It may be all you need to look at if your goal is merely to scoff at the state of affairs and reaffirm your egalitarian self-identity.

If you want to thoroughly understand the problem so that you can reason intelligently about what a solution might look like, you'll probably want more data.

How can that be interpreted in a positive light to have all of the economic gains of a country going to a small few?

Because "income" does not equal "all of the economic gains of a country."

Lots of other things happened in the period in that graph which kept median incomes lower despite economic improvements taking place. Like:

1. The offering of health insurance as a tax-free employment benefit.

2. An increase in divorce rates (households all over cut in half but the median household income didn't drop; there must have been an economic gain distributed to not-rich people for this to happen).

Also, this graph doesn’t say anything about what happened to the size of each of these groups. Pretty sure the biggest trend in America has been the middle class splitting in half between people making more money (and thus becoming part of the "small few") and people making less (which worsens income inequality even though more people are now "rich").

So yeah, there's a lot missing from these graphs.

The goal of the graph is to generalize large scale income distributions/gains on a large sample size of hundreds of millions of people.

Not to go into every single micro sub group of income earners and divorced neurologists with company sponsored health insurance who have more income than an tech worker homeowner with 6 cats.

The graph is perfectly valid for what it represents. The share on a large sample size of hundreds of millions of people of historical income gains and results can be interpreted thusly.

I do t think these charts take into account benefits (I.e. Health insurance) which means that for many people income has not grown, but total compensation has grown, those workers just didn't get to choose where to spend it...

Indeed. In fact, the footnote for that chart acknowledges that:

> Income differences narrow when all taxes and transfers—such as health insurance and in-kind government benefits—are included

https://www.minneapolisfed.org/publications/the-region/where... expounds on a few of the things that have caused household take-home pay to stagnate. The tl;dr there though is:

> Average household size declined substantially during the past 30 years, so household income is being spread across fewer people. The mix of household types—married versus single, young versus old—also changed considerably, so the “median household” in 2006 looks quite different from the “median household” in 1976. Finally, the measure of income used by the Census Bureau to compute household income excludes some rapidly growing sources of income.

Which is all to say that it's a bit more complex than a few charts might immediately make it look. Income inequality has certainly seen an increase, but it's incorrect to characterize it as the upper decile bleeding all the benefits out of the rest of the economy.

In my view health care should be added to inflation. Then the chart would look even worse

Inflation is a monetary phenomenon that affects all prices in the economy. If there's only a price increase in one sector it's by definition not inflation.

Not true. When the oil crisis hit in the 70s for example, inflation spiked. OPEC wasn't a monetary phenomenon.

OPEC did not cause the inflation, nor did the increasing price of oil. During the same period, the US fully abandoned the gold standard and the Federal Reserve pursued a policy of loose money. Here's a brief history:

http://www.investopedia.com/articles/economics/09/1970s-grea...

Wealth is an asset. Health care insurance is not listed as an asset in accounting, it's a risk mitigator, and the premiums are expenses (typically employer expense, is an employee benefit and in the U.S. it's an untaxed benefit but it's still not income on a profit and loss statement, and it's not an asset on a balance sheet).

In that case, think of that chart as representing "buying power," rather than "income."

That doesn't make sense, though, because if your buying power remains stagnant, but you suddenly don't need to buy health insurance with that buying power (because it's handled in the form of pre-takehome compensation), then hasn't your net buying power increased?

No, because the buying power of everyone has gone up in most areas thanks to innovations in technology and entrepreneurship duing the period in the chart.