This article raised a few questions for me, because I'm not sure if i understand it completely. First, why is the data broken into quintiles versus quartiles? I'm just curious to know if this holds some sort f significance when it comes to "calculating" or measuring inequality. Also, the article claimed that "the ability for an individual or particular household—to move up or down the income ladder is unrelated to whether the rungs of the ladder are being more widely spread out". I'm not entirely sure what that means. Is this claiming that a person's mobility between classes or economic success is mutually exclusive in regards to the actual gaps that cause inequality? And if that is the message, is this true? I'm just a tad confused.
This article was a bit confusing. To address Dominique's question: A quintile is a different form of measuring a series of data particularly population given a specific variable. The word quintile refers to 5 separate groups whereas a quartile refers to 4 separate groups. I would assume that the author choose to use quintiles instead of quartiles since there are five variables in the first chart (Market Income, Government Transfers, Before-Tax Income, Federal Taxes, After-Tax Income). If you click the link to the article in the first paragraph you'll get definitions of some of the jargon used in the initial article. Overall, this article requires a bit of outside reading for those of us (myself included) who are not familiar with economic jargon.
The ability for an individual to move up or down the income ladder varies depending on a persons socio-economic status, education, and other life effecting factors. Even if the top 1 percent were to be removed as the article suggests income inequality would still exist.
I completely understand the difference between a quintile and a quartile, I just didn't understand the reason why the author chose to use quintiles to separate the groups, but your insight helped. Breaking the data up into this many sections does seem to help because you have more groups to compare between. But why would the number of variables being observed change how many groups the author wants to observe? If they are looking at the same five things in each group, that shouldn't change the physical division of the groups-does that make sense? I'd presume that it was brroken into 5 sections so that there is an actual "middle" section versus having to calculate the differences between the 2nd and 3rd quartile; why they used quintiles. Just a guess now that I look at the chart again!
Michael Marinelli We would still have income inequiality no matter what the case. If you remove the top 1 percent of earners all the chart would show is a strong difference between the higher income earners and the poor. Regardless the of the quntiles the data doesn't really change.
In agreement with Michael, one thing I noticed is that historically, the highest quintile continues to hold on to a greater share of their wealth and income than the four quintiles below them, which constitute a majority of the population, and this perpetuates inequality because most people have no wealth to grow, nothing to turn to for long-term financial/economic stability.
This piece seems to be acknowledging that income increases have benefited the rich far more than any other income group. At the same time, the critique government efforts to even out income growth. This is likely due to the fact that Reason is a libertarian organization, which means it opposes large governments. One particularly interesting piece of information for me was the piece briefly discussing the VAT in Europe. Yes, while a VAT does mean that everyone is paying about the same, it kind of defeats to purpose of equitability if income inequality is so great. In the European countries, their Gini index is substantially lower than hours. This means more people are likely to be able to afford paying the tax, which results in it being effective and equitable.
I found this article to be pretty confusing at first. But once I got past the economic vocabulary that was foreign to me, I got the gist. I thought it was crazy that the top quintiles income rose nearly 200 percent while the lowest quintiles only raised 45 percent. Its one thing to analyze this retrospectively but it made me wonder what people were thinking at the time. Were people aware of this disproportionate trend? Did they see the rich getting richer and see it as a success? What did people think would be the future implications of such an upward growth?
This article helped break down the income distribution by showing the different classes and their incomes in a series of charts. I had to read through this article three times and I’m still not completely positive that I understood everything that the author, Nick Gillespie was saying. One issue I found with the article is that it is becoming increasingly more difficult to label lower, middle, and upper class. Currently, the middle class seems to be dissolving into either the lower or higher classes. The European taxing system albeit more transparent, still has large problems attached to it. Political and government officials would find this distribution to be unfair and not implement it, because many of these workers (who are in the upper class) would be taxed more. At the end of this article, Gillespie cites Winship with a argument that contradicts what I have been told that the spreading out of classes is not related or correlated to economic equality.
For me, these charts basically confirm the major social narrative of the rich getting richer. The top 1% as alluded to in the second chart consistently received the highest income growth rates, nearly triple the rates of the lowest three quintiles of the population, despite the higher taxes they had to pay. Interesting to note as part of the discussion, in my opinion I don't think the tax rate should be used as a measure of equality for the fact that those at higher income brackets can 'naturally' afford to pay higher taxes without it majorly affecting their household's financial stability. Whereas people in the lower earning sections of society may have a harder time paying their taxes while putting food on the table simultaneously.
Also towards the end the article makes the statement that "income mobility—the ability for an individual or particular household—to move up or down the income ladder is unrelated to whether the rungs of the ladder are being more widely spread out." I completely disagree with this statement. Mobility is strongly related to the spread of the ladder rungs, just the same as a child's ability to climb a ladder on a playground is affected by the spacing of those ladder's rungs. Children with longer arms or a more extended reach are going to have an easier time traversing the ladder regardless of the rungs' spacing than those who cannot spread themselves between the larger rung gaps. If you can't reach the rungs, then you can't be mobile. Same as with the economic side of things. If the rungs are spread too far apart for your circumstances or abilities to reach them, then you cannot move and your economic mobility is sure to be affected.
At first, this article was very intimidating for me. There was some vocabulary that I was unfamiliar with so it took me awhile to understand; however, I was able to grasp it in the end. I liked how the article articulated both with words and charts, how the income is distributed within the United States. They separated Americans into four classes; the top 1%, the top income quintile, the middle income quintiles and the bottom income quintiles. In the end, it was very clear that over the last 30 years, the gap between the rich and the poor has gotten significantly wider because the top 1% has gotten significantly richer.
The third chart is the one that I am most fascinated by and most interested in. This chart shows that over the last 30 years, the average after-tax income for from the 1st to 99th percentile has grown no more than 67 percent. However, the top 1 percent of wealth has grown about 200 percent. This is outrageous because it shows how 1% of the population is gaining most of the money while the other 99% isn't making much money at all. This is a quintessential representation of income inequality in the United States. It shows that the rich get richer while the rest of Americans are struggling to make money.
