Re: [Phys-l] taxes (was SOLAR , NUCLEAR ENERGY etc.)

[John Mallinckrodt <ajm@csupomona.edu>]

On Apr 14, 2009, at 6:17 PM, Brian Whatcott wrote:

> Using 2004 data, it appears that the bottom 99% tax payers shared  
> 47% of
> gross domestic product; so I assume the top 1 % tax payers acquired  
> 53%
> of the GDP.
> This according to a sequence of 22 slides (I am citing #8) from  
> this URL:
> <http://www.slideshare.net/cmulbrandon/income-distribution-in-the- 
> united-states>
> (I cannot vouch for the dataset.)

As effectively as it would seem to make my point, the data set is  
surely in error.  The CBO says that in 2004 the top 1% took 16.3% of  
all income and the top 20% took 53% of all income.  See

   http://www.cbo.gov/publications/collections/tax/2007.cfm

I should also mention that the CBO data does not quite agree with the  
Tax Foundation data that I quoted yesterday.  Although it is simply  
undeniable that there has been a MASSIVE "redistribution of wealth"  
FROM the poor TO the wealthy in recent decades, the CBO says that the  
wealthiest 1% "only" increased its share of all income by a factor of  
2 (from about 9% in 1979 to about 18% in 2005.)  Over the same  
quarter century the lowest 20% saw its share decrease by about 30%  
(from 5.8% to 4.0%) and the lowest 80% has seen its share decrease by  
about 17% from 54.8% in 1979 to 45.6%.

I do agree with Rick Tarara, however, that some absolute numbers are  
necessary here for the sake of objectivity.  After all, just because  
their share of the pie decreased, poor people still might have done  
better in absolute terms.  (What's that saying? "A rising tide lifts  
all ships"?)

Unfortunately, jus t'aint so.

From 1979 to 2005 the lowest quintile saw essentially NO net change  
in their average REAL pretax income ($15,900)  Even the middle  
quintile saw only a 15% increase from $51,000 in 1979 to $58,500 in  
2005.  On the other hand, the top 1% saw their average income  
increase by a FACTOR of three from just over a half million in 1979  
to over one and a half million in 2005 (and again in REAL dollars.)

>    But watching Physicists with econometric data is to say the least,
> instructive......    :-)

Indeed.  I just wish more of us felt bound to respect the data!

John Mallinckrodt
Cal Poly Pomona