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Date:         Sun, 8 Nov 1992 02:42:05 -0400
From:         The Integral Differential <DEMON@DESIRE.WRIGHT.EDU>
Subject:      Re: Who gained what in the 1980s
Comments: To: POLITICS@OHSTVMA.ACS.OHIO-STATE.EDU

>Brett':
>
>How about those of us who earn unde15,000 or $10,000/year?

	Forbes didn't break out the numbers for <15k.  But here is a study
about income mobility that people might find interesting:

The Wall Street Journal, Tuesday, June 2, 1992, Page A2.

Low-Income Mobility Was High in 1980s:
Treasury Study Also Finds Those at Top Tended to Stay There
By David Wessel, Staff Reporter of the Wall Street Journal


  Substantial numbers of low-income Americans moved up the income ladder
in the 1980s, while those who started the decade at the very top tended
to remain there, a new study by Treasury Department economists shows.
  The study, based on income tax data that aren't publicly available,
found that two-third of taxpayers who were in the bottom fifth of all
taxpayers in 1979 had moved up to somewhere in the top 60% of the income
distribution by 1988.  Only 14% were still at the bottom in 1988...
  The Treasury study differs from some others in that it tracks the same
taxpayers from 1979 through 1988.  Because the Treasury has no information
about people with so little income that they don't file income tax returns,
however, the report sheds little light on the fate of the very poorest
Americans....
  The new study examines 14,351 taxpayers who filed returns in every year
from 1979 to 1988 and compares their before-tax income at several points
in the decade...
  To make the top 1% in the Treasury study, a taxpayer had to have income
above $255,351 in 1988 (measured in 1989 dollars).  To make the top 5%,
a taxpayer had to have income above $96,117.
  Most of the taxpayers -- about 65% -- who were among the top fifth of
taxpayers in 1979 managed to remain there throughout the decade, the study
found.  To make that category, a taxpayer had to have income of more than
$73,705.
  In contrast, the study picked up substantial movement -- most of it
upward -- among taxpayers with lower incomes.  Of those taxpayers who
were in the bottom fifth in 1979, 14.4% had climbed all the way to the
richest fifth by 1988, while 14.2% remained at the bottom.
  And among those taxpayers in the very middle of the income distribution,
47.3% moved up between 1979 and 1988 while 19.7% moved down.  The
remainder were in the same category a decade later.  The middle quintile
in 1988 were those taxpayers with incomes between $37,657 and $54,978...
  Because the study looked only aat those taxpayers who filed returns in
all 10 years, it excludes the very young and the very old.  It also
excludes most income that isn't taxable, such as Social Security benefits
received by many Americans.


Table: Up and Down: Income-Group Mobility 1979-1988
Source: Treasury Department

                               Status  in 1988
                  Top 1%  Next 19%  Next 20%  Middle 20%  Next 20%  Bottom 20%
Status in 1979
----------------
Top 1%             47.3%   38.6%      7.7%      3.8%        0.4%      2.2%
Top 2%-20%          5.3    59.4      20.3       9.4         4.4       1.1
Next Richest 20%    0.6    34.8      37.5      14.8         9.3       3.1
Middle 20%          0.4    14.6      32.3      33.0        14.0       5.7
Next Poorest 20%    0.3    10.8      19.5      29.6        29.0      10.9
Poorest 20%         0.3    14.4      25.3      25.0        20.7      14.2

	The columns to the right indicate what % moved into the new quintile by
1988.  Thus 14.4% of the "poorest 20%" in 1979 had moved into the top 20% by
1988.  (Actually 2%-20% as top 1% is a separate column. :)
	Note that the study only includes thost filing income tax returns
during the length of the study.  (They really couldn't include anyone who
didn't :)

>Furthermore, how does this relate to the amount of work done?  Were
>people earning the same amount for the same amount of work, or did
>they have to work more hours and for more or less pay?

	Irrelevant.  (I'm separating the equal pay issue from this as I
consider that another argument entirely.)

>I'm trying to figure out how you derived those figures as well.  I
>think that "gains" are only relevant on certain levels when discussed
>exclusively in terms of finances.  For example, do they take health
>care and other benefits into account?  If someone loses their health
>care benefits, is that reflected in your figures or not?  If someone
>has more annual income now than ten years ago, but are much further{
>in debt, is that a gain?

	The Census Bureau compiled the stats and Forbes did the article.  You'd
have to find out how the census bureau compiles it's numbers.  But my guess
would be that if it's taxable (income, land, etc.) or can be considered an
asset (tax free funds, cars, real estate equity, etc.) the census counted it.
So whether health care was include would depend on whether or not it was pre or
post tax on the paycheck, or simply a free benefit.  Note that the poor's
income is often discounted by half becuase food stamps, welfare checks, AFDC,
etc. are not considered income.

Brett'
Comments: Gated by NETNEWS@AUVM.AMERICAN.EDU