[T]wo decades after the promise that lowering tax rates and reducing regulation would benefit everyone, the income gains were flowing straight up to the top of the income ladder. Even the derisive description by critics captured in the phrase "trickle-down economics" was not proving out. At the bottom there was less money for food, shelter and clothing. Four out of five Americans were making less or were no better off in 2000 than in 1970.
People in the middle class and even those making more than 95 percent of their fellow Americans were working harder than ever and going nowhere fast. For those on the ninetieth rung of the ladder, average income in 2000 was $90,271, which, after adjusting for inflation, was a one-fourth increase from the $72,320 in 1970. In real terms incomes for those on the ninetieth rung rose at less than 1 percent per year, which was far less than the rate of growth in the economy.
Those at the ninetieth rung saw their incomes rise at an annual average of less than $600 per year, compared to about $4,600 annually at the ninety-ninth rung and more than $672,000 annually for the top group, those 13,400 super-rich families.
[The first chapter is available at NYTimes.com]
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