The bottom also has more young heads of households ages 15 to 24 — 10 percent versus 1.1 percent for the top.
In another NCPA study , economist Andrew Rettenmaier discovered that there is enormous mobility in the U.S. economy — with people moving up and down the economic ladder over short periods of time. For example, within 10 years most people who start out in the bottom fifth have moved up, with almost 1 in 10 (8%) moving all the way to the top. The reverse movement is similar. Within 10 years, most of those who started in the top fifth have moved down, with more than 1 in 20 (6%) moving all the way to the bottom.
Last week I alerted readers to the fact that most rhetoric about income inequality is wrong. Virtually every major Republican tax bill in modern times has made the tax code more progressive — as the burden of taxation has consistently been shifted to higher income taxpayers. In fact the United States now has one of the most progressive tax systems of industrialized countries. Also, freer economies produce more equal incomes and they tend to confer their greatest rewards on those at the bottom.
But the more important point is that the entire obsession about unequal incomes is misplaced. As David Henderson explains:
The income distribution should be judged not by how equal it is, but by how people obtained what they have. Inequality due to government-granted privileges, in the form of subsidies, quotas and so forth, is arbitrary and unfair, while inequality due to income earned through work and investment is just.
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