This article was very confusing to me at first due to the economic jargon that was new to me. However, after I got passed that, I was able to study the charts which were very interesting. I thought this article was compelling because it tackles either way to understand the information through both words and chart. I had no previous knowledge of quintiles but after learning about it, I find it a very convenient and smart way of representing and explaining the statistical value of a given population. To me, the most intriguing part of this article was reading about how the top 1 percent of the population has almost all of the wealth while the rest of the population is not making nearly that much money. This brings me to question why the rich is able to get progressively richer while the rest of the population's wealth is staying still? Caitlin Crouse
The three charts sum up how income inequality has increased between 1971 and 2011. Even though it does not show a difference in mobility I believe that might be directly related to the housing market itself. Loans were just given out, with out any actual security that the people would pay the loans back. That may looked like mobility has not changed at all when in a sense it did. The wages were higher in the 1970s making it easier to obtain loans to buy houses, later on wages are actually lower making it more difficult for people to buy houses, but that was not the case banks were given out loans to anyone. I think that had a play and making mobility look like it did not change at all. -Joshua Zidek
This article was hard for me to get through, especially with the economic language that I am not familiar with. However, I think the last paragraph is especially interesting: "The entire debate is worth a listen but Winship's main point is that income mobility—the ability for an individual or particular household—to move up or down the income ladder is unrelated to whether the rungs of the ladder are being more widely spread out." Obviously, the rungs of the ladder are the gaps between income (income inequality), and the actual ladder is the ability to move upward or downward (upward mobility, specifically). However, I think this point is untrue - literally and metaphorically. Income gaps make it especially harder for people to move upward income wise, as the saying goes, the rich get richer and the poor get poorer. This is shown specifically in the charts that date back from 1971 to 2011 - income inequality has only increased; in other words, why would those that have the money and status quo change their status quo when they are in a good spot? It does not make sense. As for, the literal meaning of this quote, it is literally harder to get up a ladder if the rungs are further spread apart.
It surprised me to see some support that increased income inequality doesn't necessarily result in decreased mobility. That seems rather counter intuitive to me. One would think that the further apart the rungs of a ladder the harder it would be to get to the next one. I imagine that there is more going and I'll be interested in listening to Winship's debate.
This article was an interesting read and you can get a lot from the three charts presented. It is clear that the income gap has significantly increased between the rich and the middle/poor classes and as a result, increased inequality on the Gini index. I thought that the final paragraph discussing the relationship between inequality and economic mobility was very interesting. I had never considered that increased inequality may not have that much of an effect on economic mobility, I thought that the two affected one another. The discussion of the U.S. tax system in comparison to other wealthy foreign countries informed my understanding of some of the flaws our tax system has.
This article portrays the idea that the rich are only getting richer. It is namely, common sense to think that the rich can afford higher taxes without a large affect on their overall financial situation because they earn a lot more. While the people that are earning less experience harsher results from paying taxes because they earn less and can really benefit from any dollar they can save or earn. This article provides proof that the gap between the rich and the poor has only gotten larger over the years. I would think that because this article was set out to prove that such large rungs of the ladder of mobility in America exists, they would also defend that mobility in America is extremely difficult for the lower class however, this article sets out to claim that income mobility is independent of whether the gap between the rich and the poor are wide or not, which I found interesting.
I don't know if this is due to my misunderstanding, but, I was informed by different articles that income after-tax has gone down across the board but this article seems to say different? Perhaps I misunderstood, but obviously the top 1% has not been effected in decades, for their after-tax income has increased 200 percent, but a lot of this has to do with employers who ow big companies claim most of their wealth via capital gains which reckon less taxes from the government, it seems the author is not too happy with this, enforcing the idea that mobility amongst income is seemingly becoming harder and harder to attain. -Crash
I think this article is really important because it just shows again how unequal the US is. The charts really help demonstrate the inequality, especially in the 2nd chart which shows the income growth in the past 3 decades. The 1%, the wealthiest of the wealthiest people in America, their income has grown more than 200%. This is compared to the rest of the country (the other 99%), where income grew somewhere between 40-67%. The richest 1% got more than 4x richer than all the other classes combined. I think this is the most important chart because it illustrates how the rich got increasingly richer, while the rest of the country stayed the same.
Like others I too found this article to be a bit confusing, but at the same time incredibly interesting. It just amazes me just have large of a gap there is from those at the top to those at the bottom and things simply have not gotten better at all. Income inequality in the United States pretty much is at an all time high and things simply have not changed in this country. It is absolutely absurd to see that the income of those in the top 1% has grown more than 200% compared to only 40-60% for everyone else. Granted yes in the grand scheme everyone is making more money, but the gap is still growing.
After reading this article, I found myself a bit confused but was able to follow the trend. It seems as if that is a trend with this particular article. However, I feel like that speaks to the issue at hand. Income inequality is a confusing issue to many americans. Is there a line where we can say people are earning things they don't deserve? I do not think all professions are equal by any means but having the 1% growing more than 200% is definably alarming. There is no case is which someone deserves 200% more than anyone else. This is an issue and I unfortunately do not think it will ever be equal but it could be fair.
As many have already said, the article and the charts are a bit confusing and take a bit of rereading and fine examination to fully comprehend. The charts do show that there still exists a gap between classes and it continues to widen. In the second chart, it is apparent that over the last 30 plus years, the rich have seen a great increase in their income (even after taxes) while lower classes haven't seen as much of significant increase. It is unfortunate that other countries can get themselves together and the U.S. has only continued to allow inequality in all areas to perpetuate.
The graph I found the most shocking was the graph showing income growth over the time period between 1979 and 2011. This graph shows that the top 1% saw their income grow exponentially while the rest of the 99% saw modest to little to no growth at all. For me, this graph shows that the 1% becoming increasingly rich is not just a problem for people in the bottom quintile or people with lower incomes. This is a problem that effects every single tier of the income ladder, as the billionaires are getting richer and richer while the rest of every other American sees their income remain stagnant.
