What bugs me about inequality debate is the lack of distinction between assets and income.
Some of us, make assets a proirity; real estate, equity and bonds. We save and defer to accumulate. Of course, including these items will distort the wealth quintile distribution charts being shown to us lately.
Then there is the corresponding income from assets. This needs to be stripped as well for comparison. Suppose I spend a lifetime of acquiring apartment buildings, living below my means. Then I reap the net rental income. This is a lifestyle choice, not a confering of wealth based on birth. Why is this in the equality comparison?
So the inequality charts should be based on income from employment (not benefits). We already know that the tax inequality pretty much is adjusted to take income from the upper quintile and give it to the lower.
What is the beef then?
Our financial reporters are smart enough to understand this. Over on Business Intelligence, for example they fail to normalize inequality for assets.
I have a feeling that this is the much anticipated punishment of savers movement. See Cyprus last year.
The main problem with this (as Thomas Sowell eloquently points out in his books) is that liberals take a snapshot in time and call the disparity between groups “income inequality”
What liberals (and others as well) don’t take into account is that people are constantly transiting in and out of different income levels. Someone who is in the low income level this year would hopefully move up as they gain job skills.
Conservatives don’t expect someone flipping burgers at McDonalds to work there for life and support a family, and we expect them to move up and out over time.
Liberals believe people should be able to flip burgers their whole life, make as much as a surgeon and support their families on it.
My beef with “income inequality” is even more basic.
Personal “income” is an outcome - of one’s working to maximize your value to an employer and one’s effort in supporting yourself.
Arguing for “income equality”, therefore, is arguing that everyone should make the same amount regardless of their effort to better themselves. It is communism, plain and simple.
America was founded on equal opportunity - not equal results.
I think the ultimate objective is to tax wealth (that is, assets) because so far the government has only been able to get at wealth through death taxes.
This, in fact, has been suggested by various left-wing world economic groups: a 10% tax across the board on the wealth of everybody who has over a certain (rather modest) amount.
This will fatten the bank accounts of governments worldwide and, in our case, give Obama and his family and all the other bureaucrats lots of fun in the sun on Hawaii. Don’t forget, it’s all about feeding the government and those chosen by the political power to get into the sacred halls of government. The supposed “victims of income inequality,” on the other hand, are not going to see a dime of it.
“We save and defer to accumulate.”
This is my philosophy; I’m not a university graduate because I’m not going to take out a loan for school. Hence, I don’t have a degree, but I am debt free.
Frankly I think it’s the biggest blessing in the world to be able to say that at my age (I’m 30).