Return with us now to those thrilling days of yesteryear. If FT Alphaville is right, you were probably better off financially in 1998 than you are now:
The median American family was richer in 1998 than it is now, and it also has about 30 per cent less wealth than at its peak in 2007. That measurement was obviously inflated by the housing price bubble, but even so the decline can nonetheless be understood as a massive shock to the value, real and perceived, of the typical household’s collateral. Other methodological approaches, perhaps using a different deflator, might yield a more hopeful trend, but the devastation wrought by the crisis remains hard to overstate.
but it was the graph at the top of this post that caught my eye. Note how nicely it explains a point I’ve made here repeatedly, that if you’re worried about income inequality you should be as worried as much about the top 2-9% of income earners as about the top 1%. The subsidies received by that group are enormous and their lobbying is commensurate with their subsidies.
When you have a small group of people at the top deciding what to produce, when and how to invest, when and who to employ and what to do with the surpluses generated in the production process, you usually get outcomes that are not so good for most people.
But, remarkably, the outcomes always turn out well for the small group, their friends, and their families.
Maybe we should call them , the Politbureau.
My sister, in secretarial positions for years, took a punch to her retirement account in the crisis. You don’t countenance the kind of language I reserve for those people at this distinguished site.