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Home Publications Blogs Beat the Press Robert Samuelson Is Trying Yet Again to Divert Attention from the Upward Redistribution to the Wealthy

Robert Samuelson Is Trying Yet Again to Divert Attention from the Upward Redistribution to the Wealthy

Sunday, 03 November 2013 21:59

Robert Samuelson has pretty much devoted his column to trying to distract readers from the policies that have redistributed income upward to the richest one percent, urging them instead to focus on high living seniors. The latest occasion is a new study from the St. Louis Federal Reserve Bank which found that median income for those aged 62 to 69 gained 12.3 percent to $50,825 from 2007 to 2012. It found that median for those over age 70 increased 15.6 percent to $31,512.

There are two points worth noting on this one. First is that while median family income did rise for older families, while it fell for younger people, the absolute income levels for those over age 62 were still considerably lower than for those between ages 40-61. The difference is 11.7 percent for those between the ages of 62-69. The gap in median incomes was 44.6 percent for those over age 70 compared with those ages 40-61. (One of the reasons for the rise in income is the mix of people over age 62 has skewed sharply downward over this period as baby boomers now fill the younger portion of the age group. The young elderly always have higher income since many are still working and they have not yet spent down their assets.) 

The other factor worth noting is that much of the improvement in income is simply due to the fact that people are living longer so that more of these families are two person families now than was the case in 2007. If we look at the Census Bureau's estimates for median person income, we find that this rose by 7.8 for women between the ages of 65-74 between 2007 and 2012, but just 3.2 percent for men. For men over age 75 median person income rose by 2.3 percent, while it fell by 1.7 percent for women over age 75.

This picture may still look better than the median income for younger people, but this is a story about having the losers fight among themselves. Since its 1999 peak, the median income for men from age 62-74 has risen by 7.4 percent. For women in this age group it rose by 13.9 percent. For men over age 75 it by just 0.007 percent, while for older women it fell by 1.1 percent.

This is a period in which average per capita income rose by 21.1 percent. Clearly the typical senior was not getting their share of the gains of growth even if they might have been doing somewhat better than the young. The big gainers were of course the Wall Street folks, the CEOs, and highly protected professionals like doctors and dentists. Yet Samuelson insists that we need to beat up on the elderly.

There is one other point about Samuelson's agenda that deserves highlighting. He wants us to cut Social Security and Medicare because today's seniors have not taken as big a hit as those who are younger. However, any cuts to Social Security and Medicare will almost certainly be phased in through time. This means that they will likely have a bigger impact on people who are today in their forties or fifties than the people now in their sixties and seventies. Since this age group has taken a big hit even by Samuelson's measures, he is proposing cuts that will have their largest impact on exactly the group of people who have taken a big hit in the downturn with little time to recover. This doesn't sound like good policy.  


Comments (6)Add Comment
written by watermelonpunch, November 03, 2013 11:17

I just don't understand having it in for a group you know you will one day be part of, if you survive.

But aside from that, should instead we be looking at these things not from age groups, but from groupings by birth year?
I just think of that because it seems like what year someone was born, and what year they were likely to have entered the workforce, has a much greater impact on personal wealth than what age group they're in at any given time.
And it would get around this deceptive baby boomer issue.
Cardinal Rules of Distraction by Sock Puppets from the Economic Elephant in the Room
written by Last Mover, November 04, 2013 6:54
Robert Samuelson has pretty much devoted his column to trying to distract readers from the policies that have redistributed income upward to the richest one percent ...

This capsulates the ongoing economic war between the plutocrats who run America and their victims largely through control of the media by concern troll sock puppets like Samuelson.

Talk about anything and everything except the obscene concentration of income, wealth and staggering political power wielded by the 1% to keep it that way.

The concocted zero-sum rules of concern trolls about distribution of inome and wealth between makers deemed beforehand in the 1% and takers within the 99% include:

Always talk as if the wealthy earned their income and wealth in free markets. Never attribute it to unearned income and wealth from government action or inaction with which the wealthy control the markets they claim to embrace.

Always talk as if the wealthy are the only source of jobs and income which pay a survivable income. Never attribute job creation to obvious macro-economic or international trade policy in the aggregate except when bashing government for crowding out jobs in the private sector.

Always talk as if the wealthy pay for most of government costs to provide entitlements for everyone else as if it were a zero-sum game. Never talk about why 99% of America never has the opportunity to be in this tax bracket in the first place.

Always talk about the "undeserved wealthy" as uniquely arising from "flawed redistributionist entitlement" programs rather than the seriously wealthy who run the country from behind an economic cathedral of protectionist walls so high the entry requirements exceed millions and billions just to enter and play the game of running America with a financial joystick.

Now about coddling those seniors who are robbing the rest of you blind America:

We already know they didn't earn the amount in question don't we, so the question of separating them from the true makers is a moot point isn't it America.

Now all that remains is to determine which makers they are robbing. Again, a moot point. They are obviously taking from makers in the 99% like the younger generation.

See, coddled seniors couldn't be taking from the 1% makers could they, because those makers would have never made it into the 1% in the first place would they. Instead, they would have been dragged down and crippled by the subsidies forced from them to pay subsidies to ... coddled seniors.

Thanks again Robert Samuelson for explaining as an economic concern troll, how intergenerational warfare among the 99% is bringing down America and has nothing to do with the 1%.
fenominal dud
written by gnat, November 04, 2013 7:57
The 62-69 year group may have multiple incomes from SS, pensions and consulting.
written by skeptonomist, November 04, 2013 8:07
Many of those now in the older cohorts benefited from the extremely favorable investment climate from around 1982 to 2001. Not only was there a record bull market in stocks, returns on bonds were good as interest rates steadily declined. Those whose retirement will depend on returns after 2001 will probably not do as well. Returns were also not so good 1965-1982.
written by AlanInAZ, November 04, 2013 12:54
I suspect income statistics for the group aged 60 years and above can mislead if the rise in income is due to withdrawals from tax deferred accounts. In my own case half my reported income is due to withdrawals from 401k accounts. Early retirees or unemployed may be forced to pull out money faster than the maximum rate to prevent running dry in later years.
divide and conquer
written by Dean Kisling, November 04, 2013 1:07
Damn all those...
old people
young people
black people
brown people
lazy poor
uppity women

My goodness! How are the hard-working, freedom-loving job creators supposed to keep up with all these takers... if they aren't allowed to rob them?

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.