During the third presidential debate, Hillary Clinton claimed that “most of the gains in the last years since the Great Recession have gone to the very top.”
This factoid is a hardy perennial on both Left and Right, with the latter sometimes invoking it to argue that President Obama has done a very poor job of combating “income inequality,” or that Obama’s presidency proves not even the most dedicated leftist can fix income inequality through redistributionist government policies.
Various estimates have held that the “top one percent” received 90 or 95 percent of the income gains during the Obama presidency. It should be noted, however, that the gains became more evenly spread over the last two years, as the job market began shaking off its paralysis.
There have been many challenges to the “Top one percent got most of the income gains” statistic over the years, including the argument that measuring income is not the most accurate way to determine economic inequality.
Also, the recovery of the stock market after the 2008 financial crisis was a major reason for these income benefits accruing to the rich, and a healthy stock market is often touted by supporters of President Obama as proof that his policies were working. It’s rather hypocritical for Democrats to attack the logical end result of something they’ve presented as an economic benefit: people who own stocks making a lot of money from the recovering stock market. Some of those same people lost a lot of money when it went down.
But Clinton portrayed these top earners as essentially criminals who must be punished. She certainly wasn’t blaming Obama’s policies for the situation:
We are going to go where the money is. Most of the gains in the last years since the Great Recession have gone to the very top. So we are going to have the wealthy pay their fair share. We’re going to have corporations make a contribution greater than they are now to our country.
Yes, top earners indisputably received the lion’s share of income growth from the post-2008 recovery, but the reasons why are far more complicated than the purely predatory behavior Clinton implies.