Income inequality: The snake that threatens to choke the economy


Quoted completely from the Economic Policy Institute:

In recent decades, the bulk of income growth in America has gone to the top 10% of families, but that was not always the case. Throughout most of the 20th Century, the bottom 90% claimed a much larger share of income growth than they have in recent years. The Chart, from EPI’s new interactive State of Working America Web site, compares the distribution of income growth over two periods. Between 1948 and 1979, a period of strong overall economic growth and productivity in the United States, the richest 10% of families accounted for 33% of average income growth, while the bottom 90% accounted for 67%. The overall distribution of income was stable for these three decades. In an extreme contrast, during the most recent economic expansion between 2000 and 2007, the period that led up to the Great Recession, the richest 10% accounted for a full 100% of average income growth.

Income inequality, from EPI

In other words, while average annual incomes over the seven-year period between 2000 and 2007 grew by $1,460, that growth was extremely lopsided. Average incomes for the bottom 90% of households actually declined.  The interactive feature When income grows, who gains?, on the new State of Working America Web site, lets users look at income growth and distribution patterns for any time frame between 1917 and 2008.

This new feature lets users choose any two years between 1917 and 2008 to see how much the top 10%, versus the bottom 90%, contributed to growth in average incomes. Because income growth can change a lot during periods of recession, researchers tracking trends in inequality often chart movements between the peaks of different business cycles in order to avoid comparing a high point in one business cycle to a low point in another. The interactive feature on income distribution also shows how an increasing amount of income growth has been flowing not just to the top 10%, but to the richest 1% of families.

More at the EPI website.

Econ chart - who gains, from EPI

Income inequality, Economics Policy Institute – click on image for a larger version

If you find it difficult to read the chart, you can click through to a larger version at EPI, or click on the thumbnail image for a larger one.

Wasn’t income inequality one of the key causes of the Great Depression?

Tip of the old scrub brush to reader Nic Kelsier, and to Luiz Carlos Abreu, who appends this note:

I wish the bottom 90% would let go of the myth that we can all be in the 10% richest. In fact, being rich does not mean having a happy not even non-stressful life, not if polls on the subject tell anything.

Never mind Christianity, Judaism, Islam — the real religion of most Americans seems to be Capitalism; there are even some fundamentalist capitalists. Its main beliefs seem to be:

  • The world has unlimited resources so long as we have faith in Money to whom nothing is impossible.
  • Only Money is God, those who have Money are His Prophets.
  • The Holy Sainthood and Divine Right of the Rich.
  • Money is happiness, and to be one with Money is the Supreme Happiness.
  • We can do all things through Money that enriches us.
  • An amount of Money is a measure of Holiness or Godliness, therefore separating Money is a sin and accumulating Money is a holy act.

I wish this was just a bunch of BS.

Also see:

 

149 Responses to Income inequality: The snake that threatens to choke the economy

  1. Maybe, just maybe, the United States has an issue with effort inequality. Interesting how you just kinda excluded that.

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  2. Ed Darrell says:

    Maybe, just maybe, the United States has an issue with effort inequality. Interesting how you just kinda excluded that.

    Americans and libertarians have, to this time, supported the idea that people who work hard should reap the benefits of their hard work.

    Income inequality figures shown here demonstrate the reality: Most Americans who work hard, who improve their efficiency and increase the hours they work, get screwed out of the income from their increased efficiency and longer hours.

    If it were a lack of effort, there wouldn’t be increasing GDP. The issue is that those who make the increasing effort, those who work hard, don’t get the benefits. Those benefits flow instead to oligopolists and rich campaign donors.

    Unjust, in other words. Those who make the effort, get screwed. If you were serious, Morgan, you’d be on their side.

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  3. Maybe, just maybe, the United States has an issue with effort inequality. Interesting how you just kinda excluded that.

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  4. How many more definitions do you need?

    Obviously, I’m going to need some kind of a line to be drawn. So is everybody else. It will be necessary for implementation. If I make twice as much as the next fellow, it it alright with you that I pay twice as much tax, such that my take-home pay is double from what that other guy can take home? Or would you be alright with me paying sixty percent more. Or would you rather that I pay a much higher rate, so that at the end of it all, he and I take home the same amount nickel-for-nickel?

