CBO Report Shows Rich Got Richer, As Did Most Americans
Some highlights from this (surprisingly) objective editorial:
The skyrocketing earnings of the very wealthiest get the headlines, but the vast middle of U.S. workers didn’t do too badly either over the study period: the 21st through 80th percentiles saw their inflation-adjusted incomes rise about 40 percent, and even the very poorest 20 percent had an 18 percent increase in real dollars. Mean household income, not including government transfers, rose by 62 percent; median income by 35 percent. (Many other studies have shown a slowing of middle- class earnings growth over the last decade; the CBO report doesn’t cover the years since the economic crisis of 2008.)
The data do much to contradict claims that America has become a permanently stratified society. A Treasury Department report on income mobility found that half the taxpayers in the bottom 20 percent in 1996 moved to a higher bracket by 2005. As one moves through life, one moves through earnings groups: 74 percent of people in the top 20 percent of households are in their peak earnings years, between ages 35 and 64; fewer than half the people in households in the bottom 40 percent are.
In sum, the vast increase in the wage gap may not be fair or good, but it isn’t arbitrary. And it’s certainly not a conspiracy of the so-called 1 percent.
The CBO report is a far more complicated and promising document than the conventional wisdom holds. Americans did move apart -- but it’s worth remembering that most of us moved up, too.