Occasionally, the standard of living of the very rich is revealed not by a singular event of individual extravagance—like a wedding or a birthday party—but by the routine functioning of one of the markets in which only the super rich (and the institutions that benefit from their largess) participate. A recent auction of Impressionist and modern art at Christies was such an event. Seventy-eight lots of artworks sold for a total of almost $500 million, $200 million above the previous auction maximum reached in 1990. Again and again, pictures sold for more than their expected value: a Klimt that had been predicted to fetch $40 to $60 million sold for $88 million, a Kirchner expected to sell for $18 to $25 million went for $38 million, and so on.

There is nothing wrong with this display of fabulous wealth, of course. The purchase of beautiful art to donate to a museum surely is a generous gesture. The auction is of special interest, though, because it underlines how well those at the top of the income distribution have been doing.

Many commentators have pointed out that most of the increases in family income over the past 30 years have gone to families with incomes in the top 5 percent. While the bottom 90 percent of taxpayers showed essentially no increase in income between the early 1970s and today, those in the top 5 percent (those with current incomes above $120,000 a year) have enjoyed increases of about 80 percent, while the richest 14,000 taxpayers (the top one hundredth of one percent, whose incomes exceed $5 million) have seen their incomes climb roughly five-fold.

What this statistic fails to record is that these wealthy families have done even better than their income growth indicates. Even while their monthly income has soared, the value of their property has increased as well. Certainly, periodic crashes in the value of stocks or housing can put a temporary damper on the growth rate of wealth, but overall, wealth has boomed for those who have it. And wealth is highly concentrated, with the bottom half of the population owning essentially no wealth: their assets are offset by their debt.

Income, as official statistics record it, includes realized capital gains—the increase in the value of an asset bought in the past and sold this year at a higher price. Income does not include capital gains that are not realized. So if the value of property is rising, the families benefiting from this appreciation of property values will enjoy wealth increases that are unrecorded in income statistics. Only when some of this wealth is sold will capital gains be realized and recorded.

The auction at Christies offers the rest of us a glimpse of what is happening to wealth at the top of the distribution. Markets for collectibles remain buoyant. There is a lot of money ready to buy Gauguins and Klimts, Caribbean islands and private jets.

These facts about whom economic growth has benefited over the last three decades should inform decisions when we decide how to structure our tax system. Oddly, perhaps, the tax cuts of 2001 and 2003 were most generous to those at the very top of the income distribution. By proposing to abolish the estate tax, on top of the cuts in the tax rates on dividends, capital gains, and other income, the tax reform agenda of the administration shifts the burden of taxes to those who have benefited least from recent economic growth—the poor and the middle class—from those who are lucky enough to be able to buy paintings at $50 million a pop.

Bernard Wasow is a Senior Fellow at The Century Foundation.