I’ve written several times about tax policy and middle class wage stagnation.  There’s plenty of evidence that as middle class wages languished for the last 25 years, those individuals chose to use overinflated home equity and easy credit to become more and more leveraged in order to live a lifestyle that had moved out of reach.

I posted data from a Center on Budget and Policy Priorities study a couple weeks ago that illustrated, in tabular form, the disparity between middle and upper class earnings over the last thirty years.  The data, broken into five income classifications, notes the middle quintile’s after tax earnings increasing 29% from 1979 to 2006.  The uppermost quintile, those individuals comprising the top 1% wage earners, saw their earnings in that time frame increase 256%.

This weekend I came across another CBPP study that used the data above and compared it to the preceding thirty years wage growth.

Pretty stunning, huh?  The post World War II years are known as the era when the United States became the economic powerhouse in world, led largely by a dramatic standard of living improvement among the middle class and a resulting purchasing power that fueled the dramatic economic expansion.

It makes one wonder how things would be different had a more fair tax policy been employed since the Reagan Administration and carried to the extreme by the Bush presidency.

Let’s pray Americans never get suckered again by supply side economics and regressive taxation policy.

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