[Viking2002]

I'm no Donald Trump, but what do I think about income inequality? I think you should get off of your dead ass and go earn some income.

Clear enough?

[FITZ]

The very rich and very poor are okay if they are a small percentage of the people --- all countries have the rich and poor --- what is important though is having a large, employed, and fairly happy middle class.

[LowCountryJoe]

PoliSci"Graduate"Student, I know that you said you had a lot of studying to do but I do hope you come back to check on the thread from time to time.

I don't know if it's already been written by someone and I'm not going to read thoroughly read through all the responses but there is one theory as to why the income gap is widening: The theory is that since the early 70s with the women's liberation movement, more and more women fore-go starting their families in their 20s (and sometimes altogether) and now concentrate first on getting and education and well compensating career. And, these career women tend to meet and marry men of a similar socioeconomic stratus. The two combined incomes of highly educated, well compensated people will be significantly higher than that of two individuals that are less educated and compensated.

But while these iniquities may seem unfair and may lead some to conclude that this trend will lead toward a caste system, the truth is that family wealth tends to evaporate past a three generation span. For whichever reasons, whether hardship leads to increased desire to excel or the children's children of the wealthy form bad habits and piss away their wealth, things never stay static. Reversion to the mean is always a factor that is in play.

Even during one's lifetime, there are many cases where one passes through the various income levels, not staying put in a particular class.

[Constitutional Patriot]

The very concept of "income inequality" suggests marxism. In the natural state of humanity, there will always be an "inequality" because everybody is doing something different to make a buck. The guy who fixes cars will make roughly $X ($X to the 3rd power for my car guy...) while the guy who went to medical school to be an oral surgeon will make $6X because his skills are less common and, hence, more valuable (assuming they are in demand...rare skills do not guarantee big $$$, just ask any Mime in Central Park).

Equal income can only exist in theory. The theories (ideologies) where it exists have been disproven throughout the last century (at the unfortunate cost of about 100 million lives).

[tubebender]

What do people think about income inequality?

It doesn't bother me as long as I have the opportunity to make a $100 more than the riches of them...

[Choose Ye This Day]

The rich "own" most of the wealth in this country? What does that even mean? Who created the wealth?

Here's a nifty little parable that illustrates the folly of your redistributionist tendencies:

Let's put tax cuts in terms everyone can understand. Suppose that every day 10 men go to a restaurant for dinner. The bill for all ten comes to $100. If it was paid the way we pay our taxes, the first four men would pay nothing; the fifth would pay $1; the sixth would pay $3; the seventh $7; the eighth $12; the ninth $18. The tenth man (the richest) would pay $59.

The 10 men ate dinner in the restaurant every day and seemed quite happy with the arrangement - until the owner threw them a curve. "Since you are all such good customers", he said, "I'm going to reduce the cost of your daily meal by $20." Now dinner for the 10 men only costs $80.

The first four are unaffected. They still eat for free. Can you figure out how to divvy up the $20 savings among the remaining six so that everyone gets his fair share? The men realize that $20 divided by 6 is $3.33, but if they subtract that from everybody's share, then the fifth and sixth men would end up being paid to eat their meal! The restaurant owner suggested that it would be only fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay. And so now the fifth man paid nothing, the sixth pitched in $2, the seventh paid $5, the eighth paid $9, the ninth paid $12, leaving the tenth man with a bill of $52 instead of $59.

Outside the restaurant, the men began to compare their savings. "Hey, I only got a dollar out of the $20," complained the sixth man, pointing to the tenth, "and he got $7!" "Yeah, that's right," exclaimed the fifth man. "I only saved a dollar, too. It's unfair that he got seven times more than me!" "That's true," shouted the seventh man. "Why should he get $7 back when I got only $2? The wealthy get all the breaks!"

"Wait a minute," yelled the first four men in unison. "We didn't get anything at all. The system exploits the poor." So, the nine men surrounded the tenth and beat him up. The next night he didn't show up for dinner, so the nine sat down and ate without him. But when it came time to pay the bill, they discovered something really important. They were $52 short!

And that, boys, girls and college instructors, is how America's tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just might not show up at the table any more. There are lots of good restaurants in Switzerland and the Caribbean!

It's just about that simple. The rich guy has more because he has earned more and created more. He even pays more for the basic services that everyone else enjoys. Yet the other 9 always want to beat him to a pulp. Pretty soon, he won't want to sit at the same table.

Or, as in Atlas Shrugged, he may just withdraw from the game all together.

