Megan McArdle is Always Wrong™: Occupy Wall St./Income Inequality division

I have neither the patience nor the time to wade through the divine Ms. MM’s effusion on the class snobbery at the heart of the Occupy Wall St. movement. (Via Edoroso)

It’s the usual McArdle — self regarding (I was a crappy student who went into the punditing racket because I loved it! And I’m better than you because of that!*); chock full of unsourced or supported claims that, as ever with this writer, are too-good-to-check;** and, frankly too wearisome a barge-load of flabby writing to want to wallow in long enough to do the full fisking that it probably deserves.

So to keep it short (as long as you ignore the footnotes)…let’s just look at one exemplary bit of McArdle drawing on her deep knowledge of the data making sh*t up:

Similarly, in the 1990s, when I worked with a lot of mostly blue-collar and first-generation college grads (with a fair sprinkling of Ivy Leaguers, to be sure), I didn’t hear nearly so much about the rich and how greedy they were–even though in the late 1990s, income inequality was almost certainly worse than it is right now.
That would be this income inequality.  Here is a handy chart:
My 53 year old eyes may not be all that acute, but from where I squint at the screen, it sure looks like the share of US income going to the top one percent is higher now than it was in the late nineties.
(Update: Commenter Downpuppy reminds me that McArdle has seized on data from the worst of the financial downturn to show that the unbelievably rich are getting slightly less so in relation to the rest of us.  Given the decades of data on this question showing just such jagged deviations from the upward slope of the plot, this is, as Downpuppy says, a leaf out of the climate denialist’s play book.  Grab just the right slice of a data set and you can prove, for example that Houston is actually habitable (see March and April).)
 If you want to see the data in tabular form, mouse on over here.
In other words — income inequality was piss poor in the 1990s, but it is in fact worse now.
Which means, as ever, recall the Levenson corollary to DeLong’s law:
1.  Megan McArdle is always wrong.
2.  If your analysis leads you to conclude Megan McArdle is right, refer to rule 1.
*Really.  In her own words:
“here’s the difference between me and the outraged lower-upper-middle-class: I chose it.  I decided to have terrible grades and major in English, and then job hop in New York before settling down as an IT consultant. “

**Here’s McCardle on the profile of the archetypal OWS supporter, and the thought process that led him/her to camp out in a manner calculated to offend his/her betters:

