I have written over the years about the way in which a lot of government statistics tell us very little about how real people are doing in the economy. To wit: some talking heads and political leaders keep talking talking about a “recovery”. But, that means very little to most people — except, surprise, if you are rich.
I meant to write about this sad fact a few days ago:
Incomes rose more than 11 percent for the top 1 percent of earners during the economic recovery, but not at all for everybody else, according to new data.
The numbers, produced by Emmanuel Saez, an economist at the University of California, Berkeley, show overall income growing by just 1.7 percent over the period. But there was a wide gap between the top 1 percent, whose earnings rose by 11.2 percent, and the other 99 percent, whose earnings declined by 0.4 percent.
Mr. Saez, a winner of the John Bates Clark Medal, an economic laurel considered second only to the Nobel, concluded that “the Great Recession has only depressed top income shares temporarily and will not undo any of the dramatic increase in top income shares that has taken place since the 1970s.”
It’s actually not a surprise. Income for the rich comes mostly from investments so when you have a rise in the stock market the rich do well. Everyone else depends on a weekly basic paycheck — and that is going nowhere. Which makes the president’s meek proposal on raising the minimum wage even more pathetic.