Ninety-Five Percent Left Behind?

What does it mean to be "left behind?"  By one simple definition, you have been left behind if the economy as a whole is growing faster than your own income.  A discussion of the actual numbers is after the jump.  But by that measure, those people in the 95th percentile income bracket easily qualify (as a quick definition, if you are in the 95th percentile, you made more money than about 94 percent of the population), at least in the period 2001 - 2008 (during the George W. Bush administration).

What has been happening is that the lion's share of the growth in the U.S. economy has been captured by a very small percentage of the population, leaving no benefits of growth for anyone else.

It was not always this way, and it is not this way in other advanced countries.  Most income groups did better during the Clinton Administration (1993-2000), for example, as will be discussed after the jump.  Thus, claims that this is a natural consequence of how economies work, or that it has to be that way because of international competition, do not withstand scrutiny.

It is quite possible to quibble with the numbers, but if you are left with resorting to quibbling (as in, "Ha!  You're completely wrong!  Only 94 percent of us have been left behind!"), then you must concede the basic thrust.

How often are we told that there is very little that the government can do for the economy, by the very people who are simultaneously working furiously to get the government to benefit them (and succeeding in a spectacular fashion)?  There are in fact many policy choices that a government makes that can have profound impacts on how the economy does, and how equitably growth is distributed.

That is what this blog will explore.