Wall Street Protests

[BigV]

Originally Posted by Undertoad

BigV, this chart is a STUNNING example of misuse of statistics.

A similar graph would be created in almost ANY bell curve, measuring ANY statistic!

This graph is showing us that the top 1% make more money than the lower 99%. (Duh)

The graph is NOT saying is that the top 1% are getting way way richer than everybody else... and it is NOT saying that the top 1% has any greater inequality in 2007 than it did in 1979!

"Cumulative" means that the data point in 1980 is the after-tax income of 1980 PLUS the after-tax income of 1979. And so the 1981 number is 1981+1980+1979. And so forth.

"But wait a minute," I hear you typing, "Isn't it still remarkably unfair that the top 1% accumulate so much more after-tax money than even their buddies in the 99-95% range?"

No -- because the 1% in 1979 are not the SAME 1% in 2007!

The graph wants you to accept the narrative that it's the same guys in 1979, who now are fabulously wealthy as they accumulated truckloads of stuff by 2007.

But what if we graphed the top 1% of home-run hitters in baseball? In 1979, that would be Dave Kingman, Mike Schmidt, Gorman Thomas, Fred Lynn and Jerry Rice. In 2011, that would be Jose Bautista, Curtis Granderson, Matt Kemp, Mark Teixeira and Prince Fielder.

The graph of that top 1% would look very similar to this graph. Each year, the top 1% of home-run hitters would accumulate more home runs than the bottom 99%. Some years, as in the steroid years, they would accumulate it faster. Some years, as in the current years, they would accumulate it slower. But it's not the same guys accumulating! It's just the constant top 1%.

To put it another way? In 1979, Bill Gates ran a tiny software house that offered a version of the BASIC programming language to fellow geeks. He was busy begging them not to pirate it. In 1979, Bill Gates was measured in the bottom line of that graph.

That's one theory... or you could be reading it wrong. You are overthinking it.

I'm gonna go with number two. Let's look at the same values in numeric form, shall we? You can do the multiplier math yourself; tell me what you think, ok?

Key: Year=Yr;
Lowest Quintile=LQ
Second Quintile=SQ
Middle Quintile=MQ
Fourth Quintile=FQ
Highest Quintile =HQ
All Quintiles=AQ
Top 10%=T10
Top 5%=T5
Top 1%=T1
Average After Tax Income (2007 dollars)=Avg$
-----------------------------------------------------------------------------------------------

 Yr      LQ        SQ        MQ       FQ        HQ       AQ       T10        T5         T1 
-----------------------------------------------------------------------------------------------
1979   15,300    31,000    44,100   57,700   101,700   49,300   128,700   169,600    346,600
1980   14,800    29,800    42,600   55,800    98,700   47,700   125,400   164,000    339,200
1981   14,300    29,200    41,800   55,600    98,500   47,400   125,300   164,300    351,100
1982   13,900    28,800    41,500   56,000   101,900   48,300   131,600   176,000    388,600
1983   13,300    27,800    41,000   56,000   106,000   48,800   138,700   186,500    424,800
1984   13,500    29,100    42,500   58,100   112,800   50,600   149,300   203,100    464,500
1985   13,700    29,100    43,200   58,700   116,200   51,900   155,300   213,300    507,400
1986   13,800    29,900    44,300   60,800   131,500   55,700   180,700   259,500    674,100
1987   13,600    29,000    44,200   61,100   120,600   53,300   160,100   218,200    503,200
1988   13,900    29,500    44,600   61,500   130,000   55,500   177,100   250,400    647,700
1989   14,500    30,200    45,200   62,300   130,000   56,200   176,300   246,300    609,700
1990   14,800    30,700    45,000   61,400   126,400   55,600   170,200   236,800    586,000
1991   14,800    30,400    44,500   60,900   121,600   54,200   161,700   220,500    520,100
1992   14,600    30,400    44,800   61,700   126,600   55,600   170,400   237,500    583,700
1993   14,900    30,600    45,100   62,200   124,600   55,400   165,200   225,100    529,400
1994   15,100    31,000    45,500   63,100   126,100   56,000   167,800   229,500    535,100
1995   15,900    32,400    46,700   64,000   131,200   57,900   175,300   244,600    586,400
1996   15,700    32,300    47,300   65,200   137,400   59,600   186,700   261,300    648,100
1997   16,100    32,800    48,000   66,300   145,700   61,900   201,600   289,700    755,700
1998   16,900    34,600    49,600   69,000   155,400   65,200   218,100   319,600    868,200
1999   17,300    35,300    50,600   70,700   163,800   67,700   230,900   338,900    943,800
2000   16,500    34,900    50,400   71,300   170,300   68,700   242,600   360,600  1,038,700
2001   16,500    35,700    51,900   71,600   156,800   66,200   216,800   311,100    824,500
2002   16,100    34,900    51,000   70,600   150,400   63,900   204,600   286,700    730,500
2003   15,900    34,900    51,300   72,000   157,700   65,600   216,400   307,600    792,900
2004   16,000    35,600    52,900   74,200   170,300   69,000   238,400   346,400    946,900
2005   16,400    36,000    53,300   74,800   183,200   71,900   262,100   393,200  1,135,900
2006   16,900    36,300    53,500   75,900   189,900   74,000   273,500   412,900  1,230,900
2007   17,700    38,000    55,300   77,700   198,300   76,400   289,300   440,500  1,319,700

The chart is a graphic representation of these numbers, (omitting some subsets, like top 10%, top5%, etc.). But you can easily do the arithmetic and see that for those people in the lowest quintile (NOT A GIVEN INDIVIDUAL like Bill Gates or some poor single mother) the after tax income for that group has grown by a factor of 17,700/15,300 or about 1.25. You can easily see that the after tax income for the group of people in the top 1% (not individuals, but the folks that were in that group, for that year) has grown by a factor of 1,319,700/346,600 or about 3.75. Just like the graph shows.

The increase in afflluence, the "are you better off today than you were four years ago" Reagan=reasoning, the Life is good and keeps getting better, faster, has happened to the group of people in the top 1% at a rate that is so much faster and farther than the, dare I say it, the 99%, that it is STUNNING .

STUNNING . unconscionable, counterproductive, unhealthy, and unsupportable. We are the 99% and we're down here in the mud, income wise, as these numbers clearly show. You, and others, fail to comprehend or heed them at your peril.