Disinformation on Inequality
Paul Krugman, NYT
Miles Kimball catches Bret Stephens pulling a fast one on Wall Street Journal readers – but it’s much worse than Kimball says.
Kimball take Stephens to task for overstating the economic progress of poorer Americans by presenting nominal figures, without any adjustment for inflation. What Kimball doesn’t mention is that the constant-dollar figures are presented by the Census in the same table (Excel file) from which Stephens is taking his numbers – and the constant-dollar figures actually show a small decline in the incomes of the bottom 20 percent.
Wait, it gets worse. In the same piece in which he commits the unforgivable sin of using nominal incomes as a measure of progress, Stephens also accuses President Obama of a “factual error” in claiming that the top 10 percent receive half the income; it’s the top 20 percent, says Stephens, and there has been no significant rise since the mid-1990s.
What’s going on here? Stephens is citing the Census data, which everyone who knows anything about inequality knows has a problem with very high incomes thanks to “top-coding”. The Piketty-Saez data, which use tax returns to estimate income shares, do indeed show the top 10 percent receiving half the income, up from 42 percent in 1995. Maybe you don’t like those estimates, but Obama made no mistake – while Stephens did.
(More here.)
Miles Kimball catches Bret Stephens pulling a fast one on Wall Street Journal readers – but it’s much worse than Kimball says.
Kimball take Stephens to task for overstating the economic progress of poorer Americans by presenting nominal figures, without any adjustment for inflation. What Kimball doesn’t mention is that the constant-dollar figures are presented by the Census in the same table (Excel file) from which Stephens is taking his numbers – and the constant-dollar figures actually show a small decline in the incomes of the bottom 20 percent.
Wait, it gets worse. In the same piece in which he commits the unforgivable sin of using nominal incomes as a measure of progress, Stephens also accuses President Obama of a “factual error” in claiming that the top 10 percent receive half the income; it’s the top 20 percent, says Stephens, and there has been no significant rise since the mid-1990s.
What’s going on here? Stephens is citing the Census data, which everyone who knows anything about inequality knows has a problem with very high incomes thanks to “top-coding”. The Piketty-Saez data, which use tax returns to estimate income shares, do indeed show the top 10 percent receiving half the income, up from 42 percent in 1995. Maybe you don’t like those estimates, but Obama made no mistake – while Stephens did.
(More here.)
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