In terms on income equality, in terms of middle class buying power, etc.
Income inequality isn't desirable, but what if purchase power of the lowest class rose over that same period. The rich got richer, yes, but the poor got richer too.
What was the buying power of the poor when inflation was double digits in the 70's?
The middle class buying power. Ah yes, the shrinking middle class. how many computers, cars, televisions, electronic equipment, did the middle class have back in the 70's. How much was gas per gallon in the 70's. Food prices, adjusted for inflation. What is the evidence the middle class today has less purchasing power than they did pre-Reagan.
More on the shrinking middle class. Ok. Yes these numbers are from 2007, pre crisis. The Crisis is an outlier, so it'll be a few years before we know the lasting effects of it.
Go to page 29. They tally up the total number of households that make money in each category. If you look at the row starting in 1981 you see the percentages of each category. Fast forward to the top 2006. In almost each category, and especially from 25k-75k they all drop. So this reinforces the notion that the middle class shrunk, if you define the middle class as earning $25,000 - $75,000. However, there is a problem. The notion that a shrinking middle class is bad requires us to believe that families dropped out of the middle class and into the lower class, >$25,000.
But if you look at the numbers for those earning less than $25,000 they all drop too. From 30.8% in 1981, to down to 25.2%. Huh? How does that work?
So those making 25k - 75k went from 50.5% in 1981 to 44.3% in 2006. So yes, the middle class shrunk 6.2% of all taxpaying households.
So we should see an increase in the lowest $25,000 but we don't. We see that it shrunk as well, from 30.8% to 25.2%.
That means 5.6% of households who made less than $25,000 moved up a class (defined by the $25,000 barrier) into the middle class. But the middle class also shed households, so 11.8% of households moved up over the $75,000 barrier into the upper class. These are inflation adjusted numbers.
So when Politicians talk about a shrinking middle class they hide the fact that the middle class was shrinking into the upper class.
Other than politically, How is that a bad thing????
Everyone moved up. So politicians are crying about a shrinking lower and middle class. Tell me how that is undesirable? Only in a spread the wealth communist society. Everybody is rich or nobody is rich (which is where it usually ends up in such societies).
In every society there will always be a pyramid. I'd like to see that pyramid smoothed out. Sure. I'm greedy, but I'm not selfish. I want everyone to be successful. Trust me. I love my fellow countrymen. But a pyramid will always exist.
Could we do more? Yes. But we also had a shrinking of lower class as well. They don't tell you about that!!!!! It doesn't fit their narrative.
Again this is pre-2006. We have to watch the next 10 years to see how 2007-now shakes out.