Now train your eyes on the percentage of families earning more than $75,000. In constant dollars, these have risen from 12 percent in 1980 to 18.4 percent in 1997. That means, correlatively, that to be counted in the top 5 percent now requires $l45,000 per year, where in 1988, $92,000 would elevate you there. The impression will be that the earnings are rising precipitately. But that is a statistical illusion; because any top-income group has no ceiling, a few huge incomes can also grossly exaggerate the average at the top.
What we suffer from is the absence of truly reliable practical information. A learned tax specialist said it all, ruminating on a conversation with an old friend, a classmate. "He lives in the Midwest and does cataract removals. Three hundred every -- I forget, every week, every month, every year. He nets $1 million." How is it that the market permits/tolerates that? How much administrative cost is necessary to our system of public health? How would the application of fluctuating deductibles affect the burden of medical costs?
These are intelligent concerns, and not much light is shed on them by rich/poor talk, let alone talk that suggests that the rich get that way by burdening the non-rich. Deep veins of thought and inquiry run through the economic system, but not much light is coming through in the high holy days of democratic practice.
Caspar Weinberger was appointed "director of finance" for the state of California by Ronald Reagan. A year later he was swept up by Richard Nixon. After that, he went to war as head of the Department of Defense. He has much to tell us.