Congressional Budget Office Data Highlights Income Inequality Trends in the 1980s
The Congressional Budget Office (CBO) data from the 1980s has been pivotal in discussions about income inequality in the United States. A New York Times article from 1992, reported by Sylvia Nasar, highlighted how income gains during the 1980s were disproportionately skewed towards the wealthiest individuals. This report included insights from economist Paul Krugman, who noted that the additional income from economic growth primarily benefited the top income earners. The article also referenced Lawrence Lindsey's observations that tax reforms in the early 1980s, which reduced the top federal income tax rate from 70% to 50%, encouraged high-income individuals to report more taxable income. This shift was partly due to a move away from tax-exempt investments like municipal bonds. The CBO's data became a focal point in political discussions, particularly during Bill Clinton's presidential campaign, as it illustrated the growing economic disparity and was used to argue that the middle class had not significant... 