    How about if I make eighty thousand times as much as he does, and we use a nice progressive income tax scheme, and at the end of it I take home…fifty thousand times as much as he takes home. Would that be “fair”?

    Point is, when progressives use the word “fair” it’s already acknowledged among conservatives, and quite a few observant centrists, that the proggies don’t know what “fair” is, they only know what is UNFAIR. In simpler terms: They don’t have a plan, they just like to do a lot of complaining, like most lefty revolutionaries…all the way back to the storming of the Bastile. You haven’t given me any reason to be swayed from that understanding, here. After all, if I held some kind of revolution against unfair things, bloodless or otherwise, and insisted on “fairness” — I’d define what that is. Much better than you have, here. First step in any project of any complexity, is to define the goal in clear, objective terms. That just seems like common sense, to me.

    In a just system, we’d take that money back.

    Well…you should probably go start your own “just” country. We just got done celebrating the signing of the Declaration of Independence here, our nation’s founding document, which makes it clear we are endowed by our Creator with certain inalienable right, that among these are life…liberty…AND THE PURSUIT OF HAPPINESS. I hold this truth to be self-evident, that this means — working, realizing income or profit from that work, and saving it. I’m sure you understand, being a history teacher, that when those words were written our new nation did not yet exist, and after it existed it was several generations before there was an income tax.

    Therefore, you little ruse to “take that money back” is contrary to the original design ideals of our country. We’re supposed to be accountable to God, not to a King, or a bunch of meddling conspiratorial royal bureaucrats in his service, calculating how much money we “need” to survive. Let the Brits put up with that if they’re so inclined.

    I understand the appeal of insisting on “fairness” while leaving it defined only in this squishy “SpongeBob” way, uselessly. Seems like a great idea when you’re the one who profits from a new imposition of “fairness.” But it’s different when this imposition of fairness costs you something…and ultimately, the imposition of your kind of fairness would hit your “working” people just like it would hit the investors. It’s bait-and-switch, it’s been tried many times before, in many states as well as at the federal level. And people are wise to it now. They may re-elect Obama because they’re angry at someone…but…check the one-way moving-truck rates. People vote with their feet. That means they know this stuff doesn’t work, even if we’re still waiting on you and Robert Reich to figure it out.

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  5. Ed Darrell says:

    Then why are you opposed to letting working people get the money they’ve earned, and keep it?

    You’re assuming the rich guy worked for all the money he got. That’s not what’s happened. Because of income inequality, the rich guys have accumulated a lot of money that the working people made.

    In a just system, we’d take that money back. We’d go into their bank accounts and investments, and take it back.

    We’re asking for justice from here on out — letting the crooks keep their ill-gotten gains. But that only works if we stop the stealing from the poor and working class.

    It’s that simple: Should we, through the tax code, allow the rich to steal from the poor?

    If you think people should keep the money theove earned, why aren’t you for letting them get it in the first place?

    If you think we should use the government to redistribute incomes, make a case for it. But if you’re not going to make a case for it, at least stop claiming it’s unfair to end it.

    If you don’t let the people who earn the money, get it, bank it, and pay it out for their consumption, there is no flow of money; at best there is just a trickle where a full stream should be.

    We need to smash the rules that say “working people can’t get rich.” I cannot figure out why you defend them.

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  6. Ed Darrell says:

    Fairness 1: No one pays a lot more, or a lot less, in taxes, than their share of the take from the economy.

    Fairness 2: We don’t put taxes on all people evenly, because that makes it a bigger burden for the poor and working classes.

    Fairness 3: In aggregations of income groups, we don’t tax the lower paid groups proportionately more than the higher paid groups — so that, in an economy producing 100X in income, those who make 20X don’t pay 30% of the taxes; those who make 50X don’t pay 30% of the taxes, either.

    Fairness 4: We don’t take money away from any class to make another class richer. We don’t take money from the rich just to redistribute it to the poor; neither should we keep taking money from the poor to redistribute it to the rich.

    How many more definitions do you need?

