Rating: 
Summary: Happy talk, picked out of the air.
Review: This is a profoundly devious book. The authors make no attempt to be scrupulous in presenting their data, nor do they acknowledge any writers who disagree with their perspective (except maybe to mock them). For example, their chapter on income distribution, which originally appeared in the Dallas Fed's 1995 annual report, was shredded in a widely circulated paper by Boston College economist Peter Gottschalk. Mobility studies are very sensitive to definitions, time scales, and data quality. Honest researchers slice the data several ways to see how robust the findings are; not Cox and Alm. They used all the sensitivities to their own advantage. They're on an ideological mission Cox & Alm stack their results in several ways. By making individuals, not households, the focus of their analysis -- which they say is standard practice, though it isn't -- subjects as young as 16 qualified. So the lower ranks were swelled by teenagers who contributed vastly to mobility just by growing up. To compare incomes over time, they used changes in real (inflation-adjusted) incomes over time, rather than comparing them to prevailing averages of each moment -- that is, they measured changes in absolute rather than relative incomes. While absolute changes matter some, most people judge their status and well-being against the rest of society, not against an ancient base fixed by a statistician. Gottschalk's reworking of the numbers massively deflates their claims. Cox and Alm found that just 2% of those in 1975's bottom quintile remained there in 1991; by Gottschalk's calculation, 36% were. And instead of 39% ending up in the richest quintile, just 20% did. With relative measures -- which Cox and Alm don't use, of course -- 43% of 1975's bottom quintile would have remained there in 1991, and just 11% would have hit the top. Yet the Dallas Fed version seems to have been incorporated wholesale into the book. Gottschalk's critique isn't even acknowledged, much less responded to. And that's just one chapter. Read this, if you do at all, with only the most skeptical eyes.
Rating: 
Summary: attacks the myths
Review: We all hear about how the Japanese make better cars, we cannot compete in the steel industry, Indian engineers work for less, our graduate schools are filled with Asians, etc. People use these as evidence that the U.S. is no longer competitive and that we are losing our position as the most powerful economic leader in the world. This is pure nonsense.
The two authors go through a detailed explanation of why the U.S. is better off now than it ever has been. Some of the critics of this book say that we are doing so well now because of government programs. Well how do these people explain the success of the U.S. before FDR and Johnson. The Great Depression is also proof that the government shouldn't meddle with a capitalist society.
This book should be read by anyone who hears the media's and polticians'spin on the welfare of the U.S. The U.S. is still the most powerful economic giant in the world and the facts are there to back it up. Some people can spin some stats to show that we are not doing as well as we think, but it is just spin and I truly believe that these people just want the U.S. to be less powerful because they dislike the success of our country.
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