If the Poor Earn More Money, We’ll Reduce Income Inequality

monopoly

How can we reduce income inequality? Well, poor people could make more money. Sure, I know you lampoon that answer, but it’s true. It’s just the opposite side of the equation. No, it’s not the answer you’re looking for. I have those coming up later.

If you read this blog or listen to the Unfiltered Unfettered podcast, you know I’m a frequent and long-term media basher. Media is biased. Mainstream media has had a liberal bias for as long as I know. It’s not always obvious, and sometimes I believe it’s even unintentional. But it’s there, and a key question might be, does it matter? I believe it does, and this post relates to that question in addition to income inequality.

A recent Pew research poll about income inequality revealed some of the following answers.

More than a quarter (26%) of self-identified Democrats and those who lean Democratic cited the tax system as a main reason for the gap. Just 14% of self-identified Republicans and those who lean Republican said the same. Among self-identified liberal Democrats, roughly a third (32%) cited taxes. By contrast, Republicans and Republican-leaning independents were more likely (14%) to mention Congress or government policies than Democrats (8%).  (ref)

Taxes were the highest percentage answer. Somehow, the majority answer for solving income inequality has become the tax system. Sorry, but that just doesn’t make sense as a solution. It’s thinking of the situation backwards. Think of it this way, you’re getting your little girl dressed, and she wants to know why you can’t take her to Disney World. “Well, honey,” you might answer “Because rich people don’t pay more taxes.” No, that’s not really the answer, is it? Yet, that’s a political platform that’s become a stalwart of the Democrats. Democrats have advanced, as a political agenda in order to get votes, that taxing the rich will solve income inequality, and the media report it as if it’s a fact. As the media have reported it, people believe it. That’s the circle.

Former Labor Secretary Robert Reich (Clinton administration 93-97) wrote an article for Salon titled “The four biggest right-wing lies about income inequality,” and then went on to talk about some of the biggest left-wing lies about income inequality. His concluding paragraph restates most of the Democratic platform:

The truth is, America’s lurch toward widening inequality can be reversed. But doing so will require bold political steps.

At the least, the rich must pay higher taxes in order to pay for better-quality education for kids from poor and middle-class families. Labor unions must be strengthened, especially in lower-wage occupations, in order to give workers the bargaining power they need to get better pay. And the minimum wage must be raised.

Don’t listen to the right-wing lies about inequality. Know the truth, and act on it. (ref)

All flawed thinking. First, you’d have to prove that more money automatically equals better education. Second, you’d have to prove that the increased tax money will go to the right places. Third, you’d have to prove that the increased tax money would actually go to the education system in a way that would result in a higher educational quality. Then, you have to make an argument that the burden falls strictly to the rich. And, finally, you’d have to prove that all of this would eventually result in reducing income inequality. You can make an argument, but at this point that’s all it is, and it’s a house of cards. I’m certainly not as smart as most that talk about this subject, but I know weak arguments when I hear them. And what I know is this, no one really knows how to reduce it, because no one has yet. Sure, Robert, the government’s going to fix it, right?

See, it’s not just about “the rich” paying more money. What about involved parents? What about parents working with their children? Is education simply up to the government? If you answered yes, just stop reading right now. Well, what’s the truth? As with most things, the truth is probably somewhere in the middle, and a combination of many factors. One of those factors is something you may not have read about in the mainstream media.

A recent article in the Wall Street Journal titled “Ignoring an Inequality Culprit: Single-Parent Families: Intellectuals fretting about income disparity are oddly silent regarding the decline of the two-parent family.”

The article addresses what the authors call “The strongest statistical correlate of inequality in the United States: the rise of single-parent families during the past half century.” They make the argument with the following figures:

The two-parent familiar had declined rapidly in recent decades. In 1960, more the 76% of African-Americans and nearly 90% of whites were born to married couples. Today the percentage is 30% for blacks and 70% for whites. The out-wedlock birthrate for Hispanics surpassed 50% in 2006. The trend, coupled with high divorce rates, means that roughly 25% of American children now live in single-parent homes, twice in the percentage in Europe (12%). Roughly a third of American children live apart from their fathers.

Further;

Abuse, behavioral problems and psychological issues of all kinds, such as developmental behavior problems or concentration issues, are less common for children of married couples that for cohabitating or single parents, according to a 2003 Centers for Disease Control study of children’s health.