[MarkL]

According to the US Treasury Department, the richest 2% of the country own 80% of the wealth in the US. That's honestly not just some liberal's opinion, that's really true, you can check the statistics yourself if you don't belive me. Flip that around and that means that the remaining 98% of us have only 20% to go around amongst all the rest of us

the problem with this method of thinking is that it assumes that all wealth is static. That today there's $X gazillion of wealth in the country, and that's all that there will ever be. That's the problem. Wealth is created by work. Although I realize that most leftists feel this way, even Karl Marx recognized that wealth is created by the labor of the prolitariat. His problem was that the wealth created was not kept by the laborer.

Here's an example... You pay $100 for raw lumber. Now, given your line of thought, the table created is worth only $100. But that's not the case. You've created wealth. Using your skills as a woodworker, you create a fine dining room table that you sell to a distributer for $300. Why? Because you realize that the table is actually worth $600, but you don't have a way to market it to greater numbers of people. So you get the $300, giving you a profit of $200. And you then work to increase your own wealth, so that you will eventually be able to do the distribution yourself, so that you will be able to keep the $500 of profit.

Here's a real world example of the fallacy of your opening statement... I've got a friend that I've known since 1984. We both quit college at about the same time. In the late '70's, he had began working at a dental lab, making minimum wage. While he was in college, he continued to work part time, and after dropping out, he worked full time. Over the years, he learned more skills, becoming more valuable to his employers. This increased his value to to his employers' competitors, and over the years he moved to new dental labs a number of times, other times, he just got hefty raises and bonuses. Well, here we are, twenty years after first having met, and the two of us were voted "least likely to succeed" by many of our peers. Well, Pat is now a partner in a dental lab, taking in nearly $85,000 a year in salary and bonuses, and he's got two houses (one at the lake), along with two boats for the lake house (a bass boat, and a skiing boat)... Oh, yeah, he's happily married with two kids. Well, given the opening premise about wealth, Pat should never have been able to get where he is today. It wasn't about luck. It was his drive to succeed. And that's how wealth is generated and accrued.

Mark

[jeremiah]

I seriously don't worry about the inequality of income. Just get the govt and the regulations of business out of the way, and there will be even more rich......It all depends on how hard one is willing to work.

[DoctorMichael]

Eat the poor. Our Welfare payments have been fattening them up for decades.

[elisabeth]

A few thoughts for you:

1) You state that a small portion of the population controls a large portion of the wealth. But you must keep in mind that the top 5% of wage earners pay 53% of the income taxes, and the top 50% of wage earners pay 96% of income taxes. Thus, we already have a highly progressive tax system. These are IRS statistics, a summary of which can be found at http://www.rushlimbaugh.com/home/menu/top_50__of_wage_earners_pay_96_09__of_income_taxes.guest.html

2) You must ask yourself the following questions: Do we as humans have the moral obligation to help those less fortunate than ourselves? And more importantly, do we have the right to force others to help those who are less fortunate? As a free individual, I contribute both time and money to various charities. I detest it, however, when the government takes my money to do so, and I see this as a breach of personal freedom.

3) If you were living in Europe, you'd be getting a free ride and then some on your college experience. But guess what? European Universities pale in comparison to U.S. universities. Going to university is not a "right." Don't you feel a little bit wrong about the scenario of other people paying for your university tuition? I wanted a college degree and a masters, so I went and got one, and my parents and I all busted our butts so have enough money for me to do so.

So does it bother me that there are poor people? Yes. Do I want the government to take my money to try and solve this problem? No. Think about the importance of freedom, and being able to make individual decisions about what you do with your money, where you work, etc. Read some Milton Friedman and maybe Reason magazine, and keep coming back to FreeRepublic, as you have generated some good discussion!

[SteveAustin]

Wow...I just picked up on this thread. Poli-Sci, you definitely came on here to stir things up, but good job. There are some great responses by many on this thread.

I agree with 95% of the prior posts as it relates to hard work and free enterprise. That said, I do think that the US is potentially facing a tough time in the next few years as we now face 2 Billion people in India and China who are much more free to sell their services on the world labor market.

One reason for the political stability in the US is the fact that we have many different forms of wealth that people can work they way into(small business, public stocks, real estate, pensions, etc.) It helps support a strong middle class.

I am somewhat concerned that many US workers who the last 50 years have had a good middle class existence are going to find it hard to keep up with labor in China and India that costs $50 a week for an educated laborer.

