The Decline of the “Great Equalizer”
Americans came to believe over time that education could ensure that all children of any class had a shot at success. And if any state should be able to make that belief a reality, it was Massachusetts.
[…] If the great equalizer’s ability to equalize America is dwindling, it’s not because education is growing less important in the modern economy. Paradoxically, it’s precisely because schooling is now even more important.
Read more. [Image: Reuters]
A Giant Statistical Round-up of the Income Inequality Crisis in 16 Charts
Too see the other 14 charts, click here.
[Images: EPI]
Where the World’s Millionaires Live—in 1 Graph
Today, the United States and Japan are home to about 7% of the world’s population, but more than 50% of the world’s millionaires.
![The Real Problem With Helicopter Parents: There Aren’t Enough of Them
Mocking obsessive parents is fun. But their excesses are small compared to the parenting failures in so many homes. This “Parent Gap” is a real force behind America’s stark and unyielding income inequality.
Read more. [Image: Reuters]](http://24.media.tumblr.com/tumblr_mbqhckyQKm1qcokc4o1_1280.jpg)
The Real Problem With Helicopter Parents: There Aren’t Enough of Them
Mocking obsessive parents is fun. But their excesses are small compared to the parenting failures in so many homes. This “Parent Gap” is a real force behind America’s stark and unyielding income inequality.
Read more. [Image: Reuters]
![Study: American Income Inequality Was Better in 1774 Than It Is Today
Here’s a finding that would have made for great Occupy sign last year: American income inequality may be more severe today than it was way back in 1774 — even if you factor in slavery.
That stat’s not actually as crazy (or demoralizing) as it sounds, but it might upend some of the old wisdom about our country’s economic heritage. The conclusion comes to us from an newly updated study by professors Peter Lindert of the University of California - Davis and Jeffrey Williamson of Harvard. Scraping together data from an array of historical resources, the duo have written a fascinating exploration of early American incomes, arguing that, on the eve of the Revolutionary War, wealth was distributed more evenly across the 13 colonies than anywhere else in the world that we have record of.
Suffice to say, times have changed.
Read more. [Image: Jordan Weissmann]](http://24.media.tumblr.com/tumblr_malo8hp7io1qcokc4o1_1280.png)
Study: American Income Inequality Was Better in 1774 Than It Is Today
Here’s a finding that would have made for great Occupy sign last year: American income inequality may be more severe today than it was way back in 1774 — even if you factor in slavery.
That stat’s not actually as crazy (or demoralizing) as it sounds, but it might upend some of the old wisdom about our country’s economic heritage. The conclusion comes to us from an newly updated study by professors Peter Lindert of the University of California - Davis and Jeffrey Williamson of Harvard. Scraping together data from an array of historical resources, the duo have written a fascinating exploration of early American incomes, arguing that, on the eve of the Revolutionary War, wealth was distributed more evenly across the 13 colonies than anywhere else in the world that we have record of.
Suffice to say, times have changed.
Read more. [Image: Jordan Weissmann]
![Happy Birthday Occupy! Income Inequality Is Still Getting Worse.
Occupy Wall Street may well have been the first global protest movement to rally around a statistic cribbed from an economics paper. So to mark its one year anniversary today, I thought I’d break out some of the latest numbers tracking U.S. inequality, courtesy of this month’s Census Bureau recent report on income, poverty, and health insurance coverage.
From 2010 to 2011, the top 5 percent of U.S. households upped their share of the country’s income by 5.3 percent. The top 20 percent got a 1.6 percent bump. And while the country’s poorest saw their piece of the pie grow by a smidgen, the middle classes lost ground.
Read more. [Image: Jordan Weissmann]](http://25.media.tumblr.com/tumblr_maie9t8gDK1qcokc4o1_1280.png)
Happy Birthday Occupy! Income Inequality Is Still Getting Worse.
Occupy Wall Street may well have been the first global protest movement to rally around a statistic cribbed from an economics paper. So to mark its one year anniversary today, I thought I’d break out some of the latest numbers tracking U.S. inequality, courtesy of this month’s Census Bureau recent report on income, poverty, and health insurance coverage.
From 2010 to 2011, the top 5 percent of U.S. households upped their share of the country’s income by 5.3 percent. The top 20 percent got a 1.6 percent bump. And while the country’s poorest saw their piece of the pie grow by a smidgen, the middle classes lost ground.