This was a confusing article to read, but it seems that income has increased and benefitted the rich more than others. The rich get richer and the poor get poorer. What was a bit confusing was how the author broke down quintiles and quartiles and how it’s used to calculated inequality. Could it be that it is used to measure the mobility of individual’s income that are available to move up the ladder. The 5 groups I assume were broken down that way to make it more visual for people to see that there is a median to better calculate the percentiles for the rich and poor, or others words the upper and lower class income increase.
Based on observing these charts and after watching Inside Job, I think income inequality does reduce economic mobility. The top 1% has systematic advantage over the finance service industry and has close connections with government officials. The fact that they are in the pockets of the officials are can influence their stances on deregulation and merger policies. All while the 99% doesn’t have a chance to move up economically.
I too had difficulties understanding this article at first. A lot of information regarding the U.S. economy is portrayed in each chart over the years. Undoubtedly, the trend that is presented in these charts is that rich continue to become richer creating a larger gap between the various social classes. The firs sentence of the last paragraph asks, “does increased income inequality reduce economic mobility?” in my opinion it absolutely does. We have learned that in order for one to be able to move up the ladder one must have opportunities available to them. And obviously, the rich have more opportunities than the members of middle/lower classes.
Agreeing with Deven, I too believe that income inequality does reduce economic mobility. It is unfortunate that the rich do benefit off of this income inequality because they do continue to get richer. Unfortunately, I am not sure that the US can become an equal country because we simply do not know how to do so. I believe that with strong education about income inequality and what is really going on within this country that the US can have some hope of fixing this issue.
What I noticed from these charts is that the rich are getting richer, and the rest seem to just stay in the same place. To me, it seems that income inequality has a big effect on economic mobility because as the gap gets bigger, the opportunity becomes smaller and smaller. I think that in order to close the gap, wealth must be more evenly distributed but since that is unlikely to happen, upward mobility remains a challenging task.
The rich are simply staying where they are, and the government is not making an effort to help the poor. These are the conclusions that I drew from the charts on inequality. It’s incredible to see just how much richer the richest quintile are getting, especially compared to how insignificant the gains are for the poorest quintiles. Most interesting perhaps is the fact that the poorest are not falling behind at the fastest rate, but the middle quintiles. This is likely due to the fact that they are taxed more significantly than the poorest quintile.
The two things that struck me about this article are the highest quintile had $11,000 in government transfers and I wonder what they are getting that for? The second chart also illustrates the ways we are “squeezing” the middle-class. The rich continue to get richer, but other classes are stagnating.
The fact that the income increase of the top 1% is about 200% while the other quintiles are down around 40-60% is shocking. People have to recognize that this is a problem and something that needs to be addressed. This small percentage of people does not need this outrageous increase while a larger percentage of the population is living in poverty. These increases can be attributed to the power that the super wealthy have and the ways they are able to bend the rules in their favor.
Given WInship's main point that income mobility is unaffected by the widening of the social latter because those rates haven't changed over the past 30-plus years even as income inequality has increased, I'd think to challange his assertion based on the lack of context surrounding the past thirty years. The definitions of class have changed and so have the perceptions of which class you belong to, Widening this latter might not affect the family's directly, but indirectly, it creates more mediums of class that are not politically recognized. I thought of kids who are conflicted with being coined middle class but do not feel like they are middle class because they can't afford the luxuries usually associated with members of the middle class. Widening the latter makes it harder to move up the social latter because it creates more level of disparities that one may see as significant even those Winship justifies as these rates as unaffected because they are not established/recognized rates of class in American society. Especially when income inequality has increased.
Some of these charts were a tad bit confusing for me but I did pick up a few things from the article. It seems as though the rich are growing wealthy over time while other classes are remaining stagnate. This is slightly worrying to me because this is means that while the wealthy are getting richer the mobility of the lower classes are staying the same which means that they will have a much harder time getting out. Thus this would likely lead to even higher amounts of inequality.
Matt, I agree with you about the inequality growing in the United States. I believe that if something is not done about it will continue to grow and the rich will just get richer. There are a few senators right now that are fighting President Obama pick to run the treasury because they believe having an investment banker will increase the inequality. -Joshua Zidek
It such a difficult job to fight inequality in the United States. There will always be inequality in some sort of way. I really do not think you can eliminate inequality. Even if you started everyone back from zero, some would advance more than others. However I do not think the system we have not is working.
I agree with Sean in that there will always be inequality to some degree, but I also think that in a drastic case such as this, something needs to be done about it. We can't expect it to go away completely, but the charts in this article show that inequality is still growing which is very concerning, since the US's wealth distribution is already one of the most top-heavy out of all major economies. The other thing that these charts show is that inequality and mobility, or the lack thereof, are indeed directly correlated. This should be enough evidence to silence the argument that states that the lower classes are lazy, and that's why there's no mobility. It shows that their income doesn't allow them to move up, regardless of how hard they work
I must note that having read the article and examined the charts and table I’m not entirely sure that I understand everything. The message that I got from the information really just reiterates common knowledge. There are vast amounts of inequality; the rich keep on getting richer. I find the end statement “the ability for an individual or particular household—to move up or down the income ladder is unrelated to whether the rungs of the ladder are being more widely spread out” to be ludicrous. Surly logic dictates that the more the metaphorical rungs of the ladder are spread out the harder it is to move up the ladder.
Like some of the other students, I do not entirely understand this article. But what did stand out to me as somewhat shocking what the fact that the top 20% of income pulled $11,000 on average in transfers from the government. That caught me off guard. I also think that Winship’s view that the ability for and individual or a household to move up or down the income ladder is unrelated to whether the rungs of the ladder are being more widely spread out logically makes no sense to me.
I wish that the data in this chart was explained in a way, which made it more legible for people not working exclusively within the Financial Sector. In retrospect, I found it quite interesting that inflation-adjusted after-tax income for the top 1 percent increased by 200 percent.
I found this to be an interesting, but at the same time it was a bit confusing and a little hard to get through. What I got from it was that there will pretty much always have inequality in our society being that the rich are always getting richer while the rest are just about the same.