    Fairness 5: We don’t make it so that a really bright kid from a poor family has no chance to run as far as she can, educationally. We don’t hobble the brightest people’s educations, just because they are poor. Neither do we give stupid kids from rich families advantages over the poor, educationally. We don’t give the rich a pass on being smart, to get the Smart merit badge.

    Fairness 6: Don’t you have a dictionary?

    Fairness 7: Morgan doesn’t get to bait and switch ALL the time, sometimes he has to deal with the real data.

    Fairness 8: Someone who works with their body doesn’t make less money than someone who works with their mind, for the same effort.

    Fairness 9: Someone who works with their body, and works smarter, gets a share of the increase in profits due to their working smarter.

    Fairness 10: There is no wealth without labor; we don’t give working people the short shrift on benefits, including especially retirement income.

    Fairness 11: As a nation we’re rich enough that no one should ever have to live in the poor house (especially since the poor houses were sold off, and the profits given to the rich).

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  7. Okay, well I’m not clear on how allowing people to keep the money they’ve earned, kills jobs. If Reich’s point is that a thing is automatically the opposite of that thing, then his point fails because it can’t fit into this universe.

    If we want to tinker with the rules that say some things are allowed and others are not, or that some things should be made easy and other things should be made hard, and our objective is to strengthen something called “the economy”…our efforts should be going toward allowing people to get rich. Fabulously rich, if their efforts can culminate in such a happy situation. Right?

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  8. Ed Darrell says:

    You know Ed, it occurs to me that if thousands of people lose their jobs because of the restrictions and regulations and investor-profit impediments you want to put into place…then, as long as definitions actually do mean something, they would cease to be “working people” and therefore off the radar from the class of people you’re supposedly wanting to help.

    Absolutely.

    But of course, that would be true for any governmental action, or inaction. If that action or inaction causes people to lose their jobs, especially more than the jobs created, then working people become non-working people.

    Our tax policies have done that. That’s Reich’s point. Our current GOP-led Congress, with it’s job-crushing, economy-poisoning “sequester” does that, kills jobs and puts people out of work. Our failure to repair roads and bridges puts people out of work. Our failure to build appropriate schools puts people out of work.

    If you had noted more carefully, you’d have noted that I don’t advocate any job crushing policies, especially regulations. You assume what is not in evidence, and you have assumed it so long you think it’s true, evidence be damned.

    It further occurs to me that if the labor participation continues its Obama-era decline, a great many of us will enjoy the benefits of this income equality: Zero.

    Why do you call it “Obama-era.” It started with Ronald Reagan. Obama hasn’t been able stop it (I don’t think Clinton appreciated the need to stop it, and he didn’t, either.)

    You’re starting to get smarter, even without the sheep pellets.

    Reich calls for an end to those labor-unfriendly, union-killing, job-killing policies.

    You though Reich a Republican?

    That isn’t really the goal, is it? Or is it?

    For Paul Ryan, Rand Paul, Mitch McConnell, John Boehner, Eric Cantor, Mike Lee, and others of their fellow-traveling corps, I fear it is the goal.

    Others go along with them because they don’t dwell in reality.

    When the working people can’t buy, the economy stops. Clinton’s cattle futures fail. Investments in Fluor fail, because there aren’t big construction projects (especially if we stop their war zone work).

    Not my goal. Are you working towards that as a knowing Bolshevik, or as a Tea Party dupe?

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  9. You know Ed, it occurs to me that if thousands of people lose their jobs because of the restrictions and regulations and investor-profit impediments you want to put into place…then, as long as definitions actually do mean something, they would cease to be “working people” and therefore off the radar from the class of people you’re supposedly wanting to help. It further occurs to me that if the labor participation continues its Obama-era decline, a great many of us will enjoy the benefits of this income equality: Zero.

    That isn’t really the goal, is it? Or is it?

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  10. Working people make the enterprise go. The price of the product goes up. The work done by the people is better, and more efficient, and the profits increase, too.

    Fairness, by any definition, suggests those workers should benefit from the increased price and increased profits.

    Problem one: Still no definition? Just “Fairness, by any definition, suggests…” Why stay so squishy on the meaning of the word upon which your entire argument depends?

