Not so, says Steven Horowitz.
The bottom line is that income mobility is alive and well and seems pretty consistent regardless of who is president or who controls Congress. The underlying market processes appear to be doing well at enabling a majority of those who start out poor to move up the income ladder within a decade or less.
. . .
As good as these results are, allow me to steal from a favorite source of mine and say "just think what we might do" if those market processes were even freer to work their magic.
Well, there certainly is a coordination problem if you try to balance that with this recent post at G&T.
Can it really be true that: "Of those taxpayer households in the lowest quintile of income in 1999, 57.5% had moved up at least one quintile by 2007 and over 30% jumped two quintiles or more."
This is wildly inconsistent with not only the great spread in wealth disparity, but also with anemic GDP growth, dismal job creation, and increasing poverty levels over the period. It also suggests the number in the lowest quintile should be declining, which I'm pretty sure is not the case.
Something seems terribly wrong here. Can anybody explain this?