receiving tax breaks.

And no one here is rich so, I'm really not understanding why ppl that dont have the money are so defensive of those that do? This heroification of rich people is really weird. Rich people have fanboys but I dont know why

I used to work for a rich man. I never met a more kind and generous person in my life. He liked my attitude, work ethic and while demanding results, gave the the tools to deliver them. He inspired me to be like him in many ways.

My daughter got very sick last summer. It wasn't an issue of money, but it was an issue of getting access to the right people to take a second look. When another very rich person heard about our situation, he sent me a message telling me he would do "anything to help." I have never met this person but he knew of me and my family through mutual friends. I asked if he could find a pediatric infectious disease specialist to call our family physician and look at the information. Within minutes the nursing staff around my daughter was buzzing because someone from the CDC was calling.

I don't think either of these people made their money at the expense of anyone else, they were simply better than their other rich competitors. Both of them will die relatively poor and are currently in the process of giving all of their money away.

 

[georgephillip]

Envy is not a good basis for policy.

When after tax income adjusted for inflation increases, that mean there is more money to spend improving lives. If you have $10,000 one day and $20,000 the next day are you worse off just because someone who previously had $1 Million now has $10 Million?

Conversely, if you have $10,000 one day and $10,001 the next day are you better off because someone who previously had $1 Million now has $100,000?

If you had $15,300 one day in 1979 and $17,700 one day twenty-eight years later AFTER the US Economy doubled are you worse off than your millionaire neighbor who had $346,600 in '79 and now "earns" $1,319,700?

A Simple Look At Income Inequality | Mother Jones

How is anyone worse off? They all get paid more money.

Possibly the answer lies in defining "they."

Both your source and mine use "they" as "households" instead of individuals.

In 1979 most middle class households existed on a single income source. That often wasn't even possible in 2007.

Wouldn't the cost of childcare have to be factored into $2400 "income increase" the lowest quintile saw during those 38 years?

 

[asterism]

If you had $15,300 one day in 1979 and $17,700 one day twenty-eight years later AFTER the US Economy doubled are you worse off than your millionaire neighbor who had $346,600 in '79 and now "earns" $1,319,700?

A Simple Look At Income Inequality | Mother Jones

How is anyone worse off? They all get paid more money.

Possibly the answer lies in defining "they."

Both your source and mine use "they" as "households" instead of individuals.

True, but that is also a problem since a college student with a summer job that lives at home or a mom with a part time job while the kids are at school can skew the results.

Here's average compensation by worker per hour:

And the hours worked:

Minimum wage has exceeded inflation in my working life. I made $3.33 per hour in 1985. That's equivalent to $6.55 in 2009 while the federal minimum wage was $7.25.

In 1979 most middle class households existed on a single income source.

I'd like some factual basis for that, some actual data. Not mother Jones skewed graphs, but actual data.

That often wasn't even possible in 2007.

That's simply not true. Life is all about priorities.

Wouldn't the cost of childcare have to be factored into $2400 "income increase" the lowest quintile saw during those 38 years?

Only if you assume every one of those households used childcare that they had to pay for.