Income Inequality is a Bogus Issue
I have written many times that Obama is more interested in bringing the wealthy down than lifting the poor up. For example, in my article Obama is Just Like Franklin Delano Roosevelt, I wrote:
When told that raising taxes would absolutely, without doubt, reduce government revenues, he said he would do it anyway because it was the "fair" thing to do.
So rather than take an approach which would bring in more revenues to the government, Obama would prefer that the rich pay more simply because it would be "fair," even if it means less revenues to spend on the poor.
Now, in President Obama's State of the Union speech he promised to focus on income inequality (1). Obama's solution? Lower the rich instead of raising the poor.
That is always the solution of Communists, they are totally ignorant of the laws of economics and so when presented with short people and tall people, their method to make heights more equitable is not to help short people become taller but to cut off the legs of tall people. There! Now everyone is the same height.
But is income inequality a bad thing? Consider the Gini Coefficient which measures inequality of income or wealth among a given population. 0 corresponds to perfect equality (everyone having exactly the same income) and 1 corresponds to perfect inequality (where one person has all the income, while everyone else has zero income).
Based on the Gini Coefficient (GC), Afghanistan has one of the lowest GC numbers (27.8) which means that it has almost no income inequality compared to the United States (45) - that is to say the poorest man in Afghanistan has 3 goats and the richest has 5 goats; but who wants to live in Afghanistan?
But that's the problem with the concept of income inequality - it is completely meaningless. What country would you rather live in, the one where everyone owns at least one goat and nothing else but the richest don't own more than a handful of goats or one where 99% own a car, a tv, a computer, a cellphone, a fridge, but the 1% richest own a hundred cars?
Obama is focusing on the wrong end - don't look at what the richest have - look at what the poorest have. Improve the opportunity for the poor - not cut the legs from under the rich.
ENDNOTES
(1):
CNNMoney, 28 Jan 2014, Obama's soft sell on income inequality
President Obama's State of the Union speech was billed as focusing on income inequality, an issue he's promised to devote himself to addressing in 2014.
...
Today, after four years of economic growth, corporate profits and stock prices have rarely been higher, and those at the top have never done better. But average wages have barely budged. Inequality has deepened. Upward mobility has stalled. The cold, hard fact is that even in the midst of recovery, too many Americans are working more than ever just to get by -- let alone get ahead. And too many still aren't working at all.
