It feels like we are instead bifurcating instead of regressing to a mean. The rich are getting richer and moving to one side together as a group, while the middle class and poor are merging the other way into their own "barely hanging on class", distributed around a point far on the other side.
The average going up doesn't mean it's a tide that raises all boats.
By what definition? It's certainly possible that some kind of societal bell curve or other distribution can just keep getting wider without meaningful movement of the relative positions of individuals. I don't understand why you assume the most likely behavior is regression to the mean. Especially on short terms that seems weird to assume
Punching down is clealrly a sign of things regressing. The Cantillon effect is what separates the rich and those aren't. Trickle down economics doesn't work. Imagine telling those barely middle and poor Americans you're still doing better than Thais or South Africans. It doesn't help.
The average going up doesn't mean it's a tide that raises all boats.