Who still believes the rich are getting richer and the poor are getting poorer?

Question

Anyone who follows the media has probably heard many times that the rich are getting richer, the poor are getting poorer, and incomes of the population in general are stagnating. Moreover, those who say such things can produce many statistics, including data from the Census Bureau, which seem to indicate that.

On the other hand, income-tax data recently released by the Internal Revenue Service seem to show the exact opposite: People in the bottom fifth of income-tax filers in 1996 had their incomes increase by 91 percent by 2005.

The top one percent — “the rich” who are supposed to be monopolizing the money, according to the left — saw their incomes decline by a whopping 26 percent.

Meanwhile, the average taxpayers’ real income increased by 24 percent between 1996 and 2005.

How can all this be? How can official statistics from different agencies of the same government — the Census Bureau and the IRS — lead to such radically different conclusions?

There are wild cards in such data that need to be kept in mind when you hear income statistics thrown around — especially when they are thrown around by people who are trying to prove something for political purposes.

One of these wild cards is that most Americans do not stay in the same income brackets throughout their lives. Millions of people move from one bracket to another in just a few years.

What that means statistically is that comparing the top income bracket with the bottom income bracket over a period of years tells you nothing about what is happening to the actual flesh-and-blood human beings who are moving between brackets during those years.

That is why the IRS data, which are for people 25 years old and older, and which follow the same individuals over time, find those in the bottom 20 percent of income-tax filers almost doubling their income in a decade. That is why they are no longer in the same bracket.

That is also why the share of income going to the bottom 20 percent bracket can be going down, as the Census Bureau data show, while the income going to the people who began the decade in that bracket is going up by large amounts.
Unfortunately, most income statistics, including those from the Census Bureau, do not follow individuals over time. The Internal Revenue Service does that and so does a study at the University of Michigan, but they are the exceptions rather than the rule.

Following trends among income brackets over the years creates the illusion of following people over time. But the only way to follow people is to follow people.

Another wild card in income statistics is that many such statistics are about households or families — whose sizes vary over time, vary between one racial or ethnic group and another, and vary between one income bracket and another.

That is why household or family income can remain virtually unchanged for decades while per capita income is going up by very large amounts. The number of people per household and per family is declining.

Differences in the number of people per household from one ethnic group to another is why Hispanics have higher household incomes than blacks, while blacks have higher individual incomes than Hispanics.

Considering the millions of dollars being paid to each of the anchors who broadcast network news, surely these networks can afford to hire a few statisticians to check the statistics being thrown around, before these numbers are broadcast across the land as facts on which we are supposed to base policies and elect presidents.

Now that the Internal Revenue data show the opposite of what the media and the politicians have been saying for years, should we expect either to change? Not bloody likely.

The University of Michigan study, which has been going on for decades, shows patterns very similar to those of the IRS data. Those patterns have been ignored for decades.

Too many in the media and in politics choose whatever statistics fit their preconceptions.

Answer 1

The income gap is indeed widening in the United States, but any sort of data chosen. The gap has widened in recent decades. This is shown through various scales. The Gini index, for one, has increased from 40 to 46 in the last 30 years. No significant, but true. Other scales show a wider disparity.

Answer 2

The majority of rich people inherited their wealth. There is a group that got ahead due to the ability of their family to send them to the right schools and set them up in business, even though they were not super-wealthy. People like this usually take full credit for their own success, as though they graduated from high school living in a car and earned their way through Princeton mowing lawns. Rich businesspeople get ahead by maximizing profit. More and more often nowadays they pay their employees as little as they can get away with and provide no benefits. Why, if those people deserved health insurance, they'd have been born wealthy, wouldn't they? The number of people in the US who have gone from extreme poverty to extreme wealth is smaller than in any other country, including the ever-vilified "socialist" ones. Of course, we can't ignore the fact that one reason the rich get richer and the poor get poorer is because the rich have paid off the government to redistribute wealth from the poor directly to them. ∠°)

Answer 3

The rich are getting richer (The top 1% own 90% of the income and the bottom 50% own 1%, does anyone else see a problem with this?)

Answer 4

Lies ,bigger lies and damn statistics.When people cannot afford their homes on both sides of the atlantic and are spending up to 50% of their income on rent or mortgages
people are not getting better off ,The unbelievable amount of money that Ceos and managing directors pay themselves at
the cost to others is disgustinng and pieces of filth like you should have that report rammed down his throat..

Then I realise you were probably winding people up .
Good joke, the laugh is on us .

Answer 5

the answer is Yes...the Rich make it as hard as possible to compete with them...and the IRS does too.....
...case in point Billions may pay 3% tax when I make 40,000 a year and pay 28%....
.....the tax benifits should be for everyone...since there is such an inequitey. ....the flat tax that gives back checks for necessarities is the only anser...
....drug dealers will pay tax
...prototutes willl pay..
..Illegals will payl....
..............and guess what Billionaires, Millionaires will pay. "TOO"...now that is a surprising factor!

Answer 6

Me. Just cause guys like Warren Buffet say the same thing. But he doesn't include a dissertation in his questions like you. Ask a question, don't post a dam essay.

Answer 7

No one who is informed believes that.
In fact, it's never been true throughout history.

Since Bush's Tax Cuts, I have now moved from lower class to middle class.
Since Bush, many middle class have moved up to upper class.

The whiners are still on Welfare and haven't moved anywhere.

If you want to get richer, GET A JOB.
That always helps.

Answer 8

Look....you, me, and anybody with an IQ above single digits know that "the rich keep getting richer" is just another excuse for the left to remain lazy, unmotivated, and incompetent. They use this excuse as reason for why their lives are completely empty. Everybody knows that if you set goals, work hard to achieve them, that anybody...even the lazy left, can become "rich". The problem is that most libs define "rich" as anybody who has more than themselves..and that just won't cut it in reality.

Answer 9

Just walk around and ask people and you'll find out that your statistics are meaningless propaganda flak to cover up a big problem.

Go ahead, just ask, especially the middle class---ask them if they are better off than in 1997.

Go ahead, do it and tell us what you hear (honestly I mean, which doesn't seem to be your forte up to now).

Answer 10

a question like this without involving a real data comparsim is useless...if you can't give a reputable source your info is suspect....it's like saying "my car gets 300 miles a gallon. wanna buy it?"