Finally;

More the 20% of children in single-parent families live in poverty long-term, compared with 2% of those raised in two-parent families, according to education policy analyst Mitch Pearlstein’s 2011 book “for Family Collapse to America’s Decline.” The poverty rate would be 25% lower if today’s family structure resembled that of 1970, according to the 2009 report “Creating an Opportunity Society” from Brookings Institute analysts Ron Haskins and Isabel Sawhill. A 2006 article in the journal Demographic by Penn State sociologist Molly Martin estimates that 41%of the inequality created between 1976-2000 was the result of changed family structure.

 

Pretty heavy stuff, yea? Did you read that? “The strongest statistical correlate of inequality in the United States.” But, when’s the last time you heard anyone talk about this in politics or popular media? Outside of an occasional rant by Bill Cosby, you probably haven’t. What you hear is “tax the rich, bring back unions” and other such political nonsense.

Because talking about single-parent families is not going to get people to vote for you. This is one of the many places where politics and truth part company. It’s easy to demonize people with money, stir class warfare, say how they need to pay more, it will make things better, how you’ll make them, and get votes.

Because the media’s job is to get viewers. A politician’s job is to get elected. The truth gets lost there.

 

 

 

http://online.wsj.com/news/articles/SB10001424052702303603904579493612156024266

http://www.pewresearch.org/fact-tank/2014/04/28/americans-agree-inequality-has-grown-but-dont-agree-on-why/

http://www.reuters.com/subjects/income-inequality

http://www.salon.com/2014/05/06/robert_reich_the_4_biggest_right_wing_lies_about_income_inequality_partner/

3 comments on “If the Poor Earn More Money, We’ll Reduce Income Inequality

  1. […] If the Poor Earn More Money, We’ll Reduce Income Inequality. […]

  2. ~C says:

    “Because the media’s job is to get viewers. A politician’s job is to get elected. The truth gets lost there.”

    An opinion, for sure…but one I agree with wholeheartedly.

    What can we do about it?

    Great article buddy.

  3. JennaR says:

    I do not disagree with your premise at all, one cannot argue with what only makes logical sense and with what is also statistically sound and proven.

    Central to the discussion for both sides also needs to be personal culpability and the dissolution of such a sense of entitlement. You touched on it quite well with your schools example and it’s something I hear often from other parents, complaints about what the teachers, staff, and administrators aren’t doing for Susie and Bobby, why Jessica, Crystal or Jack has a personal helper insider, outsider, during and after class, even at home, but we can’t get one, etc. Well, inside all of this complaining,what are YOU doing for them? Homework hour is dreadful, you don’t feel they should have any, on and on and on…

    My oldest just finished second grade. When she would bring home a test, we would review her answers. Sometimes it was clearly a case of her not understanding how to critically think through to arrive at the answer, versus just not retaining information. What to do? Give her the skills to independently think critically. Revolutionary, I know, especially for a 7- year old. What happened? In subsequent tests with similar questions, across all subjects, she was able to correctly answer those questions. Amazing, isn’t it? Instead of expecting her teacher to, one-on-one, explain how and why an answer was wrong to each student, taking the time to do so with your own child. Mind-boggling that information doesn’t have to specifically be covered in a class for a child to be expected to get it right (the rallying complaint of other parents)
    I frequently say in my house, “Let’s not be problem whiners, let’s be problem solvers!”

    Here is a link I came across the other day on American moms versus Hong Kong moms that illustrates this principle:

    http://www.greatschools.org/parenting-dilemmas/7595-cross-cultural-parenting-style-study-po-bronson.gs

    When it comes to taxes and entitlements, the principles really aren’t much different, they extend right into people’s thinking and sense of entitlement about what they’re owed in terms of government services, taxes, etc.

    If I earn more, yes, I should pay more but not in a punitive manner. Nor should being poor be punitive. The word ‘entitlement’ needs to be stricken from our collective vocabularies. It is not an entitlement unless you have worked for it. Social security, job loss benefits you have worked for to pay into the system, medicare, these are entitlements. Other things granted by the government are social largesse and as such, should stop being funded by the government and should fall to the graciousness of the people. But I’ll stop there because that’s a entering into a different financial argument entirely (see the Libertarian party’s ideas on social welfare reform).
    Bottom line: cut the fat, seek out greater personal responsibiliy in all aspects of life

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