Mobility

There was a blog post related to a Treasury Dept study that emphasizes a fact that I have highlighted for a long time.

When people (mostly on the Left) discuss income inequality, they refer to a group they call the "rich." However, one of the biggest flaws is that the "rich" are hardly ever the same group of people over time. Income mobility moves people in and out. New entrepreneurs, businessmen/women and sports athletes change the makeup of the super-rich time and again. Those that made fortunes in one year, may not make it in another. Note the Dept of the Treasury report:

" Income mobility of individuals was considerable in the U.S. economy during the 1996 through 2005 period with roughly half of taxpayers who began in the bottom quintile moving up to a higher income group within ten years.
About 55 percent of taxpayers moved to a different income quintile within ten years.
Among those with the very highest incomes in 1996 — the top 1/100 of one percent — only 25 percent remained in the group in 2005. Moreover, the median real income of these taxpayers declined over the study period.
The degree of mobility among income groups is unchanged from the prior decade (1987 through 1996).
Economic growth resulted in rising incomes for most taxpayers over the study period: Median real incomes of all taxpayers increased by 24 percent after adjusting for inflation; real incomes of two-thirds of all taxpayers increased over this period; and median incomes of those initially in the lower income groups increased more than the median incomes of those initially in the high income groups. "

So comparison of income classes year over year, needs to be taken with a grain of salt because they aren't the same people. So the "rich get richer" isn't accurate. It's the 1% of the highest income earners earned more than their counterparts in earlier years.

Soon to shred

Emily's birthday today. We got her a wakeboard. Originally slated as a Christmas gift, we determined it cruel to give such a gift when use of it would be five months away. With the snow gone and talk of "ice-out" dates, near-term use seems more reasonable in April.

Happy Birthday, Em.

Quote of the Day

"Democrats immediately began attacking Paul Ryan's budget proposal. Rep. Debbie Wasserman-Schultz said that it was literally a death trap for seniors, while Pelosi claimed the GOP's spending cuts would starve the elderly. But remember what Schultz was saying about toning down our rhetoric just a couple months ago? And how Obama lectured Republicans last year about not scaring seniors?" Laura Ingraham.