Michael Gerson has written an interesting editorial entitled, Romney can gain upper hand on economic policy by focusing on class. While the title may be true, some of his “facts” are rather questionable. Mr. Gerson cites a work by the Pew Charitable Trust’s Economic Mobility Project entitled Pursuing the American Dream: Economic Mobility Across Generations. This is a follow-up to their 2008 report, Getting Ahead or Losing Ground: Economic Mobility in America. Were Mr. Gerson goes off the rails, as do the reports themselves, is in this statement:
But relative mobility — the chance of rising to a higher income quintile — is stalled, particularly near the bottom. Even though many earn a bit more than their parents did, they aren’t moving up the income ladder.
Actually, those whose parents were in the bottom quintile are the most likely to get to a higher income quintile. After all, there is nowhere to go but UP! Also, there is little indication that the bottom is any more “sticky” than it was four years ago. In 2008, 42% of children whose parents were in the bottom quintile are also in the bottom quintile, and in 2012 it is 43%. That is hardly “stalled.” Finally, in real terms, the children of the bottom quintile now have incomes TWICE what their parents did, while those children of the TOP quintile have income slightly LOWER than their parents. (These numbers are adjusted for inflation and family size.)
About 36 percent of families have actually fallen behind in relative terms, which drags America’s overall level of mobility to below that of many European countries. (Gerson)
Well, yes. If 36% get ahead of their parents in relative terms, then by definition 36% must fall behind their parents. That’s what relative means. That number can only go between 0 and 50. In relative terms, the children of the top quintile cannot surpass their parents — there is no sixth quintile for them to get into. To get to the 50% level, every child born to the bottom quintile would have to rise above that, and everyone born to the top quintile would have to fall out of it. Even in a perfect meritocracy, that would not happen — 20% of the children of the bottom would stay there, and 20% of the top would stay there.
One-third of Americans [who have more income than their parents did] are either “riding the tide,” that is, moving up in income without changing relative standing, or falling in relative rank despite making more than their parents in family income. (Economic Mobility Project)
But they are complaining that 33% are not moving ahead of their parents, when 20% cannot. So take out that 20%, and 84% of the remaining people who earn more than their parents are also moving into a higher quintile. Considering that one can easily imagine the children at 21% moving to 39% are doing MUCH better than their parents, but staying in the same quintile, I see no problem with the 84% figure at all.
Lie, damned lies, and statistics.
Either they are trying to lie with statistics, or they are just ignorant.