The core argument of the Occupy movement and its Obamacrat friends is this: The rich stole all the money. That explains why over the past four decades, the income of the broad American middle class supposedly has stagnated even as the economy expanded. Why? Did you forget already? The rich stole all the money. And now it’s time to take it back.
And here are the numbers behind that claim, as calculated by the University of Chicago’s Tino Sanandaji (an absolute must-follow blogger, too): Between 1970 and 2008, real per capita GDP increased by 108 percent (based on national accounts data calculated by the Bureau of Economic Analysis). But according to economists Thomas Piketty and Emanuel Saez — favorites of inequality alarmists — the taxable income of the bottom 99 percent increased by just 12 percent. So the real GDP per person doubled but middle class incomes barely budged? Income inequality must be the culprit. The rich stole (nearly) all the money.
But, as Sanandaji points, Piketty and Saez dramatically underestimate income growth during the period, finding that real average taxable income for everyone grows by just 29 percent.