Probably they should not have sunk tens of thousands of dollars into acquiring a BFA.¹  But these mistakes didn’t usually used to be crippling.  They were a drag, as you paid off those huge student loans with your tiny little income…²
Unfortunately their choices became utterly, horrifyingly disastrous just at the moment when we had a terrible financial crisis that spiked our unemployment rate up to 10%.  We can argue about exactly who is at fault and to what extent, and how much longer our public sector spending would have been sustainable without the financial crisis.   But whether or not you think their reaction is empirically correct, it certainly isn’t surprising.  To them it looks like a bunch of greedy, stupid bankers stole the jobs that they were entitled to. [Italics added.]
Well, isn’t that special.
Actually, it’s the usual McArdle switcheroo, a bit of clumsy rhetorical sleight of hand she hopes you won’t notice.  It’s not that the bankers — who are demonstrably greedy and stupid (as in, catastrophic failures at the core jobs of managing risk and allocating capital) — hold jobs that might go to others.  It is that their greed and incapacity destroyed the financial underpinnings of the rest of the economy, so that jobs the US used to create at fairly robust levels no longer appear.  IOW, the OWS critique of the finance crowd is that what they did screwed the rest of us — and that critique is correct, however much Mean Girl in Chief McArdle wants to distract us with the idea that the greedy old Social Security and Medicare receipients and the stimulus in response to the bankster-led crisis is actually the problem.  We’ll argue later about who to blame, she says, but for now let’s not fall prey to childish insults to the poor banking sectors.
Working this out is really not that hard — unless one is trying to make sure that no one actually pays attention to what happens and who is to blame when a handful of the most richly compensated members of a society f*ck up their one job, whilst looting the till.  But reality is a stubborn thing, and the greed and incompetence of the bankers is by now well documented, including,  for just one example, this pretty blunt piece from the archives of McArdle’s own employer.
          ¹Number of bachelors degrees awarded in the US in 2008-9: 1,601,368.  Number of such degrees in the fine arts: 89,140 (classified in these statistics as visual and performing arts, but matching the profile of the BFA degree).  Whatever else they are, (talented and monomaniacal, sez one married to a holder of an MFA), fine-arts graduates are unlikely to dominate the revolution, just on the numbers.
McArdle’s sneer at the arts is even sillier, in fact, when you actually look at the difference between a BFA and a BA.  The BFA curriculum, which typically demands studio and/or practice courses as well as more traditional classroom inquiry is classified as a professional rather than a liberal arts curriculum.  The folks who sign up for a painting BFA know they want to paint, and have some idea (usually a pretty good one) as to what that means — and they have an understanding of the working life they will enter.
McArdle might have been rhetorically better off dissing her own chosen undergraduate field of English literature — except that there are plenty of people who actually understand what a literature degree is supposed to do, which is not to guarantee an income, but to give you intellectual resources you can apply in the professional setting of your choice.  But imagining that people she disdains might actually have an autonomous inner life is beyond her vapid inability to grasp the fact that the world is not simply what she thinks it ought to be.
          ²The data here are a bit more complicated than they might at first appear — but a simplified picture is still a pretty good indicator of what’s going on.  And that would be that it’s not that students a generation ago made the same mistakes but were bailed out by the Bush casino economy.
In this study that looked at the period from 1993 to 2006, you see both an increase in the amount of debt and a shift in the mix of students graduating with high debt loads, with the debt burden in constant dollars rising sharply over those years for every quartile in the study.  All of which is to say that it isn’t that recent grads somehow made the same mistake their elders did and got burned; actual changes in the way the US invests in and builds human capital left them more vulnerable than their predecessors.
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73 replies
  1. 1
    kindness says:

    Oh if only I could comment at Megan’s site. I can’t any more. They 86’d me after I commented upon what a hack she is. Mind you, I always sourced my criticisms with links & data.

    She isn’t just wrong, she’s extremely thin skinned. How does that work in today’s blogsphere?

  2. 2
    Villago Delenda Est says:

    McMegan coming down on the side of the parasite overclass is every bit as predictable as the sun rising in the east each day.

    That’s she’s both dramatically wrong about everything and totally oblivious to her many errors in formulating her opinion also falls in the same category.

  3. 3
    LGRooney says:

    She’s suffering from a jealousy of Bobo. “Why should he collect all the Koch cash? After all, I have an ass laden with faux-stories of life among the proles, too.”

  4. 4
    Brian S says:

    She’d probably have been even better off dissing the vaunted Business degree–not the specialty versions like Accounting, but the generic Business Administration degree which a lot of my former students got, and with which they are continuing their careers in the retail sales field or something similar.

  5. 5
    soonergrunt says:

    @kindness: you pre-answered your own question.
    “Oh if only I could comment at Megan’s site. I can’t any more. They 86’d me after I commented upon what a hack she is.”

  6. 6
    scav says:

    She decided to have terrible grades and is faithfully maintaining the tradition of earning them the hard way.

  7. 7
    Linnaeus says:

    McArdle might have been rhetorically better off dissing her own chosen undergraduate field of English literature—except that there are plenty of people who actually understand what a literature degree is supposed to do…

    There was a time when pundits on American right understood what a literature degree was supposed to do, or at least offered arguments about what a lit degree was supposed to do beyond “hurr hurr silly English majors!” But that was the right of the 1950s and 1960s, and times have changed.

  8. 8
    Cacti says:

    If the financial sector wasn’t responsible for the subprime crisis that cratered the national economy, then who was?

    Underpants gnomes?

  9. 9
    BGinCHI says:

    Status Quo! says the status quo.

    They don’t stop paying you for writing what the overclass wants to hear.

