Forget Roman Catholics and contraception, evangelicals and Mormonism, Newt Gingrich’s three wives and even Mitt Romney’s dog. If you are struggling to understand a roller-coaster U.S. election season, described by one writer as “wackadoodle,” your Rosetta Stone should be a dry academic paper by the economist Emmanuel Saez.
In an age of celebrity scholars, Saez, a professor at the University of California at Berkeley, is a shy data jock who does most of his communicating by marshaling vast pools of statistics. But he has probably done more than any pundit or political spinmeister to shape the political narrative of our age — it is the number-crunching of Saez and his longtime collaborator, Thomas Piketty, that gave us the notion of the 1 percent and the evidence that they are pulling away from everyone else.
That’s why, in the community where economics and politics intersect, a new Saez paper is hot news. And his latest, which set Twitter abuzz this week, is a humdinger. Saez has come up with a killer fact: In the 2010 recovery, 93 percent of the gains were captured by the top 1 percent. That’s because top incomes grew 11.6 percent in 2010, while the incomes of the 99 percent increased only 0.2 percent.
That gain is particularly painful because it comes after an 11.6 percent drop in income for the 99 percent, Saez reports, the largest such fall over a two-year period since the Great Depression. That decline more than erases the income gains since the last downturn. We may not yet be a lost generation, but we have certainly experienced a lost decade.
This battering of the middle class — or really, everyone except the rich — is the powerful and painful economic reality that is driving the angry, polarized political debate in the United States. Saez is hardly a household name in the U.S. heartland, but the economic whiplash he describes is American everyday life. It is why voters are so angry, and why they are attracted by candidates who present themselves as outsiders offering a vision of change.