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The Real Story of American Income Mobility

BEGIN TRANSCRIPT

RUSH: "Professor Mark R. Rank of Washington University, co-author of Chasing the American Dream: Understanding What Shapes Our Fortunes, tells a different story --" than this Thomas Piketty book from France.  "-- in a review of his own and others’ research in last Sunday’s New York Times. Far from having the 21st-century equivalent of an Edwardian class system --" which is how the Obamas and the socialists view America today, "-- the United States is characterized by a great deal of variation in income." We're all over the place. 

Here are some stats and these are Census Bureau numbers.  "More than half of all adult Americans will be at or near the poverty line at some point over the course of their lives." More than half.  Now, I don't know about you, but I have been three times.  I have been broke three times in the 1970s and '80s.  I was at whatever the poverty line was.  And according to the research here more than half of us will be either at the poverty line or near it at some point over the course of our lives.  I've been there three times. 

"Seventy-three percent will also find themselves in the top 20 percent," at some point in their lives.  Not forever.  They're going to have good years, bad years, a couple of good years in a row, three, four good years in a row.  The bottom will fall out.  But 73 percent of Americans will find themselves in the top 20 percent of income earners.  These are important numbers. These are not insignificant.  "Thirty-nine percent of Americans will make it into the top 5 percent for at least one year." Thirty-nine percent.  That is a large number of people to make it to the top five percent for at least a year. 

But what does that mean?  It means that people who get there don't stay; that many of them fall out of it.  Because income is not something that's steady.  You don't earn the same amount every year.  It's tough to get people to agree to pay you an amount of money that's big.  In many cases to earn that kind of money you have to be in business for yourself, or you have to be surviving on commission sales of some sort.  There's more to this, folks, too, it gets even better.  

BREAK TRANSCRIPT

RUSH: Seventy-three percent of us will find ourselves in the top 20 percent.  Thirty-nine percent of us will make it in the top five percent for at least one year.  "Perhaps most remarkable, 12 percent of Americans will be in the top 1 percent for at least one year of their working lives."  If you listen to people like, take your pick, any Democrat, Barack Obama, Dick Gephardt, this is not possible because the only people that end up in the top five percent, one percent, are called the winners of life's lottery, and that means the lucky.  They were born to it, or they got lucky with some invention.  Never is it hard work.  Never is it industriousness. Never is it creativity or entrepreneurism, unless it happens to be one of them. 

But as a political matter, as they make policy, it simply is not possible to work from nothing.  You've gotta go to Yale.  You've gotta go to Harvard.  You've gotta have the right connections, know the right people, be in the right network if you even have a chance of making $100,000 a year.  And right here, 12 percent of Americans will be in the top one percent. 

Now, NBC went out and hired a psychological executive to profile David Gregory to figure out why it is his ratings are falling in Meet the Press.  They were trying to figure out why is it that David Gregory doesn't relate.  Why do massive numbers of millions of Americans not relate to David Gregory?  And I'll guarantee you the answer can be found right here.  If you throw these numbers at him he would not believe one word of this.  This is the exact view of America I have. 

When I read these stats, this is you.  You and this audience.  Some of you in the top one percent, some in the bottom 30. Some of you are flirting with poverty now and then.  You're in and out of it.  You're active.  You're living.  You're taking chances.  You're doing things.  You're on the go.  You're trying to make the most of the one life that you have. 

Things happen.  Good things.  Bad things.  You adapt as the bad things happen.  You celebrate when the good things happen.  When the good things happen, you try to sustain them.  We all do.  "Okay.  What happened?  What made this good thing happen so I can keep doing it?"  We all do these things.  But if you are an American liberal today you disdain all of this.  None of this is real.  None of this is possible.  The state makes this possible for people.  People are not this competent.  People are not this capable.  People can't do this on their own.  If they do, they're cheating or they're stealing or they're not paying enough in taxes or whatever convoluted explanation leftists come up with to explain prosperity. 

In their world view, posterity isn't genuine.  It's an accident. It's luck. Folks, I'm telling you, that's the worst possible person to have lead the country, who thinks that prosperity is an accident, who thinks that prosperity and good fortune is luck.  Luck is where preparation meets opportunity.  That's all it is.  Luck, some say, it's the residue of hard work meeting opportunity.  But you can't have people who do not believe in this leading this country and have this country remain what it has always been.  It just can't happen.  And we do now have people who do not believe this that are running this country, and they think this is all lies.  It's unjust.  It's monkeyed numbers. It's unfair. They don't think it's possible.  And they look at their own lives. 