    Other kinds of puditing are hard.

  10. 10
    catclub says:

    Tom, If you are going to use a chart that ends in 2007, to prove that inequality now is greater than in the late 90’s, at least mention that fact. During those 4 years after 2007, something _might_ have happened to change the overall conclusion. My understanding is that 2008-9 were bad for the oligarchs, but 2010 and this year have been very good to them.

  11. 11
    clone12 says:

    McArdle=Salacious B Crumb

  12. 12
    beltane says:

    I’d love to see this idiot be abruptly weaned from her corporate welfare gig and be forced to make it on her own in the real world. She certainly doesn’t seem to have the skill sets needed to hold on to any service sector job and it’s hard to imagine anything this pampered, whiney dumbass could excel at.

    She has all the makings of a waitress from hell.

  13. 13
    Tom Levenson says:

    @Cacti: Barney Frank. And Bill Clinton’s clenis.

    SATSQ.

  14. 14
    catclub says:

    @Cacti: ACORN, silly.

  15. 15
    Tom Levenson says:

    @catclub: Not sure why I need to mention something clearly visible in the chart.

    What I should have said is that the 2007 data is where the CBO report release last month ended its analysis.

  16. 16
    Egilsson says:

    McArdle has always been terrible and sloppy, but she’s really on a streak lately.

    She was chortling about “catching” Cohn in a pretty minor clarification about whether a health care report had been officially repudiated by the firm itself, or whether it had merely been debunked by everyone else and then that debunking was confirmed by anonymous members of that firm. Wow, what a catch.

    And yet she can’t begin to bring even that level of precision to her own garbage, including her ridiculous post about how the inequality gap is lessening thanks to the recession.

    I sometimes read the comments on her blog just to see her getting smoked there (even though she bans people who torch her).

    Mostly I’m amazed that someone who is clearly a 3rd rate intellectual and writer appears to garner a plum post – much less a job. I don’t find her observations to be insightful or thoughtful.

    In contrast, Andrew Sullivan drives me nuts sometimes, but he’s honest and insightful. When he’s wrong, he’s really wrong, but he’s right more often than he’s wrong. I hate all that Burkean faux intellectual nonsense though…

  17. 17
    beltane says:

    @Cacti: You don’t know the answer to this? It was all the fault of the poor people. How could banks gotten into trouble with risky loans if there weren’t any poor people to for them to engage in usury with?

  18. 18
    Walker says:

    How did someone with poor grades and a major in English become an IT consultant? Which HR department thought that would be a good idea?

  19. 19
    Tom Levenson says:

    Mostly I’m amazed that someone who is clearly a 3rd rate intellectual and writer appears to garner a plum post – much less a job.

    She serves a useful purpose as a major cog in the noise machine.

    It comes at some cost to The Atlantic’s credibility, though, which is not a good thing for the writers I do admire over there.

  20. 20
    Villago Delenda Est says:

    @Cacti:

    Brown people holding loan officers at gunpoint, forcing said loan officers to give them mortgages for McMansions.

    On edit: it seems that others beat me to this essential point of why there was a housing bubble explosion in the late aughties. Refreshing fizzy beverages are on their way to you as I speak…

  21. 21
    Steve says:

    Egilsson, Sully is willing to listen, but often way too late, and you have to beat him over the head with it or he’ll dig in.

    Megan, on the other hand, always digs in.

  22. 22
    Svensker says:

    @Cacti:

    If the financial sector wasn’t responsible for the subprime crisis that cratered the national economy, then who was?

    Teh blacks and teh gummint. Don’t you know anything?

  23. 23
    Brian R. says:

    Christ, what a fucking idiot.

  24. 24
    Short Bus Bully says:

    Great post. I know you think you’re just butting your head against a wall with this stuff, but you’re now Matt Taibbi to Megan’s Tom Freidman.

    Don’t let her up off the mat.

