Tuesday, March 13, 2012

The rich grew richer faster after Reagan than did the rest of us.

My friend Julianne alerted me to this graph from Lane Kenworthy's blog, Consider the Evidence. It provides another way of showing what happened in the U.S. economy since Ronald Reagan was elected. The top lines show how the average income has evolved in the United States since 1950 and the lower lines show how the median income has evolved. From 1950 to 1980, the two increased in step -- increases in the productivity of the economy as a whole were shared in such a way as not to make the distribution of income more unequal.

After 1980, the median and the average income levels diverged. The median income continued to grow, but more slowly than the average income. What that means is that the rate of growth of high incomes was greater than the rate of growth of low incomes; the higher income people appropriated more of the growth of the economy for themselves than the poor or than they had previously.

Incidentally, during a period that roughly corresponds to the Clinton administation, the median and average incomes increased at the same rate. The divergence occurred primarily in the Reagan and two Bush administrations -- which of course lasted for 20 years.

1 comment:

Brandt Hardin said...

Reagan has a legacy so distorted by the Conservative idolization of him that we may never have a clear picture of the real man behind the television set beyond the elaborate myth now concocted around him. Did he really rid the world of commie scum? Did destroy or save our economy? Check out my portrait of The Gipper in commemoration of the Reagan Centennial and help me figure it out on my artist’s blog at http://dregstudiosart.blogspot.com/2011/02/happy-100th-gipper.html