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If you're talking about the US this is a popular misconception. The number of rich and poor people does stay the same from generation to generation. But the pe
by uuilly 16y ago
If you're talking about the US this is a popular misconception. The number of rich and poor people does stay the same from generation to generation. But the people themselves move very fluidly through these brackets. One of the best predictors of income bracket is age. Young people are much more likely to be poor but they seldom remain poor. As they gain more experience they become more valuable and pull themselves out of poverty. Likewise many people with medium and large amounts of money lose it and become poor. Saying, "In 1990 10% of the US is poor and in 2010 10% are still poor" is pretty silly if most of 1990's poor are different people than 2010's poor.
Tracking flesh and blood people through time using tax returns from the IRS yields dramatically different conclusions than tracking buckets of people using Census data. I'd like to do a visualization of income bracket churn in the US. From what I've read I imagine it would look roughly like this:
http://www.nytimes.com/interactive/2008/02/23/movies/20080223_REVENUE_GRAPHIC.html http://www.nytimes.com/interactive/2008/02/23/movies/2008022...
Also Thomas Sowell has written extensively on this exact subject. Here is an article about this misconception that is a lot more elegant than this comment:
http://www.realclearpolitics.com/articles/2007/11/income_confusion.html http://www.realclearpolitics.com/articles/2007/11/income_con...
- ahi 16y agoKrugman, among many others, disagrees. See: http://www.huppi.com/kangaroo/L-mobility.htm http://www.huppi.com/kangaroo/L-mobility.htm and http://www.bnet.com/blog/financial-business/as-income-mobility-falls-american-dream-fades/1160 http://www.bnet.com/blog/financial-business/as-income-mobili... Tracking flesh and blood people is a poor methodology as all but a handful of trust fund kids start at the bottom and work up.
- andyv 16y agoKrugman thinks that Social Security is on financially sound footing...
- te_chris 16y agoprove him wrong?
- nickpinkston 16y agoThis'll do: http://www.cbo.gov/doc.cfm?index=5530&type=0 http://www.cbo.gov/doc.cfm?index=5530&type=0
- Locke1689 16y agoNo it won't. There's no context there.
- nickpinkston 16y agoCBO = Govt's Auditer, That graph = range of outlays they predict (best/worst), if CBO is unbiased OR biased towards govt AND best_case_outlays > revenue -> social security will blow up under current laws. $: True
- Locke1689 16y agoI know what the CBO is and I know how to read outlays. The economic impact is far more complex than the simplistic analysis that you have presented. The Social Security Administration also projects that the situation will stabilize. They suggest that, instead of complete Social Security reform, the payroll tax simply go through a graduated increase ending in 2081. Krugman's main criticism with this math is that GDP growth projections are needlessly pessimistic, meaning that the revenue projections are also pessimistic. Either way, he is not arguing against all change to Social Security, he is arguing against the loudest voices that are constantly screaming that Social Security is a giant disaster that will tear the govt down in flames. When I asked for context I wasn't asking for what the CBO is, I was asking for what the economic assumptions (of which there must be many) the CBO made. I was also asking for the context of the outlay in respect to the rest of the government debt and budget.