  25. 25
    DS says:

    Why the fuck doesn’t the Atlantic hire Mike Konczal or someone from Zero Hedge, you know, people who actually understanding economics and economic theory to, um, write about economics and economic theory? There is only one reason: the she is a ‘libertarian’. Meaning the same people on the right who complain about affirmative action usually benefit from it in the media because of ‘balance.’ She is a terrible writer, a terrible thinker, a horrible mean person and one of the reason’s why I have not even thought about reading the Atlantic for a few years now.

  26. 26
    Msut says:

    She was born rich of course.

  27. 27
    Downpuppy says:

    Acch, numbers. Anyhow, nice chart, but you may have missed Megan using the climate deniers 1998 trick. She managed to find a chart that showed a dip in the top incomes from 2008-2010, and conclude that all will soon be well.

  28. 28
    Steve says:

    @Walker: Sadly, I have kept up on her somewhat since the post 9/11 days. She took classes after UPenn to become an IT consultant.

  29. 29
    trollhattan says:

    Has McMegan yet threatened to stride purposefully down to OWS with a two-by-four to set those DFHs straight? I’ve been waiting for that golden moment. In the meantime, Himalayan salt Popsicles for everybody!

  30. 30

    @Cacti:

    If the financial sector wasn’t responsible for the subprime crisis that cratered the national economy, then who was?

    “It was Barack Obama.” — Fox “New”, conservative talk radio, etc.

  31. 31
    Martin says:

    Wow. Basic failure to understand human beings there:

    * Income disparity, when employment is high, and therefore everyone has at least some income is tolerable.
    * Income disparity, when employment is low, and therefore lots of people have no income, is intolerable.

    In 1999, the unemployment rate in the US was 4.2%. That was the lowest since the 60s. Conditions to tolerate a high disparity were ideal. Today, conditions to tolerate disparity are about as bad as possible. McArdle, of course, is oblivious to this minor point of reasoning.

  32. 32
    beltane says:

    @Villago Delenda Est: It was the eeevil government that made them do it. Remember, in Miss Megan’s world there is no such thing as greedy rich people, only greedy poor people. I really hope this woman never reproduces lest we be subjected to endless whining posts about her horrible, exploitative nanny who dares to demand a day off from time to time.

  33. 33
    Steve says:

    @Downpuppy: http://www.tnr.com/blog/timoth.....inutes-ago

    Not that Timothy Noah is right about everything, but it’s a start.

  34. 34

    Curse you, Levenson! I’ve been working on my own income inequality piece, and I picked that self-same painting to illustrate it. There’s something about the sheep’s head and the whole display that prefigures A Modest Proposal, don’t you think? Especially when you remember (a) transubstantiation, and (b) who is referred to as the Lamb of God.

    Cannibals all.

  35. 35

    “Numbers suck, there’s, like, too many of them.” — Butt-Head channeling Megan McArdle

  36. 36
    Marty says:

    Not to defend Megan or anything, but if you want to plot that kind of data you should do it on a semi-log scale. When the top incomes are in the $M range, it’s sort of deceptive to plot it on a linear scale.

  37. 37
    Herbal Infusion Bagger says:

    “She’d probably have been even better off dissing the vaunted Business degree”

    McArdle’s career was launched by her spouting semi-digested bits of information she picked up doing her MBA at Chicago, not even realizing there’s Freshwater and Saltwater economics. I imagine she coasted on MBA projects where she corrected the spelling of the other team members with better math skills, which would be, umm, everybody else.

    The Chicago GSB should yank her degree before she degrades their brandname anymore.

  38. 38
    Tom Levenson says:

    @Downpuppy: Thanks. See update

  39. 39
    Tom Levenson says:

    @Marty: Well, if I were actually to break a sweat and plot it my own damn self, yeah.

    But you steal what there is lying on the bureau top, you know what I mean…

  40. 40
    J.W. Hamner says:

    I do really love that she thinks that there are cellists or painters or whatever out there who really really wish they had become hedge fund managers. I honestly can’t even imagine any of the BFA/MFA’s I’ve known even allowing that thought to enter their head. Artists are not idiots… they know it’s not a reliable path to a summer house in The Hamptons.

