The newly released study took family incomes from 2004 to 2006, and compared them to an inflation adjusted period of 1987 to 1989. The study is not so surprising; everyone knows that minimum wage hasn't moved in tandem with market wages. While CT's spike of a 45 percent increase for its top fifth of households is not a shocker (I've seen those Land Rovers on the Merritt Parkway), it is a little bit of a WTF that the bottom fifth actually dropped 17 percent.
Some other sobering stats:
- New York had the highest income gap among the 50 states in 2004 to 2006, according to the study, with the top fifth earning an average of $148,200 a year, or 8.7 times the $17,100 income at the bottom. Connecticut ranked seventh and New Jersey, where the rich earned 7.5 times what the poor did, was 14th. (The rankings did not include Washington, D.C., which had by far the biggest income gap, with the rich earning an average of $188,500, the highest income in the country, 13.5 times the poor’s $14,000 average.)
The study’s authors adjusted family income for federal taxes but not state and local taxes. So the study may not accurately capture the gap in high-tax states like New York that tax high earners for the benefit of those who are struggling.
Of course, the article goes on to make brief mentions on tax policy. I am no expert on taxes, but I like that NY taxes its high earners. What I don't like is that NY state spends more of its tax dollars on its prison industry than its universities. See, the thing about tax policy chatter is that it fills the room with a lot of talk about how a state gets money, rather than what the state does with it. And that's one stunted conversation on tax policy.