Economic study: Despite claims, the poor are not getting poorer

Discussion in 'Economics' started by Tom B, Apr 26, 2011.

  1. Tom B

    Tom B

    Economic study: Despite Obama’s claim, the poor are not getting poorer

    By Caroline May - The Daily Caller 12:16 AM 04/26/2011

    In his mid-April speech on the budget deficit, President Obama echoed conventional wisdom when he cited the rich are getting richer and the poor are getting poorer as a reason to raise taxes on the wealthy in order to reduce the national debt.

    Research, published at The Journal of Policy Analysis and Management, from Cornell economist Richard Burkhauser, Joint Committee on Taxation economist Jeff Larrimore, and Indiana University economist Kosali Simon, however, suggests that the president’s piece of conventional wisdom isn’t entirely accurate. According to the findings, while the rich have indeed been getting richer, for the last 30 years so too have the poor and middle class.

    Burkhauser told The Daily Caller that Obama’s suggestion that the poor are getting poorer understates the amount of income to which Americans actually have access. The president does not take into account, Burkhauser explained, tax unit shifts, government transfers, and other sources of income such as health care benefits.

    “The bottom line is [conventional wisdom] asks what’s been happening to private personal income over time and they are right if you look at that for tax units, things do not look very good for the middle class,” he said. “But if you take other things into account, the reason the country has not gotten in a civil war is because things are not that bad. In fact everybody has done better.”

    Burkhauser’s research shows what has actually been happening to the lives of Americans over the last thirty years — not just counting the amount of money individuals made in the market, but the actual income that people get in their hands to spend.

    “This isn’t a zero sum game, where one group wins at the expense of others,” Burkhauser said. “The growth in productivity of Americans in the top twenty percent of tax units increased the size of the economic pie sufficiently to register major gains across the entire distribution of after-tax income.”

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    http://dailycaller.com/2011/04/26/e...obamas-claim-the-poor-are-not-getting-poorer/
     
  2. Did something happen to the economy after 2007 or did we miss something?

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  3. lol, more "massaged statistics at work".
     
  4. AK100

    AK100

    Ahhhh, the rich telling the poor they're not actually as poor as they really are.

    Got to love these sorts of studies. Wonder if they have the arrogance to think they know what it's like to be poor in America or whether they prefer to rely on their figures and stats. Doing it that way is far 'cleaner' as they won't even have to talk to them......