In The Post's Sept. 5 news story on our study of growing income gaps between high-income and other Americans ["Study Reports Record U.S. Income Gap"], William Beach of the Heritage Foundation attacks the study on two grounds. His criticisms are off-base.
Mr. Beach suggests the widening income disparities are caused primarily by transitory demographic developments, with baby boomers reaching their peak earning years (and thereby raising incomes at the top) and their parents retiring (and lowering incomes at the bottom). His statement ignores the findings of leading researchers from the Census Bureau and RAND, which indicate that these demographic trends have not played a significant role in causing income disparities to widen. The causes lie elsewhere and do not appear to stem from transitory developments.
Mr. Beach also alleges that our study ignored the income gains made since the 1990-1991 recession. This is incorrect. All such gains are included. The study covers the full period from 1977 to 1999 and shows that income disparities grew sharply in the late 1970s and during the 1980s and continued growing, although at a considerably slower pace, during the recent recovery. That income gaps have continued to widen since 1993 represents a departure from the decades before the 1970s, when income gaps narrowed during periods of economic growth.
Our study is a straightforward presentation of Congressional Budget Office data on income disparities, widely acknowledged to be the best such data available. It's unfortunate that some prefer to deny or seek to explain away the hard reality of burgeoning income disparities, rather than think about how to promote more broad-based growth.
Isaac Shapiro is a senior fellow at the Center on Budget and Policy Priorities. Robert Greenstein is the center's executive director.