Sylvia Nasar (May 11, 1992): The Richest Getting Richer: Now It's a Top Political Issues https://www.nytimes.com/1992/05/11/business/the-richest-getting-richer-now-it-s-a-top-political-issue.html: "When Bill Clinton wants to galvanize his audience, he thunders from the podium that the top 1 percent of families got 60 percent of the gains from economic growth during the 1980's and owns more wealth than the bottom 90 percent. Governor Clinton, the likely Democratic Presidential nominee, had been searching for months for facts to illustrate his claim that America's middle class benefited little from 12 years of Republican rule. The explosion of riches at the top struck him as a perfect vehicle. Not only did the widening gap between the rich and the rest of Americans conflict with traditional notions of democracy, but it also went right to the pocketbook sources of middle-class discontent...

...'He was reading the paper that morning and went crazy', said Dee Dee Myers, the campaign's press secretary, referring to an article in The New York Times on March 5 that reported on the wildly disproportionate gains of the top 1 percent. 'The story proved a point he had been trying to make for months, so he added the statistic to his repertoire.'... Mr. Clinton is one of the few Presidential candidates since Harry S. Truman to woo the middle class by pummeling the rich.... The furor over the rich getting richer infuriates Republicans.... The Joint Economic Committee's annual minority report accuses Democrats of using Joseph Stalin's approach to rewriting history. Supply-side architects of the Reagan tax cuts blasted the figures as 'propaganda, not data'. Even the President's notably unemotional economic adviser, Michael J. Boskin, said he was livid. The White House itself took the unusual step of delivering an editorial response signed by the President's counselor for domestic policy, Clayton K. Yeutter. The piece, which ran on the Op-Ed page of The Times on March 24, stressed that everybody gained from the 1980's economic expansion.

Oddly, when the Congressional Budget Office first released its income data—the numbers that are now being hurled on the hustings—only a handful of Congressional aides and professional economists paid much attention. And even after the economist Paul R. Krugman of the Massachusetts Institute of Technology crunched the numbers and concluded that the major share of the gains in average family income between 1977 to 1989 had gone to the richest of the rich, he had trouble getting anyone to listen. But Mr. Krugman's arithmetic ultimately crystallized the issue....

Mr. Boskin said, 'While there has been some increase in inequality in the last two decades, it is far less than some people allege, and its causes—primarily demographic and labor market shifts—have little to do with economic policy. Krugman's 70 percent calculation is not the answer to meaningful questions you'd want to ask'.... Besides, Republicans say, measuring income shares in a mobile society is as meaningless as measuring which bubbles are at the top of the blender at a given moment in time. 'The whole concept of a static layered society is false except for the underclass'....

While no single calculation represents the truth and every data set has drawbacks, Mr. Krugman and others said, a large number of different measures using different data sources show that the very rich have done far better than everyone else. Take wages. "There is complete unanimity on the facts," said Lawrence H. Katz, an economist at Harvard University. Finis Welch, an economist at the Rand Corporation and the University of California at Los Angeles, said, "The farther up you were the more you gained; the farther down you were, the more you lost."

The fact is that even before Mr. Krugman rolled his grenade under the tent, the Republicans had recognized inequality as a potential political bombshell and had attempted to defuse it. Two out of nine chapters in this year's Economic Report of the President, for example, tackled the touchy topic. Though the report acknowledges that the well-off gained more than anyone else, that poverty was higher in 1989 than in 1979, and that the income prospects of families headed by younger and less-educated workers were dismal, its main emphasis is on overall growth, rather than on how much more some benefited than others. 'It's much more important for economic policy to promote growth in family incomes than to redistribute it', Mr. Boskin said. But some conservatives are fuming because of what they see as the White House's wimpishness on this issue. 'The White House is terribly ill suited to take this issue on', said a Republican aide who spoke on the condition that he not be named. 'Who's going to fight the fight over fairness? Nicholas Brady? Robert Mossbacher? George Bush? Dan Quayle? There's no one there who comes from the middle class'...


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