  41. 41
    Herbal Infusion Bagger says:

    “How did someone with poor grades and a major in English become an IT consultant? Which HR department thought that would be a good idea?”

    I’m guessing she worked for one of the Big 4/5 accounting firms consulting wings, which do mainly IT. Their business model is have one principal consultant in their 30s/40s tell a bunch of cheap 20-somethings what to do. The markup is higher on the 20-somethings than the principal, so the kids are where they make their $$$, even though the kids don’t know squat.

  42. 42
    Herbal Infusion Bagger says:

    “Why the fuck doesn’t the Atlantic hire Mike Konczal or someone from Zero Hedge, you know, people who actually understanding economics and economic theory to, um, write about economics and economic theory?”

    Because McArdle writes well. The content is drivel, but it’s nicely packaged, and the Atlantic’s editors don’t know enough to tell a glib MBA skating on what they dimly remember from the few econ classes they took and what they can convince old professors and classmates to explain to them, and someone who’s up to date on the state of economics as a discipline. See also Easterbrook as a science writer.

  43. 43
    Downpuppy says:

    @Steve: Noah says it well, but there’s a rather nasty script running on that TNR page.

  44. 44
    pragmatism says:

    @trollhattan: she is really trying hard not to slam the ows folks with mixed results. she throws some red meat to her empathy chip-less commentariat from time to time so they don’t revolt.

  45. 45
    Herbal Infusion Bagger says:

    IIRC, on the tumblr we are the 99% there was a woman with a BS in Biochemistry unable to get a job and doing internet pr0n to make ends meet. So much for the OWS being whinging BFA’s.

  46. 46
    FlipYrWhig says:

    At what point did McArdle “work[] with a lot of mostly blue-collar and first-generation college grads”? At her consulting firm gig? At any rate, I hate to break it to her, but everyone of sound mind in the 1990s really did hate the banking/finance sector and thought it was populated by sharks, assholes, and shark assholes. The movie “Wall Street” came out in 1987.

  47. 47
    Bill E Pilgrim says:

    Just posted by KThug, refuting someone else but might as well be hers.

  48. 48
    Martin says:

    @FlipYrWhig:

    work[] with a lot of mostly blue-collar and first-generation college grads?

    Dude, someone needs to mine that pink himalayan salt. And someone needs to use it to give it value. By that perspective, she and the miners are economically conjoined. Peers, even.

  49. 49
    Paris says:

    when I worked with a lot of mostly blue-collar and first-generation college grads

    You could stop there. She is a poor liar.

  50. 50
    Hungry Joe says:

    … even though in the late 1990s, income inequality was almost certainly worse than it is right now.

    My GOD, how I love McArdle’s “almost certainly.” With those two words she blurps out just about everything that’s wrong with her. She almost certainly could have done some research on income inequality — five minutes on the internet, say. Yet she almost certainly didn’t. And it almost certainly makes no difference, because she will almost certainly be blurping out more fanciful, unsubstantiated twaddle next week.

  51. 51
    Ozymandias, King of Ants says:

    @Tom Levenson:

    She serves a useful purpose as a major cog in the noise machine.

    It comes at some cost to The Atlantic’s credibility, though, which is not a good thing for the writers I do admire over there.

    Nonsense. The Atlantic officially joined the noise machine some time ago.

  52. 52
    FlipYrWhig says:

    @Hungry Joe:

    fanciful, unsubstantiated twaddle

    This should be a rotating tagline on her blog.

  53. 53
    Ozymandias, King of Ants says:

    @Tom Levenson:

    She serves a useful purpose as a major cog in the noise machine.

    It comes at some cost to The Atlantic’s credibility, though, which is not a good thing for the writers I do admire over there.

    Nonsense. The Atlantic officially joined the noise machine some time ago.

    P.S. Is anyone else around here having major blockquote-fail today?

  54. 54
    trollhattan says:

    @Hungry Joe:

    Count me as ready to award you one day’s internets.