I definitely agree. This article was very hard for me to understand. I felt as though the author was talking circles around me. Had he not stated his main idea ("So, does increased income inequality reduce economic mobility?"), I honestly would have no clue what he was trying to get across. Which is sad, because I read the article twice. However, I get the feeling that had I understood what was going on a bit more, it would have been very interesting. Hopefully this is something we will cover more in depth during class.
The ability for an individual to move up or down the income ladder varies. Depending on a persons socioeconomic status, education and simply other qualities of life Even if the top 1 percent were to be removed as the article suggests income inequality would still exist. Even if the high status people were removed, what I was able to take from the article was that there would still be inequality in our society. It is something that seems to be hard to get rid of and something that needs to be worked on every day in order to fix for more of an equal success rate.
There are people who work at a job, and there are people who build the job and have other people work for them. It's a classic tale of the rich getting richer and the poor getting poorer. I was pretty confused at first by the terminology but that's basically the message I got from this, it was not surprising that inequality would be prevalent even if the top 1% wasn't there. I believe inequality will always exist, there are too many variables, too many different types of people controlling the game. Truth is, people will always choose people similar to them, its not a man/women or black/white thing its a people thing, humans kind of suck in that way.
This article was difficult for me to understand at first, but the use of the chart and a few rereads made it easier to understand. I think it did a good job in highlighting the inequalities within our society and strengthened the argument by using the charts and showing the change over time. Jessica Glassman
This article did a nice job showing the statistics of income changes over the past 30 years. Additionally, it was able to make note of things that were surprising that someone without expertise in how income changes and transfer changes would not be able to understand. I was most surprised to see that the acceleration of top 1% wages went at a rate of 5 times the rate of the lowest 20% of Americans, showing that not only is income inequality growing, but that its growing faster than if the rates were the same. Much has been made of ceo wages lately in the public debate and this article shows statistical substantiality to those claims of being bad for the United States.
I found this article very confusing and just hard to understand overall but I was still able to get that the main point seems to be that the rich are getting richer and the poor are staying poor, surprise. I did, however, find it interesting that those in the highest quintile are still pulling in a large amount of government transfers even though many people, including myself, seem to think that only those at the bottom use these programs. It's actually the "middle class" with the highest amount, not the lowest quintile as many would expect, which might help explain why they are the ones with the smallest economic growth among all the groups. Another interesting and shocking fact from this article is that income inequality does NOT affect economic mobility. I found this very surprising because many people tend to blame the rich for "taking everything" and not giving the ones at the bottom a chance, but if income inequality and economic mobility are not correlated, might that suggest that maybe it's those at the bottom not doing enough to help themselves? -Karen Reyes
I think increased income inequality certainly negatively affects economic mobility. If a few people have most of the wealth, there is not much room or wealth for other to strive for or receive.
The one thing that stuck out to me after battling through this difficult to understand article was the last paragraph. The idea that mobility and inequality can be considered two separate entities unaffected by each other is very interesting. In my mind I would think that as mobility increases and becomes easier, inequality would decrease. This is not the case. What can be done to ensure that there is an inverse relationship between mobility and inequality?
The one thing that stuck out to me after battling through this difficult to understand article was the last paragraph. The idea that mobility and inequality can be considered two separate entities unaffected by each other is very interesting. In my mind I would think that as mobility increases and becomes easier, inequality would decrease. This is not the case. What can be done to ensure that there is an inverse relationship between mobility and inequality?
To be honest, I was really confuse while reading these article. First it talks about quintiles, which is a set divided into 5 equal parts I guess. Then it did not give much info about whether there was income- economic mobility within individuals or not. It just stated that there is going to be a research by Scott Winship. I am not that much into economics, so this was kind of new language for me.
To be honest, I was really confuse while reading these article. First it talks about quintiles, which is a set divided into 5 equal parts I guess. Then it did not give much info about whether there was income- economic mobility within individuals or not. It just stated that there is going to be a research by Scott Winship. I am not that much into economics, so this was kind of new language for me.
This article was a little difficult to understand but the main takeaway I got from it was that there is absolutely no relation with moving up or down the income ladder and the space between the rungs of the ladder. I took this statement to mean that as citizens in society we have the ability to place ourselves in any situation financially regardless of how our financial system is built. Yes, income inequality has continued to increase over the years but it is important for citizens to know that your economic position is not guided by this inequality and you can still improve economically if you take the proper steps.
While this article was not the easiest read, I think I got the main point. Income inequality is a serious problem in this country; the flow of wealth trends almost exclusively upward. The government does not do enough to address this problem, and until they do, it will continue to plague the U.S.-Damarr Gordon
Since I am not an economics major I did not thoroughly understand these charts nor their importance. However, I did find it crazy that some families are subject to live on $15,500 a year, truly showing how wide the inequality gap in America is. -Gregory Brown
I found this article a little bit difficult to read ad understand because I do not know much about economics. The author did not present information about whether there was a sure answer about whether income or economic mobility was possible for individuals in this society. Towards the end of the article the author states that mobility is unrelated to whether the gaps between the classes are being more widely spread out.
I found this article a little bit difficult to read ad understand because I do not know much about economics. The author did not present information about whether there was a sure answer about whether income or economic mobility was possible for individuals in this society. Towards the end of the article the author states that mobility is unrelated to whether the gaps between the classes are being more widely spread out.
This article raised a few questions for me, because I'm not sure if i understand it completely. First, why is the data broken into quintiles versus quartiles? I'm just curious to know if this holds some sort f significance when it comes to "calculating" or measuring inequality. Also, the article claimed that "the ability for an individual or particular household—to move up or down the income ladder is unrelated to whether the rungs of the ladder are being more widely spread out". I'm not entirely sure what that means. Is this claiming that a person's mobility between classes or economic success is mutually exclusive in regards to the actual gaps that cause inequality? And if that is the message, is this true? I'm just a tad confused.
ReplyDeleteThis article was a bit confusing. To address Dominique's question: A quintile is a different form of measuring a series of data particularly population given a specific variable. The word quintile refers to 5 separate groups whereas a quartile refers to 4 separate groups. I would assume that the author choose to use quintiles instead of quartiles since there are five variables in the first chart (Market Income, Government Transfers, Before-Tax Income, Federal Taxes, After-Tax Income). If you click the link to the article in the first paragraph you'll get definitions of some of the jargon used in the initial article. Overall, this article requires a bit of outside reading for those of us (myself included) who are not familiar with economic jargon.
