Rich People Have Lots of Money
These gains are impressive, indeed. But not exactly surprising.
After all, the bottom quintile is bounded. Some significant percentage of them have no taxable income at all. And welfare benefits don’t count as income for tax purposes. The top quintile, meanwhile, is essentially infinite.
In 1979, most people knew the names of every single billionaire on the planet; there were only a handful of them. There are more billionaires in India now than there were in the world then. The United States had thirteen as late as 1985. And then it started to explode — we had 99 a mere five years later. We’re well over 700 now. That’s going to skew the numbers a bit!
But, remember, these are inflation-adjusted numbers. So, the poorest quintile has seen an 11 percent gain, the middle quintile a 21 percent gain, and so on. In real terms. And that’s not accounting for the fact that the cost of luxury goods, especially electronics, have plummeted and that things that were either luxury goods — or the stuff of science fiction — in 1979 are now commonplace even in the lower strata.
And, of course, there’s significant social mobility. To be sure, there’s a wide gap in what the poorest of the poor and the richest of the rich can do for their children. But, outside perhaps the top and bottom five percent, these economic strata aren’t a caste system.