Reagan’s rising tide

I like the second half of that argument - but the first half is a myth. Lopsided economic growth that delivers huge gains to a small elite while bypassing a majority of Americans didn’t start a few years ago. It started during the Reagan years.

This reality is obscured by the business cycle: America experienced a severe double-dip recession from 1979 to 1982, which was triggered in part by surging oil prices. The economy then saw a V-shaped recovery after the Federal Reserve drastically cut interest rates (and oil prices fell, adding to the gains). If you start from the depths of the recession then, yes, the United States did experience economic growth that benefited everyone - but that had nothing to do with Reaganomics, which promised long-term growth.

If, instead, you look from business cycle peak to business cycle peak, you see the data on this chart. Median household income in the United States was barely higher at the end of the Reagan years than it had been in the late 1970s. And today, as back then, the rising tide continues to lift mainly the yachts.