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The Rise and Consequences of Inequality in the United States: charts

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Charts prepared for a speech by Alan B. Krueger, Chairman of the Council of Economic Advisers, on January 12, 2012 at the Center for American Progress

Charts prepared for a speech by Alan B. Krueger, Chairman of the Council of Economic Advisers, on January 12, 2012 at the Center for American Progress

Published in Economy & Finance , Technology
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  • THIS IS THE UNITED STATES OF AMERICA 45TH & 46TH PRESIDENT ARLENEA BALLARD(MARIE)23978554917479-79-44726491-756489-456274-9161-89-816492 & CHIEF OF MESA LIC#246189, NEW YORK LIC#446192 POLICE AS WELL AS THE CHIEF OF THE SHERRIF'S DEPARTMENT LIC#24716472 BENCH WARRANT I WOULD LIKE THIS WARRANT TO BE ISSUES TO OBAMA BARACK. WARRANT NO.74926793 SUBPOENA NO.471769764756191. COURT ORDER NO.447261-FBI AGENT GEORGE MASON MURRAY YOU HAVE BENCH WARRANT FOR YOUR ARREST. BENCH WARRANT NO.44718192647174 & SUBPOENA NO.44719391-7492 & COURT ORDER NO.9710891. REQUESTING PICK-UP AND ESCORT NOW OR JAIL TIME!!!!!!!!! FORMER PRESIDENT OBAMA BARACK & FBI AGENT BISHOP: GEORGE MASON MURRAY.
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  • PICK-UP & ESCORT THE UNITED STATES OF AMERICA PRESIDENT ARLENEA BALLARD(MARIE)-CONFIRMATION :222-4476291. PICK-UP & ESCORT-1744391-772757191-89-81 UNITED STATES OF AMERICA 45TH & 46TH PRESIDENT ARLENEA BALLARD(MARIE)-@4PM PAZ DE CRISTO TODAY 4/27/2014 MESA ARIZONA.CENTRAL STANDARD TIME.U.S PRESIDENT ARLENEA BALLARD(MARIE).-6895.
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  • I would love to see an overlay of 1870-1950 to this chart to see if the present day trend is similar to the 1920s. is there a report with that sort of comparison somewhere?
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  • After read the last slideshares about figures, I connect two ideas, with this presentation, You could take the public works (about the bridges which needs maintenance, and new jobs) as a source of new jobs. Meanwhile you invest in SME's and micro-enterprises.
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  • @AmbassadorHope The credit issue I do consider essential and has been a problem for a long time. When I helped organize a silicon valley startup, OST, we had a business model that tended to generate a high accounts receivable, eventually growing to the 50K+ range each month, which is rather large for a small enterprise.

    Each year we were rather profitable, but we could not secure financing for that ar. Banks were only interested if we wanted to borrow 1 to 10 million, not say 100K. We ended up carrying it on credit cards each year because there was no other option available, and this of course was not very sustainable. So in 2005 we finally had to close, and 8 people became unemployed, not because the market failed for us, or our products were wrong, or that we could not grow, but simply because we could not secure credit to meet continuing business needs.

    Credit though is only one issue. Unlike my generation, who had looked at places as Silicon valley as the future and 'the place to be', when I speak with younger people today, they speak with the same excitement and wistfulness about Taipei Towers. Those working now try to get themselves there any way they can. That is where many of the new generation of the best and brightest now see the future. And business credit is just one part of the problem.