    Problem two: Are you saying they don’t benefit? Does the quality of the product or service not improve with the technology? Say a man exists in the here-and-now with entirely disposable income of, oh, four hours’ worth of unskilled labor per week. Would you seriously suggest his quality of life is equivalent to that of a man living two centuries ago with the same disposable-cash situation?

    Problem three: There are other people who “make the enterprise go.” Warren Buffett makes his enterprise go. Investors make the enterprise go, since without them there would be no enterprise.

    Fourth problem is: Nowhere is it written that people have to labor womb-to-tomb as these “working people.” People can study and go into management. People do. They can build things. They can do what Joe The Plumber was trying to talk about, and start their own businesses…those avenues are available to them. If they’re limited, they’re limited by their own vision. That is not to say it’s easy; if it was easy then everyone would do it. Is your campaign to make it easy when it’s not? Then why do you want to raise taxes on the people who are thinking about doing this?

    I think most people thinking with solid and reasoned common sense, will understand that making large amounts of money can be defended the same way as abortion, reading dirty magazines, atheism, converting to Islam, or for that matter joining the Boy Scouts or owning guns: If you don’t like it, don’t do it. But don’t take freedoms away from people who are doing things you choose not to do.

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  11. Ed Darrell says:

    Working people make the enterprise go. The price of the product goes up. The work done by the people is better, and more efficient, and the profits increase, too.

    Fairness, by any definition, suggests those workers should benefit from the increased price and increased profits.

    If they don’t, and Reich shows they don’t benefit, and are not benefiting, then it’s unfair.

    What do you have against working people, Morgan? Why don’t you think they should earn more when their work gets better, more efficient, and more profitable?

    How can you justify an American CEO making hundreds of times what the front-line workers make? In terms of effort, in terms of brain power delivered, in terms of skin in the game, in terms of making the economy work for years rather than minutes,it’s unjustifiable.

    What’s your rationalization for speeding collapse?

    How can you possibly justify a statement that making money by way of exchanging skilled or unskilled labor by the hour, for money, on average, should be as lucrative as risking capital?

    How can you so badly misinterpret a call for fair wages as a call for equal pay for unequal work?

    (There’s a serious issue, that you wish money to be better off than the people who make it, at least from what you say — but that’s a more subtle blindness on your part. Maybe if you quit worshipping money for a moment and think of people, you might see the light. But I doubt it.)

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  12. The issue is not about taking wealth away from investors that they earn with their acumen. The issue is fairness for working people.

    Why do you define things, using words that are entirely devoid of meaning? “Fairness”? What is that? Could it not be said we have that already? if not, what makes it unfair? The inequality? How can you possibly justify a statement that making money by way of exchanging skilled or unskilled labor by the hour, for money, on average, should be as lucrative as risking capital?

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  13. Ed Darrell says:

    Wouldn’t those be investors, like Warren Buffett and George Soros? Or Hillary Clinton with her cattle futures?

    Yes, they are probably in the 1%.

    Do you ever listen to Warren Buffet? He’s on Reich’s side. So is Clinton. The issue is not about taking wealth away from investors that they earn with their acumen. The issue is fairness for working people.

    If those investors know what they’re doing, as they invest in volatile but lucrative commodities, should we not expect them to make more money than someone who trades hours and years for some contractually-established amount?

    You really don’t understand what the issue is, do you. Fascinating.

    Yes, of course we should expect them to make more.

    It’s not about taking money from the rich to give to the poor. The issue is about making a good, consumer-based economy with wealthy consumers to drive it.

    Investors will do better in that environment. More investors will do better.

    You don’t understand how economies work at all, I’m now convinced.

    That’s a yes or no. If it’s a yes, then there’s really no problem and his comment “this is not sustainable” requires some foundational support that he isn’t providing. Why is it not sustainable?

    It’s not sustainable because investing in cattle futures turns into a bubble that bursts — or slowly loses all its inflation — if there are not huge markets of consumers who will buy beef and leather.

    Investors can find other areas to invest in, but those areas will become fewer, the profits smaller, and in the end, the winnings will go to fewer and fewer people who make more and more.

