AS AN adornment to the many academic studies of income inequality, Lexington is compiling a miscellany of spurious anecdotes about the very rich. Entries should, ideally, sound plausible but turn to dust after a few phone calls. Recent additions to the collection include the cash bonuses supposedly paid to high-performing wives on Manhattan’s Upper East Side, and the letters supposedly signed by senators recommending infants to the admissions officers of Washington kindergartens. This endeavour may sound frivolous, and it probably is, but what people are prepared to believe about the doings of the very rich is a measure of the distance between the observers and the observed.
The presidential election in 2016 will be the first to take place since economists began scrutinising tax returns to measure the increase in pre-tax income inequality over the past century. In 2012 the contest may have descended faster than Mitt Romney’s car-lift into a debate about the Republican nominee’s personal wealth, but it actually took place against a backdrop of crunched asset prices. In the years since, the S&P 500 has increased by 45%, with consequent gains in the...Continue reading
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