Several stories can be told from this chart. One of them, explored in this NYT oped, ties the zigs and zags to the formation of political alliances. While the middle class (or, on the chart, the middle quintile) prospered, the piece of the pie owned by the wealthiest 1 percent shrunk. The ranks of the ultra-rich atrophied, with a higher portion having inherited their wealth than earned it, compared to earlier eras.
Shamus Khan writes: “In the postwar period the rich found themselves in a quandary. Their wages and their membership were static. They needed to resuscitate themselves. This required allies who shared a basic concern. The rich thought, not incorrectly, that high tax rates were handicapping their capacity to advance. And they found common ground with suburbanites who didn’t see social spending as something that enhanced their lives and neighborhoods, but as something that transferred their tax dollars to a different kind of American — urban, of a notably darker hue — who had only recently gained political legitimacy. Through a tax revolt these groups went to work dismantling social programs.
“They were terribly successful and they helped turn America on its head. Since the late 1970s, it has been average Americans who have experienced comparative wage stagnation and who are more likely than their parents to stay in the same economic position. For the rich, the story is the exact opposite.”
Or you can tell your own story.