    Until, at some point, there are enough former 1%ers in the newly-poor group to organize them and set up guillotines. Oh, there could be a lot of reforms to prevent the guillotines before then, but the odds of guillotines become greater the more people like you fail to try to understand what’s going on, and fail to act to fix it.

    The social contract has been violated. There’s a god-enforced liquidated damages clause, and it can only be avoided if mitigation occurs.

    You see no need for mitigation. Eh, you will eventually be taken care of.

    Remember Henry Ford. He lost one company because he couldn’t make the quality cars he wanted, and sell them fast enough.

    With his second company, he invented the automobile assembly line, and he could make cars good enough, and fast enough — but he wanted better cars, faster. So he doubled the daily wages of his assembly-line workers.

    His workers got the two-week bump in morale that provides, and that was good for two weeks.

    But after that: Ford had his pick of great workers from all the other auto plants, and from other industries, and other areas. Everybody wanted to work for Ford. He ended up with among the best-qualified, best-experienced, and best-working workforces anywhere.

    Better workers kept making suggestions to improve the operations. Incrementally, Ford’s plants became even more efficient, more productive.

    And one day the local fire marshall came to call: He told Ford there were too many cars parked around the plant, cars from Ford’s workers, and they clogged the streets and made it difficult to get fire fighters to fires. The city asked Ford to build a parking lot.

    Ford groused for a few minutes. Then he realized why his sales, especially in Detroit, had been so good. Not only had he created a company that could meet market demands, but by paying his workers more, he had created an entirely new market. His own, numerous workers, could afford to purchase his products, and they did.

    Reich lays out how that effect played out through the end of the 20th century. Especially after World War II, workers got relatively rich. In return for 30 years of hard work, workers got rather handsome wages, health benefits, and a good pension.

    In return, those workers went on buying binges of sorts. They bought millions of new houses, creating millions of other jobs to develop, build, outfit and maintain those homes. The workers bought cars, and that built even more auto companies — not to mention the road construction groups to build the roads, and the oil companies to supply the fuels and lubricants.

    Those roads and industries created new industries by themselves. Hotels, motels, “casual dining” restaurants and chains . . .

    Ford’s workers bought food, and clothes, and education for their children.

    Since the late 1970s, we’ve choked that system, almost to death. Workers, who form the foundation of our economy, have been starved of wage increases, and benefits. Increasingly, we created tax systems that took the benefits of higher productivity, especially in profits, and sent them to the top 1%, and not to the workers who made the improvements.

    That’s unfair on its face (you don’t think so — you enjoy sitting on your can and not getting your hands dirty, and you probably chuckle about the dirty-hands people whose wages you’re stealing because they don’t know it — or worse, you’re a dirty-hands guy who has been duped big time).

    But ultimately it’s killing the golden-egg laying goose. Ford’s success depended on selling millions of autos, not a few. The housing industry depended on building millions of smaller homes for families, not a few mansions for the wealthy.

    All of those industries are in an almost-Ponzi-scheme system; where growth is not required, at least mass consumption is.

    Those people at the top? Hillary Clinton has a house, and she’s not going to buy a million more. She has a couple of cars, not going to buy more than a couple more in the next five years, maybe. Even if she eats out every night of the year, she’s only buying one or two meals, not the ten thousand meals necessary to support a Chili’s, McDonalds and the local diner.

    An economy is a system of exchanges of raw resources, labor, ideas, products and money. It depends on everybody in the process getting a fair part of the entire wealth pie, to make it work over time.

    As Reich explains, the people who make the cars, the houses, the roads, and serve you meals, do your contracts, keep your eyes healthy — are losing out.

    You’re familiar with the old essay, “I, Pencil?” Think of how it could possibly work if the workers who assemble the pencils got sick and died, and the workers who mined the graphite got wiped out by a tsunami with no one offering assistance to rebuild them, and the ships carrying those products without people to sail them.

    And what happens if the people who buy the pencils, stop using them, and stop buying them? Then, no matter what everybody else up the chain does, the entire thing collapses.

    I don’t know how a guy can be so verbose and be so disconnected from reality, Morgan. But you sure are, it appears to me, from your comments.

