Kathianne
12-20-2011, 02:17 PM
http://www.washingtonpost.com/opinions/obamas-simplistic-view-of-income-inequality/2011/12/19/gIQAeVmR5O_story.html
Obama’s simplistic view of income inequality By Charles Lane (http://www.washingtonpost.com/charles-lane/2011/02/28/ABeqisM_page.html), Published: December 19 Statistics show rising income inequality in the United States. But, contrary to the impression created by the Occupy protests, and media coverage thereof (http://www.washingtonpost.com/opinions/rightly-targeting-income-inequality/2011/12/07/gIQAGP7ZdO_story.html), statistics also show that Americans worry less about inequality than they used to.
In a Dec. 16 Gallup poll (http://www.gallup.com/poll/151568/Americans-Prioritize-Growing-Economy-Reducing-Wealth-Gap.aspx), 52 percent of Americans called the rich-poor gap “an acceptable part of our economic system.” Only 45 percent said it “needs to be fixed.” This is the precise opposite of what Gallup found in 1998, the last time it asked the question, when 52 percent wanted to “fix” inequality.
Maybe Americans are Okunites — as in Arthur Okun, the late Yale economist and author of the 1975 book, “Equality and Efficiency: The Big Tradeoff.”
(http://www.amazon.com/gp/product/0815764766/ref=as_li_tf_tl?ie=UTF8&tag=slatmaga-20&linkCode=as2&camp=1789&creative=9325&creativeASIN=0815764766%22%3EEquality%20and%20Effi ciency:%20The%20Big%20Tradeoff)
Okun saw free markets as a source of unparalleled human progress — and of big gaps between rich and poor. Indeed, he argued, markets are efficient partly because they distribute economic rewards unevenly.
Government should try to smooth out income stratification, but such efforts risk undermining incentives to work and invest.
Hence the “big trade-off”: channeling income from rich to poor, Okun wrote, was like trying to carry water in a leaky bucket. He wanted to move money from rich to poor without “leaking” so much economic growth that the whole process became self-defeating.
The American public intuitively shares Okun’s concerns. Consider the responses to another question in the Gallup poll. Asked to rate the importance of alternative federal policies, the public saw both economic growth and redistribution as worthy objectives — but put the former well ahead of the latter. Some 82 percent said growth was either “extremely” or “very” important; only 46 percent said “reduc[ing] the income and wealth gap between rich and poor” was “extremely” or “very” important.
In short, the public wants fairness but retains a healthy skepticism about the federal government’s ability to achieve it...
Obama’s simplistic view of income inequality By Charles Lane (http://www.washingtonpost.com/charles-lane/2011/02/28/ABeqisM_page.html), Published: December 19 Statistics show rising income inequality in the United States. But, contrary to the impression created by the Occupy protests, and media coverage thereof (http://www.washingtonpost.com/opinions/rightly-targeting-income-inequality/2011/12/07/gIQAGP7ZdO_story.html), statistics also show that Americans worry less about inequality than they used to.
In a Dec. 16 Gallup poll (http://www.gallup.com/poll/151568/Americans-Prioritize-Growing-Economy-Reducing-Wealth-Gap.aspx), 52 percent of Americans called the rich-poor gap “an acceptable part of our economic system.” Only 45 percent said it “needs to be fixed.” This is the precise opposite of what Gallup found in 1998, the last time it asked the question, when 52 percent wanted to “fix” inequality.
Maybe Americans are Okunites — as in Arthur Okun, the late Yale economist and author of the 1975 book, “Equality and Efficiency: The Big Tradeoff.”
(http://www.amazon.com/gp/product/0815764766/ref=as_li_tf_tl?ie=UTF8&tag=slatmaga-20&linkCode=as2&camp=1789&creative=9325&creativeASIN=0815764766%22%3EEquality%20and%20Effi ciency:%20The%20Big%20Tradeoff)
Okun saw free markets as a source of unparalleled human progress — and of big gaps between rich and poor. Indeed, he argued, markets are efficient partly because they distribute economic rewards unevenly.
Government should try to smooth out income stratification, but such efforts risk undermining incentives to work and invest.
Hence the “big trade-off”: channeling income from rich to poor, Okun wrote, was like trying to carry water in a leaky bucket. He wanted to move money from rich to poor without “leaking” so much economic growth that the whole process became self-defeating.
The American public intuitively shares Okun’s concerns. Consider the responses to another question in the Gallup poll. Asked to rate the importance of alternative federal policies, the public saw both economic growth and redistribution as worthy objectives — but put the former well ahead of the latter. Some 82 percent said growth was either “extremely” or “very” important; only 46 percent said “reduc[ing] the income and wealth gap between rich and poor” was “extremely” or “very” important.
In short, the public wants fairness but retains a healthy skepticism about the federal government’s ability to achieve it...