(Bloomberg) — Treasury Secretary Steven Mnuchin says there’s no question in his mind that the recovery has been great for rich people, who have prospered even as many Americans have seen their incomes stagnate.
The data back up Mnuchin. Weekly earnings for full-time wage and salary workers in the lower rungs of the earnings distribution have been crawling along since the 2007-2009 downturn, even as the top 10 percent of earners saw their pay slowly pick up.
To be fair, the bottom rung of the income ladder did see improvement in 2015 and 2016. Those people are now making more in constant dollars than they did when the series started in 1979 — the first time that’s been true for back-to-back years since the early 2000s.
Still, after a long era of stagnation, America’s lowest- and median-earners take home about 4 percent more each week than they did in 2007. The top earners in the ninth-decile have seen weekly earnings increase by 8 percent.
Mnuchin has an idea for swinging the pendulum — tax reform. His view is that a White House proposal to slash the corporate tax rate to 20 percent from 35 percent will turbo-charge the economy, driving a business boom and boosting wage growth.