Greenspan can talk all he wants about the buggy manufacturers finding new jobs in the auto industry, but I think this is a different issue....and one that doesn't have any easy answers. I do have some concerns about political instability in the future.

But, going with the line of many posters, I also worry about how "representative" our government will be in the future if over half the country effectively doesn't pay income tax anymore due to higher brackets and the earned income tax credit. Everyone should pay income tax in some form.

[LowCountryJoe]

There's something about that "80% of the wealth being held by only 2% of the people" citation that just reeks of bullsh*t, after all 62% of the adult population own there own homes. But I'll play along with the citation. Let's suppose that those 62% of these home owners still are financing 80% [I'm starting to tire of the percentage game here] of their home values through their bank. And most of these owners are making the mortgage payments with a paycheck that provides 100% of the crap that they need to live on [notice I didn't write "...want to live on."].

Who do you suppose provided the capital necessary to fund the firm that provided the job in the first place?

Finally, who provide the Treasury with the money - that was so frugally managed with superb stewardship I might add - that allowed the United States of America to train and maintain the best military in the world. The very military that protects our sovereignty and the very same freedoms that allow you to express your "class envy".

In a round about, indirect way, you're biting the very hand that feeds you.

[raloxk]

Income inequality is the result of economic freedom

[Quix]

I may not win any friends among my Conservative peers hereon . . . but here goes.

I'm torn.

I believe the workman is worthy his hire. And, even people like rock stars, sports stars, software gurus etc. who churn out a product that benefits 10's to 100's of millions of people are due a portion of the cost each individual benefitting pays. I think that's a pretty solidly sound principle. Otherwise, why bother being creative. Be a well paid garbage collector or plumber and be done with a lot of other hassles.

On the other hand, 2% having 80% of the wealth seems extremely excessive.

And, in the New Testament, The Church had all things in common. God is not at all thrilled with our citizen's; western Society's; human nature's addiction to the gods of materialism. HE WILL BE INSURING WITHIN A RELATIVELY FEW YEARS THAT AUTHENTIC BELIEVERS ONCE AGAIN HAVE ALL THINGS IN COMMON in the USA. There will be no other viable way to handle the situations that will be arising.

And, after that horrid TRIBULATION, Christ's eternal Kingdom will clearly do things perfectly.

But to be more hypothetical as though I were rewriting the rules for our Republic at the outset . . . I think I'd try and get something like the following implemented.

---

1) Individuals who make 20-40 times the MEDIAN OF THE LOWER THIRD OF WAGE EARNERS would have 8 years of unfettered consumption at those rates of income.

The last 2 of those 8 years, a committe of a cross section of one's citizen peers of the most RESPECTED, HUMBLE, ALTRUISTIC OF THE CITIZENS IN THAT LOCALE AS DESCRIBED BY THE LOCAL POPULATION would examine the accounts and expenditures of the individuals concerned.

If there was a clear trend of spending at least 1/4th of said income in behalf of others and the public good, then said wealthy individuals would be allowed to continue to spend more or less unfettered with only yearly review for another 4 years.

After 4 years, the proportion of their income spent in behalf of the public good would have to go up to 35%. If it had gone up to 34% within the last year of those 4 years, the individual would be granted another 4 years of only yearly review.

At the end of that 4 years--16 years total--the proportion devoted to others and/or the public good would have to reach 55% within the last year of that 16th year. Then, another 4 years would be authorized with merely yearly review.

The last year of that 20th year, the individual would be required to demonstrate 70% of their income being devoted to others and/or the public good. If so, the individual would be authorized 10 years of additional unfettered spending at their own discretion with merely yearly review by their peers. Every decade thereafter until their death or dramatically less income [to be defined], they would have a review to asses whether they warranted by virtue of the wisdom of their impact on the public good, another 10 years of rather unfettered management of their own expenditures.

2) UPON THEIR DEATH, inheritance would pass as designated in their wills. Massive wealth could be inherited. However, the 3rd year after the inheritance was passed, a committee of peers would assess how wise the inheritee was using the wealth for his own life as well as for the public good. If the consensus was positive, the inheritee would be authorized another 5 years of relatively unfettered management of the wealth. At that point, the same process per above would apply.

---

3) Individuals who have income 40-60 times the MEDIAN of the LOWEST 3RD income group in the population at large would be allowed 5 years of unfettered management of their wealth with committee a review beginning the at the end of the 3rd year and also at the ending of the 4th and 5th years. At the end of the 5th year, if the consensus was positive, the individual would be allowed an additional 5 years of managing their own wealth unfettered.