  55. 55
    Berial says:

    Has anyone else seen this TED Talk: Richard Wilkinson: How economic inequality harms societies

    Gives a generic rundown of how economic inequality hurts first world countries. If you notice the USA is in the HIGH inequality zone. A rough paraphrase from the talk, “An American that believes in the American Dream should move to Denmark to achieve it.”

  56. 56
    NobodySpecial says:

    Megan should remember that not everyone has a cadre of semi-qualified friends to promote her into a plum job like she got. It’s not what she knows, it’s who she knows. Period. And thus has it ever been with Megan.

  57. 57
    RosiesDad says:

    Tom:

    Is it just me or does the link to the old Atlantic article not work?
    (It doesn’t work for me here or at your blog.)

    Thx.

  58. 58
    srv says:

    @LGRooney: Working theory here – is Megan just positioning herself to be Bobo’s heir?

  59. 59

    […] Commenter Downpuppy reminds me that McArdle has seized on data from the worst of the financial downturn to show that the […]

  60. 60
    Tom Levenson says:

    @RosiesDad: Fixt here; will be at my place.

    @Doctor Science: Great minds!

    ’tis a rich image, is it not. No reason not to use, IMHO — it will hardly wear out the internets.

  61. 61
    RalfW says:

    @srv: Bobo’s hair?

  62. 62
    dj spellchecka says:

    hungry joe basically beat me to it but before writing this: “Even though in the late 1990s, income inequality was almost certainly worse than it is right now,” couldn’t mcmegan have used google to check?

    good grief….

  63. 63
    jake the snake says:

    @srv:

    Working theory here – is Megan just positioning herself to be Bobo’s heir

    ?

    She will have to fight Doubt-that for it.

  64. 64
    Norwonk says:

    Once again, I can’t help being reminded of the time McMegan tweeted triumphantly:

    Ladies, tonight’s the night to recognize hubby for not sexting strangers from office w/identifiable pics. Praise is vital to a good marriage.

    Given her track record, it’s a near certainty that her hubby was sending naughty pics of himself to various ladies who were not Megan McArdle at that very moment.

  65. 65
  66. 66
    arguingwithsignposts says:

    Every time McMegan hits “publish,” the ghost of Ben Franklin dies a little inside.

  67. 67
    arguingwithsignposts says:

    @Herbal Infusion Bagger:

    Because McArdle writes well.

    Um, no. I’ve known many good writers in my time, and McMegan doesn’t even qualify to format their Word docs. She writes vast fog banks of faux intellectual nonsense. She’s a George Will starter kit, without the addiction to baseball.

  68. 68
    exlitigator says:

    Clearly the jobless graduates from prestigious colleges with huge debt should have chosen to got to a cheaper State school or community college. Likewise, the jobless graduates from cheap State schools and Community Colleges should have studied harder and gone to a better school.

  69. 69
    pseudonymous in nc says:

    She writes vast fog banks of faux intellectual nonsense.

    But she has fanboys. And fanboys will get you far, even if you’re a fatuous, silly person who makes Marie Antoinette look like a woman of the people.

  70. 70
    An Idiot says:

    So you might say that Megan McArdle is representing the 10%?

  71. 71
    wetcasements says:

    God she’s a fucking maroon.

  72. 72
    sneezy says:

    @beltane:

    She has all the makings of a waitress from hell.

    As I once said over at her place, she’d be the kind of waitress who, when you order a ham sandwich, brings you one slice of bread and an unopened can of tuna, then asks if you’d like to hear about her wedding plans.

  73. 73
    Batocchio says:

    except that there are plenty of people who actually understand what a literature degree is supposed to do, which is not to guarantee an income, but to give you intellectual resources you can apply in the professional setting of your choice.

    Great post, Tom, thanks. As much as I liked it all – and it saves the rest of us the trouble of writing another McArdle debunk – the passage above struck me, because sadly, McArdle is far from alone in not appreciating the value of the arts and humanities. (Then there’s conservative war on science…)

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