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The curve above IMO can have 3 explanations:

a) Americans work less than in the 70's
b) Labour is taxed now harder than before
c) the FIRE sector (finance, insurance, real estate) takes their money, or
d) The yields from productive capital have increased significantly and/or at the expense of labour.

by kjr63 on Wed Mar 4th, 2009 at 05:55:51 AM EST
a) Logically possible, but empirically untrue.
b) True, but IIRC the graph above is for before-tax income. At any rate, the point is covered in the Warren video at the end.
c) Again, IIRC the curve is before-tax income, so that wouldn't show up in the curve (it's true, of course, but doesn't necessarily show up in the curve).
d) Virtually the whole story.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Mar 4th, 2009 at 07:52:53 AM EST
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