For ages now I’ve been saying that the gap between rich and poor in the US is widening, and that the financial prosperity that the country claims to have is mostly possessed by the wealthy.
In short: I’ve been arguing that when things are bad the poor pay for it, and when things are good only the rich benefit.
So you can imagine my surprise when I was looking around Wikipedia and came across this:
This graphic shows the change in personal income over the past 40 years (1965-2005), and it appears to show that, actually, everything is fine in the US. It seems as if things for everyone have been steadily improving, and that things have been improving for everyone at roughly the same rate.
Take a few minutes, stare at the graph, and see if you can work out why this supposed trend is actually complete and total bullshit.
Seriously, just try.
Ok, times up.
If you thought that the answer was that the really poor people in America aren’t even listed on the graph because those stats are based on IRS returns and the poor don’t file any then you have earned yourself a snack! Good work.
If you said that it’s because the really rich people in the US make so much money that $160 000 a year is actually laughably small, then good work too! Just don’t hurt yourself patting yourself on the back.
But none of those answers was the one I was looking for: scale.
Look at the left hand column. The income numbers don’t have any kind of regular separation, like 1, 2, 3, 4 etc.
Instead the number doubles each time: 5, 10, 20, 40 , 80, 160.
What this biased scale does is it makes it look as if the difference between the top and the bottom are the same, when they’re not. The bottom 10% have increased their income from about $7500 to about $10000, an increase of roughly $2500. The people in the top 1% have doubled their income from roughly $80 000 to roughly $160 000! This is an increase of 30 times as much.
Now, I can already hear sceptical individuals talking about how it’s wrong to compare actual monetary increases between groups that are so fiscally disparate. In other words that it’s ridiculous to think that a group that made $5000 could somehow manage to gain $80 000, even over 40 years. This is true, but what I’m talking about is a trend that I believe this graph is obscuring.