The wealthy left ‑‑ forget the Hollywood left and forget the pop culture left.  But look at the people that are wealthy on the left who really don't work for it.  They feed off others.  They feed off the donations to the think tanks they run.  They feed off of the donations from George Soros.  They feed off of the ancillary dollars that government hands out in grants and so forth.  That would be scary to depend on.  That would require connections.  That would require sucking up to people.  That would require knowing the right people.  That would have nothing to do with being good at anything.  That would have everything in the world to do with being artificial and phony.  And that's what they are.

Anyway, if we don't have leaders who believe in this being possible, and we don't right now, that's the problem.  We need people who are in leadership positions who believe this, who can inspire it in others.  If you're a young millennial and you're coming out of school and you've got your degree and it's in some worthless liberal arts major or what have you, because that's what you were told to do and your future is looking pretty bleak. And you've got a leader who tells you, "Yeah, it is pretty bleak, leave it to me."  That's no good. 

Great leaders inspire people by telling people what they are capable of, what is possible, what needs to be done, what can be done.  It's happening in little enclaves all over this country.  Small companies, large companies, it's happening in a lot of places.  It is not happening at government.  And it is not being inspired by government or from government.  Government doesn't create wealth.  All government can do is redistribute it or destroy it. 

What young people today need is what young people in this country have always had, and that is optimistic role models, people willing to inspire them.  People willing to tell them what's possible.  People willing to remind them they live in the greatest country on earth and what's possible here and who have enough knowledge who can cite examples.  People who came from all walks of life, born in all kinds of socioeconomic circumstances, who made the most of their lives.  Not by virtue of luck.  Although there's luck in there.  Everybody needs help.  Everybody gets assistance.  Nobody's totally self‑reliant and nobody ever makes a claim that anybody is. 

But the Democrat Party is hell bent on convincing as many people as possible that no success is really earned.  Their lifeblood depends on as many people believing that there is no real success.  That everything is a rigged game, comes from connections, who you know, who you've greased, however you networked to get where you are. That hard work and industriousness and creativity and coming up with something new, ingenuity, none of those things matter.

We don't need all this negativism.  We don't need all this malaise, this cloud, this overcast, this mist of despair all over the country that we are being led by now.  And the solution is income equality?  That is the big answer to everybody's economic dreams?  I ask football coaches, NFL coaches, as I get older I wonder if the game is going to change.  Everybody does.  I remember I talked to Bill Parcells.  It was at a Wayne Huizenga golf tournament, Wayne Huizenga course in Palm City, Florida.  This must have been 10 years ago, maybe longer.  And I remember once I talked to Harry Caray, one of my childhood heroes, baseball play‑by‑play for the St. Louis Cardinals. 

After awhile I outgrew baseball.  The baseball players that were my heroes growing up, when I became older and I got to be older than the players they stopped being the same kind of heroes to me.  And so I would ask these experts, I asked Harry Caray, "Is the game the same, Harry?  Is it as good as when Musial played?  Are the stars as good when Schoendienst was at second base? Dick Groat at shortstop, Curt Flood in centerfield?" 

He said to me, "Oh my god, the game's never been better.  Rush, I'm in Chicago.  I've got Ryne Sandberg at second base. I've got some of the best pitching I've seen in baseball. The game's better than ever!"  Which I was happy to hear.  Don't misunderstand.  When I talked to Parcells and I worried, socioeconomic conditions, "Is the game changing, coach?  Is it being played by different people now?"  He said, "No, Rush, they've all got their dreams just like we had when we started.  They all want to be in the hall of fame.  They all want to be the best.  They all want to be the best they can be.  The names change.  And maybe the styles.  But the caliber of player may be better than in the past." 

I was happy to hear it.  You want that for every walk of life in the country.  You want every generation being better.  This is the country where this is possible.  It breaks my heart that we are being led by a bunch of people to whom all of what I'm saying to you is foreign.  They don't understand it.  They think it's impossible.  They think it's never been real, in fact.  The United States has never really been this great country.  It's always had what it's had because it's stolen from others or it's committed genocide around the world or it maimed native Americans and enslaved black people and so forth and they live in this historical backwater where they're unable to get past what they see as genuine horrors that are definitive.  They're unable to see past the days where those were erased, dealt with, crisis paid, and we moved on. 

But man, some of these economic numbers of where people end up. I know a guy, he's passed away, he made and lost a $200 million fortune twice in a period of 10 years.  I can't relate to that.  He did it in commodities.  His first name was Ned.  He was a World War II veteran.  He was a World War II hero and nobody knew until his funeral the extent of his heroics, because he never talked about them.  But he was just constantly on the go and he always had things in play.  Things were always in motion, and there is no way that this man Ned that I knew would in any way even understand the president of the United States trying to establish as a national policy something called income equality. 