ReplyDeleteThe ability for an individual to move up or down the income ladder varies depending on a persons socio-economic status, education, and other life effecting factors. Even if the top 1 percent were to be removed as the article suggests income inequality would still exist.
I completely understand the difference between a quintile and a quartile, I just didn't understand the reason why the author chose to use quintiles to separate the groups, but your insight helped. Breaking the data up into this many sections does seem to help because you have more groups to compare between. But why would the number of variables being observed change how many groups the author wants to observe? If they are looking at the same five things in each group, that shouldn't change the physical division of the groups-does that make sense? I'd presume that it was brroken into 5 sections so that there is an actual "middle" section versus having to calculate the differences between the 2nd and 3rd quartile; why they used quintiles. Just a guess now that I look at the chart again!
ReplyDeleteMichael Marinelli
ReplyDeleteWe would still have income inequiality no matter what the case. If you remove the top 1 percent of earners all the chart would show is a strong difference between the higher income earners and the poor. Regardless the of the quntiles the data doesn't really change.
In agreement with Michael, one thing I noticed is that historically, the highest quintile continues to hold on to a greater share of their wealth and income than the four quintiles below them, which constitute a majority of the population, and this perpetuates inequality because most people have no wealth to grow, nothing to turn to for long-term financial/economic stability.
DeleteThis piece seems to be acknowledging that income increases have benefited the rich far more than any other income group. At the same time, the critique government efforts to even out income growth. This is likely due to the fact that Reason is a libertarian organization, which means it opposes large governments. One particularly interesting piece of information for me was the piece briefly discussing the VAT in Europe. Yes, while a VAT does mean that everyone is paying about the same, it kind of defeats to purpose of equitability if income inequality is so great. In the European countries, their Gini index is substantially lower than hours. This means more people are likely to be able to afford paying the tax, which results in it being effective and equitable.
ReplyDeleteI found this article to be pretty confusing at first. But once I got past the economic vocabulary that was foreign to me, I got the gist. I thought it was crazy that the top quintiles income rose nearly 200 percent while the lowest quintiles only raised 45 percent. Its one thing to analyze this retrospectively but it made me wonder what people were thinking at the time. Were people aware of this disproportionate trend? Did they see the rich getting richer and see it as a success? What did people think would be the future implications of such an upward growth?
ReplyDelete- Ana Kyriakos
DeleteThis article helped break down the income distribution by showing the different classes and their incomes in a series of charts. I had to read through this article three times and I’m still not completely positive that I understood everything that the author, Nick Gillespie was saying. One issue I found with the article is that it is becoming increasingly more difficult to label lower, middle, and upper class. Currently, the middle class seems to be dissolving into either the lower or higher classes. The European taxing system albeit more transparent, still has large problems attached to it. Political and government officials would find this distribution to be unfair and not implement it, because many of these workers
ReplyDelete(who are in the upper class) would be taxed more. At the end of this article, Gillespie cites Winship with a argument that contradicts what I have been told that the spreading out of classes is not related or correlated to economic equality.
For me, these charts basically confirm the major social narrative of the rich getting richer. The top 1% as alluded to in the second chart consistently received the highest income growth rates, nearly triple the rates of the lowest three quintiles of the population, despite the higher taxes they had to pay. Interesting to note as part of the discussion, in my opinion I don't think the tax rate should be used as a measure of equality for the fact that those at higher income brackets can 'naturally' afford to pay higher taxes without it majorly affecting their household's financial stability. Whereas people in the lower earning sections of society may have a harder time paying their taxes while putting food on the table simultaneously.
ReplyDeleteAlso towards the end the article makes the statement that "income mobility—the ability for an individual or particular household—to move up or down the income ladder is unrelated to whether the rungs of the ladder are being more widely spread out." I completely disagree with this statement. Mobility is strongly related to the spread of the ladder rungs, just the same as a child's ability to climb a ladder on a playground is affected by the spacing of those ladder's rungs. Children with longer arms or a more extended reach are going to have an easier time traversing the ladder regardless of the rungs' spacing than those who cannot spread themselves between the larger rung gaps. If you can't reach the rungs, then you can't be mobile. Same as with the economic side of things. If the rungs are spread too far apart for your circumstances or abilities to reach them, then you cannot move and your economic mobility is sure to be affected.
At first, this article was very intimidating for me. There was some vocabulary that I was unfamiliar with so it took me awhile to understand; however, I was able to grasp it in the end. I liked how the article articulated both with words and charts, how the income is distributed within the United States. They separated Americans into four classes; the top 1%, the top income quintile, the middle income quintiles and the bottom income quintiles. In the end, it was very clear that over the last 30 years, the gap between the rich and the poor has gotten significantly wider because the top 1% has gotten significantly richer.
ReplyDeleteLindsey Stalnaker
The third chart is the one that I am most fascinated by and most interested in. This chart shows that over the last 30 years, the average after-tax income for from the 1st to 99th percentile has grown no more than 67 percent. However, the top 1 percent of wealth has grown about 200 percent. This is outrageous because it shows how 1% of the population is gaining most of the money while the other 99% isn't making much money at all. This is a quintessential representation of income inequality in the United States. It shows that the rich get richer while the rest of Americans are struggling to make money.
ReplyDeleteThis article was very confusing to me at first due to the economic jargon that was new to me. However, after I got passed that, I was able to study the charts which were very interesting. I thought this article was compelling because it tackles either way to understand the information through both words and chart. I had no previous knowledge of quintiles but after learning about it, I find it a very convenient and smart way of representing and explaining the statistical value of a given population. To me, the most intriguing part of this article was reading about how the top 1 percent of the population has almost all of the wealth while the rest of the population is not making nearly that much money. This brings me to question why the rich is able to get progressively richer while the rest of the population's wealth is staying still?
