Politicians and media talking heads love to refer to people who are in the bottom 20 percent in income in a given year as "the poor." But, following the same individuals for 10 or 15 years usually shows the great majority of those individuals moving into higher income brackets.
The number who reach all the way to the top 20 percent greatly exceeds the number still stuck in the bottom 20 percent over the years. But such mundane facts cannot compete for attention with the moral melodramas conjured up in politics and the media when they discuss "the rich" and "the poor."
There are people who are genuinely rich and genuinely poor, in the sense of having very high or very low incomes for most, if not all, of their lives. But "the rich" and "the poor" in this sense are unlikely to add up to even ten percent of the population.
Ironically, those who make the most noise about income disparities or poverty contribute greatly to policies that promote both. The welfare state enables millions of people to meet their needs with little or no income-earning work on their part.
Most of the economic resources used by people in the bottom 20 percent come from sources other than their own incomes. There are veritable armies of middle-class people who make their livings transferring resources, in a variety of ways, from those who created those resources to those who live off them.
These transferrers are in both government and private social welfare institutions. They have every incentive to promote dependency, from which they benefit both professionally and psychically, and to imagine that they are creating social benefits.
For different reasons, both politicians and the media have incentives to spread misconceptions with statistics. So long as we keep buying it, they will keep selling it.
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