Thursday, January 3, 2013

Equality and Unicorns

"It's misplaced because it glosses over strong evidence that the ability to rise above your starting place-the American Dream, by most accounts-is better than it was 40 years ago.  "There is no doubt that the spread between top earners and those below them has grown over time. The share of income earned by the top 1 percent in the United States has doubled since the early 1970s. The top 20 percent's share has risen, too, though the increase is much smaller and has leveled off since the 1990s."
Excellent points to consider from this article: If Bill Gates has 200 million or billion or whatever, does that hurt you, and if so, how? You were not forced to buy his product, so your money only went to him if you decided his product was worth what you had to pay. And if someone else's money went to him, how did that hurt you? Answer, it did not unless you were a business competitor.
Furthermore, all of the productivity Microsoft's products enabled materially contributed to you by allowing businesses to develop and sell their products with greater efficiency (better product, available to market more rapidly, at a lower cost). 
How could we "compress" incomes, even if "we" decided we could? "The same trend toward greater inequality is happening in most advanced economies, across different tax and regulatory systems. Despite spending $1 trillion a year on the poor, federal and state governments report increases in poverty and need." 
Government leveling attempts tend to work opposite of the way they were intended. Great example - government workers, who are paid from your taxes, whereas private employees are paid only from money voluntarily exchanged. Washington, DC is now the wealthiest - do you think that comes from the value DC adds to your life? 
"The wealthy" could mean "the old", since the old on average have 22 times the wealth of those under age 35. 12.5% (SS) and 2.9% (Medicare) of the income of "workers" is extracted and given to the "wealthy old." 
And yet - the author cites a study that indicates that 84% of Americans have higher family incomes than their parents did - presumably, even though their parents were more likely to have been or remained married.  
Conclusion: equality is more likely to result from removing the government sucker punches that prevent the less wealthy from upward mobility, than it is from looking for more ways to "slice money off of the top" so that it could be recycled through government programs that are proven not to be cost effective.  

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