Dr. Phil on economy: what the evidence says · JRE #2105
SUBJECT: ECONOMY
Not a true/false call. Every claim is logged with its sources; read the exhibits below.
the problem in America and I talk about it in a section in the book, is not income inequality but income equality. If you look at the bottom 20% and compare them to the middle 20% of the difference, the bottom 20% only 5% work full-time, the middle 20%, 95% work full-time,
What the evidence says 01 / RECORD
MISLEADING. The direction is right (bottom-quintile households work full-time far less than middle-quintile households) but Dr. Phil's specific 5% vs 95% magnitudes are not supported. The Census Bureau's HINC-05 table (Percent Distribution of Households by Selected Characteristics Within Income Quintile), the primary government source for work status by income quintile, shows a real but far smaller gap. Using the CPS counts by quintile: among lowest-fifth households the householder worked at a full-time job in about 23% of households (5,067 of 21,859), and full-time year-round (50+ weeks) in about 14% (2,962 of 21,859). Among middle-fifth households the householder worked full-time in about 68% (14,875 of 21,859) and full-time year-round in about 58% (12,705 of 21,859). So the honest comparison is roughly 14-23% for the bottom quintile versus 58-68% for the middle, not 5% versus 95%. The low bottom-quintile figure is largely driven by retirees, disabled, students, and single-person elderly households concentrated there, which is the legitimate underlying point, but both headline numbers are inflated. No Census, BLS, or CBO table shows a 5%/95% split. On the secondary claim that welfare erases most of the gap, taxes and transfers do substantially narrow after-tax-and-transfer income between quintiles, but the cited full-time work rates themselves remain unsupported.