[babblefrog]

To the contrary, Reagan was inaugurated in January 1981. The trend had already changed before that. There were major changes to our economy in the late 60s and 70s, including the "great society" programs of Johnson and Nixon, and the stagflation of the Nixon and Carter (and into the Reagan) years. I'd look into those things for a root cause, if I were looking. Which is not to say that Reagan's policies didn't possibly make things worse, too ;-)

[yummyfajitas]

Well, Reagan does get some of the blame. He made changes to tax policy in 1986 which caused companies to replace non-wage compensation (e.g., company cars) with taxable income.

Since taxable income is included in inequality statistics, but company cars are excluded, this caused a big spike in inequality in 1986.

http://www.scottwinship.com/1/post/2011/03/what-would-it-mea...

[danmaz74]

To the contrary of the contrary - if you look at the chart, you'll see that in the late seventies and earliest eighties there were stops to the growth of wages, but they coincided with stops to the growth of productivity. It is well after Reagan took office that the two graphs start diverging - the productivity rises steadily, BUT wages don't.

As to the economic woes of the seventies, how much did they depend on policy, and how much did they depend on the oil crises? Anyway, I don't argue that everything was perfect before Reagan. I just argue that wages stopped being tied to productivity after him.