I looked up Income Inequality and found this statistic. “Just about every socio-economic indicator shows that the distribution of income in the United States is becoming increasingly unequal. In 2010, the top 20% of Americans earned 49.4% of the nation’s income, compared with the 3.4% earned by the roughly 15% of the population living below the poverty line. “
My initial response was “So What!” but that’s just looking at the situation through my eyes, not from the point of view of those who feel that this is a problem.
With all the attention given to protestors and what they perceive to be one of the more significant problems with our country we seem to give them credit for their insight. The biggest problem seems to be Income Inequality. What is income inequality?
Is it two different school teachers in different parts of the country earning different amounts? When a teacher in New York earns $200,000 a year (there are quite a few teachers in NY who earn that much) and a teacher in Alabama who earns under $50,000 a year for teaching the same grade, is that what income inequality is?
Could it be legal immigrant in Florida earning minimum wage to perform an unskilled job and a University professor with several post graduate degrees who teaches in a University Medical Center and earns well over $500,000 between teaching and a medical practice. Is that income inequality?
Could it be a Security Guard in a Mall in Colorado and a successful Rap Star? Rap Stars make a lot of money and security guards do not. I am very sure that there is a big difference in the incomes of these two people,
They have identified that Income Inequality is a problem but they haven’t mentioned how we should deal with it. They also haven’t mentioned why it’s a problem. Rap Stars make music that a lot of people like and they sell their music and that earns them some money. Security guards get paid for working, being present and providing a service. Should they both earn the same amount? If the answer is yes how should we make it happen? Give more to the guard and less to the rap star? How do we create the system where an artist receives less for his or her intellectual or artistic property? Do we pay the security guard more for doing a job that isn’t worth more money? Who will inform the rap stars that they can’t makes millions anymore because of income inequality?
When a small percentage of the population makes a large percentage of the income in the country, that seems to what is perceived as the problem. The part of the problem I don’t understand is how does the success of the high earners, cause the lack of success of the low earners. Our economy is not a zero sum game.
If rap star A makes ten million this year, that does not prevent unemployed single mother B from earning a living wage. (Did any of you accuse rap star “A” of impregnating unemployed single mother B? I did and felt bad for a brief second) There are a number of social issues involved here, personal responsibility and family values could be a big part of the discussion, but rap star A’s income and unemployed single mother B’s low income are not part of the cause or the results of that dynamic.
Assuming this is the problem how to we fix it? Pass some laws preventing movie stars, athletes, rap stars, lottery winners, bankers, and executives from making more than $200,000 per year? Does the same law require that no one get paid less than $100,000 per year? If so how do the employers afford to pay their employees so much more? Does that cause the owners of the companies to lose money? Aren’t they entitled to the minimum wage of $100,000 too?
I seem to be asking a lot of questions, but no one is answering them. I have lots more questions:
Who determines the upper and lower limits to income?
How do we enforce the limits?
When we mandate lower limits on income, what happens to those who make a living supporting the needs and wants of the super wealthy? What happens to the nannies, the cooks, the designer fashions, bankers, car dealers, airlines, hotels, restaurants, investment bankers, etc, etc?
The wealthy support a number of individuals and businesses, without that income a lot of individuals and businesses lose opportunity.
What happens when you limit success and tax revenue suffers?
When you limit the upper side of success but boost the lower end of success will everything balance out? How do we prop up the businesses that can not support the minimum wages required in this redistribution?
How do we fill the void left when we prevent the free market economy from being free?
Is it fair to limit my success by requiring some success for those who don’t earn it?
Is all this a legitimate social problem (income inequality) or just jealousy on the parts of those who fail to succeed?