ReplyDeleteCaitlin Crouse
The three charts sum up how income inequality has increased between 1971 and 2011. Even though it does not show a difference in mobility I believe that might be directly related to the housing market itself. Loans were just given out, with out any actual security that the people would pay the loans back. That may looked like mobility has not changed at all when in a sense it did. The wages were higher in the 1970s making it easier to obtain loans to buy houses, later on wages are actually lower making it more difficult for people to buy houses, but that was not the case banks were given out loans to anyone. I think that had a play and making mobility look like it did not change at all.
ReplyDelete-Joshua Zidek
This article was hard for me to get through, especially with the economic language that I am not familiar with. However, I think the last paragraph is especially interesting: "The entire debate is worth a listen but Winship's main point is that income mobility—the ability for an individual or particular household—to move up or down the income ladder is unrelated to whether the rungs of the ladder are being more widely spread out." Obviously, the rungs of the ladder are the gaps between income (income inequality), and the actual ladder is the ability to move upward or downward (upward mobility, specifically). However, I think this point is untrue - literally and metaphorically. Income gaps make it especially harder for people to move upward income wise, as the saying goes, the rich get richer and the poor get poorer. This is shown specifically in the charts that date back from 1971 to 2011 - income inequality has only increased; in other words, why would those that have the money and status quo change their status quo when they are in a good spot? It does not make sense. As for, the literal meaning of this quote, it is literally harder to get up a ladder if the rungs are further spread apart.
ReplyDeleteIt surprised me to see some support that increased income inequality doesn't necessarily result in decreased mobility. That seems rather counter intuitive to me. One would think that the further apart the rungs of a ladder the harder it would be to get to the next one. I imagine that there is more going and I'll be interested in listening to Winship's debate.
ReplyDeleteThis article was an interesting read and you can get a lot from the three charts presented. It is clear that the income gap has significantly increased between the rich and the middle/poor classes and as a result, increased inequality on the Gini index. I thought that the final paragraph discussing the relationship between inequality and economic mobility was very interesting. I had never considered that increased inequality may not have that much of an effect on economic mobility, I thought that the two affected one another. The discussion of the U.S. tax system in comparison to other wealthy foreign countries informed my understanding of some of the flaws our tax system has.
ReplyDeleteThis article portrays the idea that the rich are only getting richer. It is namely, common sense to think that the rich can afford higher taxes without a large affect on their overall financial situation because they earn a lot more. While the people that are earning less experience harsher results from paying taxes because they earn less and can really benefit from any dollar they can save or earn. This article provides proof that the gap between the rich and the poor has only gotten larger over the years. I would think that because this article was set out to prove that such large rungs of the ladder of mobility in America exists, they would also defend that mobility in America is extremely difficult for the lower class however, this article sets out to claim that income mobility is independent of whether the gap between the rich and the poor are wide or not, which I found interesting.
ReplyDeleteI don't know if this is due to my misunderstanding, but, I was informed by different articles that income after-tax has gone down across the board but this article seems to say different? Perhaps I misunderstood, but obviously the top 1% has not been effected in decades, for their after-tax income has increased 200 percent, but a lot of this has to do with employers who ow big companies claim most of their wealth via capital gains which reckon less taxes from the government, it seems the author is not too happy with this, enforcing the idea that mobility amongst income is seemingly becoming harder and harder to attain.
ReplyDelete-Crash
I think this article is really important because it just shows again how unequal the US is. The charts really help demonstrate the inequality, especially in the 2nd chart which shows the income growth in the past 3 decades. The 1%, the wealthiest of the wealthiest people in America, their income has grown more than 200%. This is compared to the rest of the country (the other 99%), where income grew somewhere between 40-67%. The richest 1% got more than 4x richer than all the other classes combined. I think this is the most important chart because it illustrates how the rich got increasingly richer, while the rest of the country stayed the same.
ReplyDeleteLike others I too found this article to be a bit confusing, but at the same time incredibly interesting. It just amazes me just have large of a gap there is from those at the top to those at the bottom and things simply have not gotten better at all. Income inequality in the United States pretty much is at an all time high and things simply have not changed in this country. It is absolutely absurd to see that the income of those in the top 1% has grown more than 200% compared to only 40-60% for everyone else. Granted yes in the grand scheme everyone is making more money, but the gap is still growing.
ReplyDeleteAfter reading this article, I found myself a bit confused but was able to follow the trend. It seems as if that is a trend with this particular article. However, I feel like that speaks to the issue at hand. Income inequality is a confusing issue to many americans. Is there a line where we can say people are earning things they don't deserve? I do not think all professions are equal by any means but having the 1% growing more than 200% is definably alarming. There is no case is which someone deserves 200% more than anyone else. This is an issue and I unfortunately do not think it will ever be equal but it could be fair.
ReplyDeleteAs many have already said, the article and the charts are a bit confusing and take a bit of rereading and fine examination to fully comprehend. The charts do show that there still exists a gap between classes and it continues to widen. In the second chart, it is apparent that over the last 30 plus years, the rich have seen a great increase in their income (even after taxes) while lower classes haven't seen as much of significant increase. It is unfortunate that other countries can get themselves together and the U.S. has only continued to allow inequality in all areas to perpetuate.
ReplyDeleteThe graph I found the most shocking was the graph showing income growth over the time period between 1979 and 2011. This graph shows that the top 1% saw their income grow exponentially while the rest of the 99% saw modest to little to no growth at all. For me, this graph shows that the 1% becoming increasingly rich is not just a problem for people in the bottom quintile or people with lower incomes. This is a problem that effects every single tier of the income ladder, as the billionaires are getting richer and richer while the rest of every other American sees their income remain stagnant.
ReplyDeleteThis was a confusing article to read, but it seems that income has increased and benefitted the rich more than others. The rich get richer and the poor get poorer. What was a bit confusing was how the author broke down quintiles and quartiles and how it’s used to calculated inequality. Could it be that it is used to measure the mobility of individual’s income that are available to move up the ladder. The 5 groups I assume were broken down that way to make it more visual for people to see that there is a median to better calculate the percentiles for the rich and poor, or others words the upper and lower class income increase.