Read more. [Image: Jordan Weissmann]
![Mitt Romney’s Tax Plan Only Works If Income Inequality Gets Worse
Romney wants to cut rates and cut loopholes but keep everybody’s taxes the same. That’s the implication of a revenue neutral plan where the rich pay the same share and the middle class pay the same amount. It’s just a complicated way of saying nobody’s tax bills change. But we’re back to the same old problem: the rich pay a lower effective federal tax rate under Romney’s plan, so they won’t pay the same share. Unless they have more money than we’ve assumed.
But there is one way that Romney’s plan works mathematically: Income inequality explodes. If enough growth goes to the top 5% of earners, they will get rich enough to fill the revenue hole.
Read more. [Image: Matthew O’Brien]](http://25.media.tumblr.com/tumblr_m9mkgsSvwA1qcokc4o1_1280.png)
Mitt Romney’s Tax Plan Only Works If Income Inequality Gets Worse
Romney wants to cut rates and cut loopholes but keep everybody’s taxes the same. That’s the implication of a revenue neutral plan where the rich pay the same share and the middle class pay the same amount. It’s just a complicated way of saying nobody’s tax bills change. But we’re back to the same old problem: the rich pay a lower effective federal tax rate under Romney’s plan, so they won’t pay the same share. Unless they have more money than we’ve assumed.
But there is one way that Romney’s plan works mathematically: Income inequality explodes. If enough growth goes to the top 5% of earners, they will get rich enough to fill the revenue hole.
Read more. [Image: Matthew O’Brien]
![The GOP’s Bizarre, Disturbing Passion for Raising Taxes on the Poor
The Republicans, it goes without saying, are the party of low taxes. Their position for the past two years has been simple: Budget deficits should be reduced solely through spending cuts, not increases in tax revenues—even if those revenues are increased solely by closing loopholes in the tax code. The vast majority of Republicans in Congress have signed the Taxpayer Protection Pledge, which commits them to vote against any bill that would either increase tax rates or increase tax revenues.
That should be the whole story. But it isn’t.
As Bruce Bartlett reminds us in his latest Economix column, leading Republican figures, including Eric Cantor, as well as a majority of party members, argue that taxes should go up … on the poor. They are talking about the famous “47 percent” who don’t pay federal income taxes.
Read more. [Image: Reuters]](http://24.media.tumblr.com/tumblr_m58bqbXG6k1qcokc4o1_1280.jpg)
The GOP’s Bizarre, Disturbing Passion for Raising Taxes on the Poor
The Republicans, it goes without saying, are the party of low taxes. Their position for the past two years has been simple: Budget deficits should be reduced solely through spending cuts, not increases in tax revenues—even if those revenues are increased solely by closing loopholes in the tax code. The vast majority of Republicans in Congress have signed the Taxpayer Protection Pledge, which commits them to vote against any bill that would either increase tax rates or increase tax revenues.
That should be the whole story. But it isn’t.
As Bruce Bartlett reminds us in his latest Economix column, leading Republican figures, including Eric Cantor, as well as a majority of party members, argue that taxes should go up … on the poor. They are talking about the famous “47 percent” who don’t pay federal income taxes.
Read more. [Image: Reuters]
There’s something intuitively compelling about the idea that America’s growing income inequality helped fuel the 2008 financial crisis. The narrative, which got an official stamp from Congress’ Democrat-led Joint Economic Committee back in 2010, goes something like this: As middle class wages stagnated, families borrowed more to prop up their standard of living. Banks, along with Fannie Mae and Freddie Mac, happily provided them with unaffordable mortgages, which they then skillfully repackaged and sold as securities. Eventually, the whole house of cards collapsed, plunging us into the Great Recession.
The story is downright elegant — a sort of grand, unified theory of our present economic woes. But according to a new study, it’s plain wrong.
The working paper, from Professors Christopher Meissner of the University of California, Davis and Michael Bordo of Rutgers, looks at whether there is a consistent historical relationship between rising income inequality and financial crises, using economic data on fourteen countries, including the United States, from between 1920 and 2008. It finds that although big financial busts tend to follow on the heels of credit booms like the mortgage bubble, there is no statistical relationship between the expansion of credit and the share of a country’s income going to it’s top 1 percent.
What does drive loose lending? Low interest rates and an expanding economy. When credit is cheap and times are good, people borrow. Simple.
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Here’s today’s Daily GIF!