At the end of every year following the end of the 10th year, a similar review would occur. Unbinding feedback would be given yearly. At the end of every 5th year until 15 years total, a positive consensus would be necessary for continued unfettered managment of their own wealth. During the 14th and 15th years, it must be demonstrated that they are beginning to insure that at least 30% of their income is devoted to others and/or the public good.

At the 19th and 20th years, it must be demonstrated that they are beginning to insure that at least 60% of their income is devoted to others and/or the public good.

At the end of the 24th and 25th years, and for every 5 year segment thereafter, it must be demonstrated that they are devoting 80% of their income to others and/or the public good.

Inheritance would be as above except that consensus required reviews would occur every 2 years for the first 10 years the inheritee managed the wealth. After that, the inheritee would be on the same program as the benefactor was before their death.

4) All those who's income was beyond 40% TIMES the MEDIAN income of the poorest 1/3rd of the population would undergo consensus required review every 2 years after an initial 5 years of unfettered management of their own wealth. And, they would have to devote 90% of their income to others and/or the public good after 20 years of income at the 40%+ level.

---

5) The peer review committee members would serve 16 years after which 1/4th would be rotated off every 4 years. Their income during years of service would be 3% of the incomes of all those they reviewed during the year. They would not have their expenditures reviewed except once at the half way point of their term and at the end of their term to insure there was no conflict-of-interest or other less than humble and altruistic management of their incomes.

Their deliberations would be highly classified. They would have a support staff chosen individually by them and that staff would also retire with them. The support staff would each receive 15% of the amount of income of the committee member they supported.

A monitoring mechanism and group--non permanent in terms of individual terms of duty--would be developed to insure that committee members and staff maintained the highest of morals and ethics at all times.

Taxes of the total population would be based on either a flat 15% tax or some fitting percentage OR a transaction tax.

Charitable and other public works organizations and projects would be open to contributions from all citizens, including the wealthy as outlined in general terms above.

Citizens amassing massive wealth would not be required to turn over major portions of it to a government bureaucracy which would inevitably manage it worse. Nevertheless, the opportunity to freely amass such wealth must at some point carry with it compelling pressure to apportion increasing amounts of it for the good of others and/or the public good.

Probably individuals skilled at amassing such wealth would be much better than government bureaucrats at insuring that genuine public good arose from their wealth.

---

anyway--so much for off the top of my head.

[LowCountryJoe]

...and am having to borrow $20,000/year to make my tuition payments...

It must be a loan from one of those damn 2%, the bastards!

[aruanan]

What do people think about income inequality?

Income isn't something that, like air or water, exists in and of itself or that each and every person has some kind of equal claim so that if person A has twice the income of person B, person A must be preventing person B from getting his fair share. Income is a measure of a person's ability, skill, and productivity. You may as well ask what I think about ability inequality. If someone has the ability to create a multi-billion dollar business that provides employment and goods and services, then that person deserves every bit of the millions or billions of dollars he is able to generate for himself through that business. If another person has only the ability to work a forty hour week stocking shelves in that business, then he deserves no more income than what that level of labor will generate. Are their abilities and incomes unequal? Yes. Is the inequality unfair? No.

[White Eagle]

Live by statistics, join John Dean's campaign by statistics. All the numbers and percentages you quote about the US are quoted in a vacuum, with the assumption that this mix is unique to the US and not common elsewhere in the world.

Is that true?

[Preech1]

Ping for potential Zotting in the future...just so I get in before things go weird.

[slohand]

To change the subject slightly. Liberals say that Bush is responsible for the economy starting from the day he was inaugurated. I believe you can tell how good a president was by how good the economy was after he left. By this grading Reagan was the best domestic pres ever. Athough bush 41 did put a dent in the economy with his tax increases the economy Clinton left has to be one of the worst

[JoeGar]

At the same time, human resources staff for Wal-Mart, when they hire a new employee, will routinely complete paperwork for new hires to receive foodstamps, as the wages they pay their workers are so low that, even as full-time employees, they are assured of falling below the poverty level and qualifying for foodstamps, without which they wouldn't even be able to afford to feed their families.

Not true -- unless the employee's family size will qualify them for food stamps. People shop at Wal-Mart because low prices enable them to buy more stuff with their paycheck. Buying more stuff employs more people to make more stuff for the shelves. Low prices creates more wealth for more people. (You need to take a few Econ courses before trying your hand at PolySci.)