- by New Deal democrat
Berkeley Professor Emmanuel Saez has updated his comprehensive tax return data through 2013, showing real average incomes of the bottom 90% vs. the top 10%, 5%, and 1%. From Justin Wolfers in the New York Times:
[With regard to t]he income share of the richest 1 percent of American families[,] Emmanuel Saez, the economics professor who crunches these numbers based on data provided by the Internal Revenue Service, has just released preliminary estimates for 2013. The share of total income (excluding capital gains) going to the top 1 percent remains above one-sixth, at 17.5 percent.
[Because of income shifting from 2013 to 2012 due to the "fiscal cliff," it is f]ar better instead to focus on the average of the past two years. That average supports the narrative that the economic recovery so far has only boosted the incomes of the rich, and it has yielded no improvement for the bottom 99 percent of the distribution. After adjusting for inflation, the average income for the richest 1 percent (excluding capital gains) has risen from $871,100 in 2009 to $968,000 over 2012 and 2013. By contrast, for the remaining 99 percent, average incomes fell by a few dollars from $44,000 to $43,900.
Here's a link to the critical spreadsheet. This is income for tax units (similar to but not identical to households). The real average income for all tax filers is the first column. The real average income for the bottom 90% is the 8th column of data. I've listed the most critical years below (first column is all tax units, the second is the bottom 0-90%):
2000 $63,649 $37,053
2007 $65,228 $36,426
2009. $53,860 $32,019
2013. $55,470 $31,652
Remember this is real, inflation-adjusted data. It is the average rather than the median.
The bottom line here is the same as for just about every other study since 2009. Wages have stagnated, and due to the increase in gas prices from $1.60/gallon in 2009 to nearly $4/gallon in 2011-13, real incomes declined slightly during that time, while due to a soaring stock market, the wealthy, who disproportionately own stocks, saw their income soar as well.
Saez' research is exhaustive, compiling tax return data. A drawback, however, is that now in January 2015, we are only able to see the data for calendar year 2013. Here's Saez's graph of annual real average income from 1913 through 2013 of the bottom 99%:
Thus it is noteworthy that Saez' data is very similar to that in the monthly updates starting from the late 1990s through last month by Sentier Research, and eloquently graphed by Doug Short. Here's Sentier's graph:
So it is a fair supposition that a year from now, Saez's more comprehensive update for 2014 will show a similar increase to that we have seen in the Sentier Research. That's good news. The bad news, of course, is that even so, income inequality is the worst in nearly a century.