In discussions of tax policy, folks like me tend to throw around references to “income fifths,” “the top 1%,” and such without enough context. Below is a graph which shows the actual income levels in 1979 and 2007. Unfortunately, 2007 is most recent year for this very comprehensive income data set published by the Congressional Budget Office. But it’s still elucidating re the actually dollar values behind these income classifications and how they’ve changed over the past few decades.
The chart shows average household income levels for each fifth of the income scale, along with the top 10, 5, and 1 percent of households, in real 2007 dollars.
The fact that incomes at the top of the range have grown so much over these years kind of messes up the scale (yet another problem associated with the growth of income inequality—it’s getting hard to plot!) so I include a table as well.
Back in 1979, the average income of the top 1% was about 33 times that of the bottom fifth. In 2007, that ratio had grown to 100. The real income of middle-class households grew 19% over these years, less than 1% per year, while that of the top 5% grew by about 150% and the top 1%, by 240%.
Now you’ve got some context. Sorry you asked??