Wednesday, December 11, 2019
Washington Post, The Massive Triumph of the Rich, Illustrated By Stunning New Data:
The triumph of the rich, which is one of the defining stories of our time, is generally described as largely the reflection of two factors. The first, of course, is the explosion of income among top earners, in which a tiny minority has vacuumed up a ballooning share of the gains from the past few decades of economic growth.
The second factor — which will be key to the 2020 presidential race — has been the hidden decline in the progressivity of the tax code at the top, in which the wealthiest earners have over those same decades seen their effective tax rates steadily fall.
Put those two factors together, and they tell a story about soaring U.S. inequality that is in some ways even more dramatic than each is on its own.
A new analysis prepared at my request by Gabriel Zucman — the French economist and "wealth detector" who has become famous for tracing the hidden wealth of the super-rich — illustrates that dual story in a freshly compelling way.
The top-line finding: Among the bottom 50 percent of earners, average real annual income even after taxes and transfers has edged up a meager $8,000 since 1970, rising from just over $19,000 to just over $27,000 in 2018.
By contrast, among the top 1 percent of earners, average income even after taxes and transfers has tripled since 1970, rising by more than $800,000, from just over $300,000 to over $1 million in 2018.