You don't know what it is.  Based on what?  Based on family size?  Based on income quality to buy what?  To live how?  He would have understood exactly what it is.  It's nothing more than a political ploy right out of the class envy playbook.  But what all this Democrat Party politics is doing is destroying people's dreams.  It's destroying people's belief in themselves.  It is creating envy and jealousy of people who have genuinely succeeded rather than creating role models and curiosities out of people. 

Speaking for myself, I don't recall ever resenting anybody who had more than I did.  I often asked myself why they did.  But I never resented it.  I knew there was no future in that.  But I always wanted to know how, why?  How did they do it?  And these statistics, 12 percent of Americans will be in the top one percent for at least one year of their lives, and then there's more.  The top one percent is such an unstable group of people. It changes so much every year it makes no sense to write about what's happened to the income of the one percent over the past 10 or 20 years because it doesn't contain the same group of people from year to year. 

It's ridiculous to study the one percent.  They are not the same people year in, year out.  Yet you listen to the Democrat Party talk about them and they are this collective group of evil people, they belong to this club and that club.  It's time we got our arms around all this and realize that we live in the greatest place on earth where the greatest things possible still are and that's what we have to strive to save and remind everybody younger than we are that it is indeed possible.  You gotta be inspirational, motivational.

BREAK TRANSCRIPT

RUSH: Here is the final bit of data here from Mark Rank of Washington University, which is the best counter to this Thomas Piketty book.  We left off with the fact that top one percent are such an unstable group of people, that people move in and out of it.  You think of the one percent as Warren Buffett and the Koch brothers and Bill Gates.  That's the 1/10th of one percent.  The one percent, 12 percent of the America are going to be in that group at least one year of their lives.  It's small, but at least 12 percent are going to move in and out of it.  But you can't study it. You can't make any definitive socioeconomic claims about them because they change too often. 

It does not contain the same group of people from year to year.  There's a tax scholar by the name of Robert Carroll who has examined IRS records, and Professor Rank notes "that the turnover among the super-rich (the top 400 taxpayers in any given year) is 98 percent over a decade -- that is, just 2 percent of that elusive group remain there for ten years in a row."  Now, you listen to Barack Obama and the Democrat Party, Joe Biden and Dick Gephardt, and you're going to be told they're the same people. They've been there since the day they were born. They will be there until the day they die and then their families take over.  They are this evil, faceless group of people that start sipping cocktails at 4:30 in the afternoon playing polo or croquet, clipping coupons, don't even know when the country's at war. 

That's not who they are.  They are you.  They have been your neighbors.  It's the essence of freedom and liberty and opportunity that makes this possible.  It is not command and control economics.  It's not people assigning these incomes to people.  It's not networking.  If you could network yourself into this situation you'd stay there forever.  It's work, folks.  It results from work.  It results from creating things that people want, producing services people are willing to pay for, and then staying on the cutting edge so that your competitors don't outdo you.  Capitalism is blood lust. 

Look at what's going on with Apple and Samsung and everybody in the smartphone industry right now.  It is some of the bloodiest competition you will find in the civilized world.  And it is unfair and it is filled with tricks.  It's filled with chicanery.  It's filled with deception.  That is what it is.  And the big boys play in that league and if you want to be a big boy in that league there's a route you take to get there, and you can in the United States of America.  Some people don't want to go that high.  Some people don't want to get involved in that game.  Some people don't have the stomach for it.  Some people don't want to deal with the stress.  Other people thrive on it.  We're all different. 

We cannot ever be the same.  It's one of the most profound insults, particularly for a leader of a country like this to even assume that sameness is possible.  It's even worse to assume that sameness is an objective.  So two percent of the super rich remain there 10 years.  Two percent.  The top 400 taxpayers in any given year remain there for 10 years. 

"Among those earning more than $1 million a year, most earned that much for only one year of the nine-year period studied, and only six percent earned that much for the entire period. 'Ultimately,' Professor Rank writes, 'this information casts serious doubt on the notion of a rigid class structure in the United States based upon income. It suggests that the United States is indeed a land of opportunity, that the American dream is still possible -- but that it is also a land of widespread poverty.' Data from the Bureau of Labor Statistics finds that among the allegedly privileged 1 percent, inherited wealth accounts for only 15 percent of household holdings, a smaller share than it does among middle-class families."

There is going to be poverty in great wealth.  There just is.  You're always going to have extremes in everything.  There is no flat line, folks, unless you're dead.  And then your line is flat.  There is no flat line.  But poverty in the United States of America is not like poverty around the rest of the world.  Those in poverty in this country eat regularly, drive cars, watch television, and make phone calls.  I get lambasted every time I make that point, but that's Robert Rector citing statistics that he's worked up at the Heritage Foundation year after year after year.  

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