Income Inequality

http://www.futureofcapitalism.com/2011/01/income-inequality

The New York Times steps up its campaign against income inequality, throwing Nicholas Kristof into battle to reinforce Frank Rich and Eduardo Porter. Mr. Kristof's column doesn't distinguish between equality of opportunity and equality of results, between income inequality, asset inequality, and other types of inequality, or between pre-tax, pre-transfer income inequality and post-tax, post-transfer income inequality. The column also says that "the gap between rich and poor fell during the Clinton administration," without much useful explanation of why, or of what measure is used. Most other accounts I have seen say pre-tax, pre-transfer income inequality rose during the Clinton administration, though it may have narrowed somewhat at the very end because of the collapse of the tech stock bubble.

The Times also allots some space to Harvard economist Gregory Mankiw to push back. He advises President Obama:

Ever since your famous exchange with Joe the Plumber, it has been clear that you believe that the redistribution of income is a crucial function of government. A long philosophical tradition supports your view. It includes John Rawls's treatise "A Theory of Justice," which concludes that the main goal of public policy should be to transfer resources to those at the bottom of the economic ladder.

Many Republicans, however, reject this view of the state. From their perspective, it is not the proper role of government to fix the income distribution in an attempt to achieve some utopian vision of fairness. They believe, instead, that in a free society, people make money when they produce goods and services that others value, and that, as a result, what they earn is rightfully theirs.

by Ira Stoll  |  Jan 1, 2011 at 8:48 pm Related Topics:  Income Inequality receive the latest by email: subscribe to the free futureofcapitalism.com mailing list