Visualizing economics has a graph of where the top .01% gets their income, excluding capital gains. Looking at the time-series data, there’s a pretty clear story that dividend income has gotten much less important while wage income has grown significantly in importance.

What this means is that the richest of the rich are now earning their money through wages (whether as CEOs, lawyers, or bankers), rather than just collecting bank interest. It says something huge about wealth distribution. There will always be a top .01%, but would we rather the top .01% be filled with those who make their money by working for it and getting paid for it, or by sitting on their couch and letting the bank interest on their billions finance their luxury? I’m especially curious about the left-wing response, as the left is generally more concerned with issues of income equity.

Excluding capital gains does change the data some, as many of the capital-intensive wealthy are seeing income through more active capital (investments) rather than interest.

Categories: America, Business and Economics, Politics