The One-Percent Fallacy

Mark Twain said, “there are lies, damned lies, and statistics.”  Those with training in statistics are alert to its many deceptions – as are the spin doctors.  The populist rage against the top 1% income bracket is an especially dangerous fallacy.   It gives the impression that the 1% are a specific group of people hogging all the income.  In fact, any survey will have a top 1%, and a top 10%, and a bottom 10%.  You will find different people in these categories every time you run the survey.

Our favorite economist, Dr. Thomas Sowell, calls this the “enduring class” fallacy.  In fact, someone in the top 1% this year probably wasn’t there last year – and probably won’t last two years.  This churn among all income levels is called social mobility, and it’s what makes America the “land of opportunity.”

The enduring class fallacy dovetails with the zero-sum fallacy, which Dr. Sowell has debunked elsewhere:

“There is a lot of anger and it’s for a very good reason,” Wolff said. “If all of the income gain goes to the top, there’s not much left to go to the rest of the people.”

Unbelievably, the fellow quoted above is an economist.  This idea is just ridiculous.  No one has actually believed it since, maybe, Mao – and it’s likely the Marxists only use it for recruiting.  It seems appropriate to cite an iconic Democrat in rebuttal:

As they say on my own Cape Cod, a rising tide lifts all the boats.  And a partnership, by definition, serves both partners, without domination or unfair advantage.

It was lovely to hear that, with “pahtnership,” in the original Boston accent.  In fairness, social mobility in America is not what it used to be.  The OECD found that Scandinavia now has better mobility, and so did the Institute for Labor.  Both studies found that it is hard for Americans to climb out of the bottom quintile, due to poor public education.  That’s what we should be protesting.

Advertisements

Leave a comment

Filed under Media

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s