ReplyDeleteBased on observing these charts and after watching Inside Job, I think income inequality does reduce economic mobility. The top 1% has systematic advantage over the finance service industry and has close connections with government officials. The fact that they are in the pockets of the officials are can influence their stances on deregulation and merger policies. All while the 99% doesn’t have a chance to move up economically.
ReplyDeleteI too had difficulties understanding this article at first. A lot of information regarding the U.S. economy is portrayed in each chart over the years. Undoubtedly, the trend that is presented in these charts is that rich continue to become richer creating a larger gap between the various social classes. The firs sentence of the last paragraph asks, “does increased income inequality reduce economic mobility?” in my opinion it absolutely does. We have learned that in order for one to be able to move up the ladder one must have opportunities available to them. And obviously, the rich have more opportunities than the members of middle/lower classes.
ReplyDeleteAgreeing with Deven, I too believe that income inequality does reduce economic mobility. It is unfortunate that the rich do benefit off of this income inequality because they do continue to get richer. Unfortunately, I am not sure that the US can become an equal country because we simply do not know how to do so. I believe that with strong education about income inequality and what is really going on within this country that the US can have some hope of fixing this issue.
ReplyDeleteWhat I noticed from these charts is that the rich are getting richer, and the rest seem to just stay in the same place. To me, it seems that income inequality has a big effect on economic mobility because as the gap gets bigger, the opportunity becomes smaller and smaller. I think that in order to close the gap, wealth must be more evenly distributed but since that is unlikely to happen, upward mobility remains a challenging task.
ReplyDeleteThe rich are simply staying where they are, and the government is not making an effort to help the poor. These are the conclusions that I drew from the charts on inequality. It’s incredible to see just how much richer the richest quintile are getting, especially compared to how insignificant the gains are for the poorest quintiles. Most interesting perhaps is the fact that the poorest are not falling behind at the fastest rate, but the middle quintiles. This is likely due to the fact that they are taxed more significantly than the poorest quintile.
ReplyDeleteThe two things that struck me about this article are the highest quintile had $11,000 in government transfers and I wonder what they are getting that for? The second chart also illustrates the ways we are “squeezing” the middle-class. The rich continue to get richer, but other classes are stagnating.
ReplyDeleteThe fact that the income increase of the top 1% is about 200% while the other quintiles are down around 40-60% is shocking. People have to recognize that this is a problem and something that needs to be addressed. This small percentage of people does not need this outrageous increase while a larger percentage of the population is living in poverty. These increases can be attributed to the power that the super wealthy have and the ways they are able to bend the rules in their favor.
ReplyDeleteJack O'Connor
Given WInship's main point that income mobility is unaffected by the widening of the social latter because those rates haven't changed over the past 30-plus years even as income inequality has increased, I'd think to challange his assertion based on the lack of context surrounding the past thirty years. The definitions of class have changed and so have the perceptions of which class you belong to, Widening this latter might not affect the family's directly, but indirectly, it creates more mediums of class that are not politically recognized. I thought of kids who are conflicted with being coined middle class but do not feel like they are middle class because they can't afford the luxuries usually associated with members of the middle class. Widening the latter makes it harder to move up the social latter because it creates more level of disparities that one may see as significant even those Winship justifies as these rates as unaffected because they are not established/recognized rates of class in American society. Especially when income inequality has increased.
ReplyDelete-Semira Tesfai
Some of these charts were a tad bit confusing for me but I did pick up a few things from the article. It seems as though the rich are growing wealthy over time while other classes are remaining stagnate. This is slightly worrying to me because this is means that while the wealthy are getting richer the mobility of the lower classes are staying the same which means that they will have a much harder time getting out. Thus this would likely lead to even higher amounts of inequality.
ReplyDelete-Matt
-Matt Fera
DeleteMatt, I agree with you about the inequality growing in the United States. I believe that if something is not done about it will continue to grow and the rich will just get richer. There are a few senators right now that are fighting President Obama pick to run the treasury because they believe having an investment banker will increase the inequality.
ReplyDelete-Joshua Zidek
It such a difficult job to fight inequality in the United States. There will always be inequality in some sort of way. I really do not think you can eliminate inequality. Even if you started everyone back from zero, some would advance more than others. However I do not think the system we have not is working.
ReplyDeleteI agree with Sean in that there will always be inequality to some degree, but I also think that in a drastic case such as this, something needs to be done about it. We can't expect it to go away completely, but the charts in this article show that inequality is still growing which is very concerning, since the US's wealth distribution is already one of the most top-heavy out of all major economies. The other thing that these charts show is that inequality and mobility, or the lack thereof, are indeed directly correlated. This should be enough evidence to silence the argument that states that the lower classes are lazy, and that's why there's no mobility. It shows that their income doesn't allow them to move up, regardless of how hard they work
ReplyDeleteI must note that having read the article and examined the charts and table I’m not entirely sure that I understand everything. The message that I got from the information really just reiterates common knowledge. There are vast amounts of inequality; the rich keep on getting richer. I find the end statement “the ability for an individual or particular household—to move up or down the income ladder is unrelated to whether the rungs of the ladder are being more widely spread out” to be ludicrous. Surly logic dictates that the more the metaphorical rungs of the ladder are spread out the harder it is to move up the ladder.
ReplyDeleteThis article was confusing. It seemed to have said that we as citizens do not get as much return from taxes. iM still not sure.
ReplyDeleteLike some of the other students, I do not entirely understand this article. But what did stand out to me as somewhat shocking what the fact that the top 20% of income pulled $11,000 on average in transfers from the government. That caught me off guard. I also think that Winship’s view that the ability for and individual or a household to move up or down the income ladder is unrelated to whether the rungs of the ladder are being more widely spread out logically makes no sense to me.
ReplyDelete- Hannah Lamotte
I wish that the data in this chart was explained in a way, which made it more legible for people not working exclusively within the Financial Sector. In retrospect, I found it quite interesting that inflation-adjusted after-tax income for the top 1 percent increased by 200 percent.