    A lack of industrial policy, and a political culture that now clearly favors the law of rule over the rule of law also drives what is clearly becoming a growing exodus. I am quite familiar with this as well. While I have found no support nor opportunity for developing anything original in your United States in almost a decade now, some of my ideas, including how to change delivery of emergency medical services, have already been openly embraced and adopted by both national governments and commercial entities elsewhere. Your United States is truly destroying it's future to protect present entrenched interests, and I think it will take much more than a simple executive order to fix that.
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  • 1. The Rise and Consequences of Inequality Alan B. Krueger Chairman Council of Economic Advisers January 12, 2012
  • 2. Figure 1: Growing Together, Growing Apart Income Growth by Quintile, Various Periods Annual Growth Rate of Real Income Across the Family Income Distribution Annual Growth Rate of Real Income Across the Family Income Distribution Percent 1947 to 1979 Percent 1979 to 20103.5% 3.5%3.0% 3.0% 2.5%2.5% 2.4% 2.4% 2.5% 2.2% 2.2%2.0% 2.0%1.5% 1.5% 1.2%1.0% 1.0% 0.6%0.5% 0.5% 0.3% 0.1%0.0% 0.0% Lowest fifth 2nd fifth Mid fifth 4th fifth Top fifth -0.5% -0.4% Lowest fifth 2nd fifth Mid fifth 4th fifth Top fifth Source: Census Bureau January 12, 2012 1
  • 3. Figure 2: Growing Together Again 1992-2000 Annual Growth Rate of Real Income Across the Family Income Distribution Percent 1992-2000 4.0% 3.5% 3.5% 3.0% 2.6% 2.5% 2.0% 2.0% 1.9% 1.8% 1.5% 1.0% 0.5% 0.0% Lowest fifth 2nd fifth Mid fifth 4th fifth Top fifth Source: Census BureauJanuary 12, 2012 2
  • 4. Figure 3: If Real Incomes Had Grown During the 2000s as They DidDuring the 1990s, the Median Household Would Have an Extra $8,900 in Annual Income in 2010 Median Household Income 2010 Dollars 60,000 If median household income had 58,000 grown during the 2000s at the same rate as it did during the 1990s 56,000 54,000 $8,900 52,000 50,000 2010 48,000 Actual 46,000 44,000 42,000 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 Note: Shading denotes recession. Source: Census Bureau; CEA calculations January 12, 2012 3
  • 5. Figure 4: CBO Estimates Show Much Faster Income Growth for the Top 1% Growth in Real After-Tax Income, 1979-2007 Percent Change 300% 278% 250% 200% 150% 100% 65% 50% 43% 35% 28% 18% 0% Lowest Quintile Second Quintile Middle Quintile Fourth Quintile 81st-99th Top 1 Percent Percentiles Source: CBO January 12, 2012 4
  • 6. Figure 5: Income Inequality Near Record High Share of Income Earned,1916-2009 Percent of All U.S. Income 25 20 15 Top 1% 10 5 Top 0.1% 0 1916 1926 1936 1946 1956 1966 1976 1986 1996 2006 Source: 2010 update to Piketty and Saez (2006)January 12, 2012 5
  • 7. Figure 6: The Size of the Middle-Class has Fallen Percent of Households With Annual Income Within 50% of the Median Percent 52 50.3 50 48 47.3 46 45.6 44.2 44 42.2 42 40 0 38 1970 1980 1990 2000 2010 Source: CEA Calculations from Current Population SurveyJanuary 12, 2012 6
  • 8. Figure 7: “The Great Gatsby Curve”Higher income inequality associated with lower intergenerational mobility . The Great Gatsby Curve Intergenerational earnings elasticity 0.6 0.6 0.5 United Kingdom 0.5 United States 0.4 France 0.4 Japan Germany 0.3 0.3 New Zealand Sweden y = 2.2x - 0.27 R² = 0.76 0.2 Finland 0.2 y = 2.2x - 0.27 Norway R² = 0.76 Denmark 0.1 0.1 0.15 0.20 0.25 0.30 0.35 0.40 Inequality (1985 Gini Coefficient) Source: Corak (2011), OECD, CEA estimates January 12, 2012 7
  • 9. Figure 8: “The Great Gatsby Curve”: Projection . The Great Gatsby Curve Intergenerational earnings elasticity 0.6 0.6 United States (2010) 0.5 United Kingdom 0.5 United States 0.4 France 0.4 Japan Germany 0.3 0.3 New Zealand Sweden y = 2.2x - 0.27 R² = 0.76 0.2 Finland 0.2 Norway Denmark y = 2.2x - 0.27 R² = 0.76 0.1 0.1 0.15 0.20 0.25 0.30 0.35 0.40 Inequality (1985 Gini Coefficient) Source: Corak (2011), OECD, CEA estimatesJanuary 12, 2012 8
  • 10. Figure 9: Causes of Higher Inequality Box-5-3.─The Experts Consensus on Earnings Inequality Average percent distribution 50 40 30 20 10 0 Technological Other and International Decline in real Decline in Rising change unknown trade minimum wage unionization Immigration Source: Economic Report of the President, 1997January 12, 2012 9
  • 11. Figure 10: U.S. Tax Code is Less Progressive than Most Other OECD Countries Gini Coefficient Before and After Taxes and Transfers, 2010 0.6 Before tax After tax 0.5 0.4 0.3 0.2 0.1 0 Source: OECD January 12, 2012 10
  • 12. Figure 11: Despite large tax cuts, less dynamism Startup Employment as a Share of Total Employment Percent 3.5 OBRA Deficit Balanced JGTRRA Reduction Act Budget Act EGTRRA 3.3 3.0 Average: 1993-2000 2.8 Average: 2001-2007 2.5 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 Source: Business Dynamics StatisticsJanuary 12, 2012 11
  • 13. Consequences • Intergenerational Mobility • Consumption • Aggregate demand and excess leverage. • Economic Growth • Morale and ProductivityJanuary 12, 2012 12
  • 14. The Rise and Consequences of Inequality Alan B. Krueger Chairman Council of Economic Advisers January 12, 2012