Some Data for Krugman
27 November 2007
The Editor, New York Times
229 West 43rd St.
New York, NY 10036
To the Editor:
Paul Krugman continues his drumbeat message that ordinary Americans are stagnating economically ("Winter of Our Discontent," November 26). But data that he frequently cites (especially from economists Thomas Piketty and Emmanuel Saez) are not of real flesh-and-blood persons through time; they are of statistical categories such as deciles or quintiles of income earners. Changing demographics and movements of persons from quintile to quintile mask potentially huge changes in the underlying reality.
Sure enough, recent data from the IRS that are of real-life persons reveal that ordinary Americans are prospering. Economist Thomas Sowell summarizes some germane revelations of these data: "People in the bottom fifth of income-tax filers in 1996 saw their incomes rise 91 percent by 2005. The top 1 percent ... saw their incomes decline a whopping 26 percent. Meanwhile, the average taxpayers' real income rose 24 percent between 1996 and 2005."*
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
* http://www.washingtontimes.com/apps/pbcs.dll/article?AID=/20071123/COMMENTARY07/111230045&template=printart
The Editor, New York Times
229 West 43rd St.
New York, NY 10036
To the Editor:
Paul Krugman continues his drumbeat message that ordinary Americans are stagnating economically ("Winter of Our Discontent," November 26). But data that he frequently cites (especially from economists Thomas Piketty and Emmanuel Saez) are not of real flesh-and-blood persons through time; they are of statistical categories such as deciles or quintiles of income earners. Changing demographics and movements of persons from quintile to quintile mask potentially huge changes in the underlying reality.
Sure enough, recent data from the IRS that are of real-life persons reveal that ordinary Americans are prospering. Economist Thomas Sowell summarizes some germane revelations of these data: "People in the bottom fifth of income-tax filers in 1996 saw their incomes rise 91 percent by 2005. The top 1 percent ... saw their incomes decline a whopping 26 percent. Meanwhile, the average taxpayers' real income rose 24 percent between 1996 and 2005."*
Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University
* http://www.washingtontimes.com/apps/pbcs.dll/article?AID=/20071123/COMMENTARY07/111230045&template=printart
Posted by Don Boudreaux on
Monday May 12, 2008 at 12:38pm