ReplyDeleteI found this to be an interesting, but at the same time it was a bit confusing and a little hard to get through. What I got from it was that there will pretty much always have inequality in our society being that the rich are always getting richer while the rest are just about the same.
ReplyDeleteI definitely agree. This article was very hard for me to understand. I felt as though the author was talking circles around me. Had he not stated his main idea ("So, does increased income inequality reduce economic mobility?"), I honestly would have no clue what he was trying to get across. Which is sad, because I read the article twice. However, I get the feeling that had I understood what was going on a bit more, it would have been very interesting. Hopefully this is something we will cover more in depth during class.
DeleteThe ability for an individual to move up or down the income ladder varies. Depending on a persons socioeconomic status, education and simply other qualities of life Even if the top 1 percent were to be removed as the article suggests income inequality would still exist. Even if the high status people were removed, what I was able to take from the article was that there would still be inequality in our society. It is something that seems to be hard to get rid of and something that needs to be worked on every day in order to fix for more of an equal success rate.
ReplyDeleteMolly
There are people who work at a job, and there are people who build the job and have other people work for them. It's a classic tale of the rich getting richer and the poor getting poorer. I was pretty confused at first by the terminology but that's basically the message I got from this, it was not surprising that inequality would be prevalent even if the top 1% wasn't there. I believe inequality will always exist, there are too many variables, too many different types of people controlling the game. Truth is, people will always choose people similar to them, its not a man/women or black/white thing its a people thing, humans kind of suck in that way.
ReplyDeleteThese charts display perfectly how in todays society, the rich are getting richer and how the income gap is widening gradually. - Maulford Smith
ReplyDeleteThis article was difficult for me to understand at first, but the use of the chart and a few rereads made it easier to understand. I think it did a good job in highlighting the inequalities within our society and strengthened the argument by using the charts and showing the change over time. Jessica Glassman
ReplyDeleteThis article did a nice job showing the statistics of income changes over the past 30 years. Additionally, it was able to make note of things that were surprising that someone without expertise in how income changes and transfer changes would not be able to understand. I was most surprised to see that the acceleration of top 1% wages went at a rate of 5 times the rate of the lowest 20% of Americans, showing that not only is income inequality growing, but that its growing faster than if the rates were the same. Much has been made of ceo wages lately in the public debate and this article shows statistical substantiality to those claims of being bad for the United States.
ReplyDeleteI found this article very confusing and just hard to understand overall but I was still able to get that the main point seems to be that the rich are getting richer and the poor are staying poor, surprise. I did, however, find it interesting that those in the highest quintile are still pulling in a large amount of government transfers even though many people, including myself, seem to think that only those at the bottom use these programs. It's actually the "middle class" with the highest amount, not the lowest quintile as many would expect, which might help explain why they are the ones with the smallest economic growth among all the groups. Another interesting and shocking fact from this article is that income inequality does NOT affect economic mobility. I found this very surprising because many people tend to blame the rich for "taking everything" and not giving the ones at the bottom a chance, but if income inequality and economic mobility are not correlated, might that suggest that maybe it's those at the bottom not doing enough to help themselves? -Karen Reyes
ReplyDeleteI think increased income inequality certainly negatively affects economic mobility. If a few people have most of the wealth, there is not much room or wealth for other to strive for or receive.
ReplyDeleteThe one thing that stuck out to me after battling through this difficult to understand article was the last paragraph. The idea that mobility and inequality can be considered two separate entities unaffected by each other is very interesting. In my mind I would think that as mobility increases and becomes easier, inequality would decrease. This is not the case. What can be done to ensure that there is an inverse relationship between mobility and inequality?
ReplyDeleteThe one thing that stuck out to me after battling through this difficult to understand article was the last paragraph. The idea that mobility and inequality can be considered two separate entities unaffected by each other is very interesting. In my mind I would think that as mobility increases and becomes easier, inequality would decrease. This is not the case. What can be done to ensure that there is an inverse relationship between mobility and inequality?
ReplyDeleteTo be honest, I was really confuse while reading these article. First it talks about quintiles, which is a set divided into 5 equal parts I guess. Then it did not give much info about whether there was income- economic mobility within individuals or not. It just stated that there is going to be a research by Scott Winship. I am not that much into economics, so this was kind of new language for me.
ReplyDeleteTo be honest, I was really confuse while reading these article. First it talks about quintiles, which is a set divided into 5 equal parts I guess. Then it did not give much info about whether there was income- economic mobility within individuals or not. It just stated that there is going to be a research by Scott Winship. I am not that much into economics, so this was kind of new language for me.
ReplyDeleteThis article was a little difficult to understand but the main takeaway I got from it was that there is absolutely no relation with moving up or down the income ladder and the space between the rungs of the ladder. I took this statement to mean that as citizens in society we have the ability to place ourselves in any situation financially regardless of how our financial system is built. Yes, income inequality has continued to increase over the years but it is important for citizens to know that your economic position is not guided by this inequality and you can still improve economically if you take the proper steps.
ReplyDeleteWhile this article was not the easiest read, I think I got the main point. Income inequality is a serious problem in this country; the flow of wealth trends almost exclusively upward. The government does not do enough to address this problem, and until they do, it will continue to plague the U.S.-Damarr Gordon
ReplyDeleteI agree with your reading of it and I think that despite the technical complexity of what's being presented, the results are pretty obvious.
DeleteSince I am not an economics major I did not thoroughly understand these charts nor their importance. However, I did find it crazy that some families are subject to live on $15,500 a year, truly showing how wide the inequality gap in America is.
ReplyDelete-Gregory Brown
I found this article a little bit difficult to read ad understand because I do not know much about economics. The author did not present information about whether there was a sure answer about whether income or economic mobility was possible for individuals in this society. Towards the end of the article the author states that mobility is unrelated to whether the gaps between the classes are being more widely spread out.
ReplyDeleteI found this article a little bit difficult to read ad understand because I do not know much about economics. The author did not present information about whether there was a sure answer about whether income or economic mobility was possible for individuals in this society. Towards the end of the article the author states that mobility is unrelated to whether the gaps between the classes are being more widely spread out.
ReplyDelete