    It’s “supply and demand.” Supply is worthless if there is no demand for it. That’s the ultimate folly of “supply side” economics. It cannot function at all without healthy demand. Reagan started hammering away at killing demand, and no one acted to stop it since.

    Now we all suffer, and the suffering will get worse if we don’t fix it. The very notion of “free enterprise” requires fair markets. Not fair, not free for long. All effective legal codes, from Hammurabi on, understood that. In the markets of Hammurabi’s reign, a butcher who didn’t give good weight lost his thumbs (no thumbs on the scale after that!). Government must keep the playing fields level, the markets fair, the competition fierce — or we fail.

    Income inequalities don’t mean a thing, if you don’t give a bowel movement for freedom.

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  14. Not the parts that were left unclear before.

    The Robert-Reich facsimile cartoon character uses vague and nebulous terms like “corporate interests” and “the rich” to describe those who have been “receiving” this larger piece of “the economic pie” in the last few years. Wouldn’t those be investors, like Warren Buffett and George Soros? Or Hillary Clinton with her cattle futures? If those investors know what they’re doing, as they invest in volatile but lucrative commodities, should we not expect them to make more money than someone who trades hours and years for some contractually-established amount? That’s a yes or no. If it’s a yes, then there’s really no problem and his comment “this is not sustainable” requires some foundational support that he isn’t providing. Why is it not sustainable?

    Also, if this is just investors doing what investors should be expected to be doing, which is to make a great deal more money than they could have been making before they became investors, in their “wave slave” jobs…would this “inequality” not be a statistical code-word for “opportunity”? Your progressive efforts would then end up being toward polishing down these offensive levels of “opportunity.” Opportunity to get fabulously wealthy, and after taxes, keep as much of it as possible.

    What exactly is an “economy,” if it isn’t an effort to do exactly that?

    Let me take this opportunity to Darrell-ize the original Darrell: Why do you hate the economy so much, Ed?

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  15. Ed Darrell says:

    Does this make it any more clear to you, Morgan?

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  16. America is not broke. There is no need for high unemployment, other than to try to create a poor class to staff the prisons and workhouses.

    I agree with that completely. Rush Limbaugh says democrats have a need to create a permanent underclass. He’s right.

    You mention high unemployment. I heard at the beginning of 2009 that hope won and fear lost, but since then…it doesn’t look like hope won. Now how do you explain this; is the income inequality much greater during Obama’s presidency than it was during the administration of His predecessor?

    Just run the numbers, Morgan. Afraid they won’t support your claim? You’re getting a good dose of common sense.

    I agree, if by “common sense” you mean to say “democrat party propaganda.” Alas, your propaganda is not subject to numbers, because to come up with some numbers in the first place we need to know what we’re measuring. When you say “income inequality” are you talking about gross? Net? Or wealth? How come it’s so hard to get liberals to specify which one they mean, when they’re generally so passionate about the issue?

    The “claim” was contrasting the poor with those who made $60k a year. And it wasn’t mine, as I pointed out I merely questioned why you were commenting on something you didn’t understand, then I did the Google search you couldn’t be bothered to do. Now are you seriously suggesting our tax code isn’t tough enough on those making about $60k a year? If not, then what are you suggesting?

    It’s a nice rhetorical move, Ed…pretend it’s the other side that refuses to deal with the evidence, numbers and details. It just doesn’t work in your case, because you leave too many vital things undefined. You don’t get to play that card when you ask things like “Wasn’t income inequality one of the key causes of the Great Depression?” and the only evidence you can bring to support it is — here are the names of a bunch of economists who think so.

    The supply-siders can provide that too. Along with that good dose of REAL common sense: When it’s easier to make and keep a profit, people are motivated. When they’re motivated, they take risks; when they take risks, now & then they succeed…over the longer term, they’re inclined to succeed more often than they fail, as they learn. Then they make jobs for others. And, unlike the “income equality is the key to improving the economy” theory, this one actually has historical results to offer.

    Now, each economic snapshot is going to be a complex plate-of-hurl with lots of confounding variables in it; that’s reality. So I can understand why there might be reasonable lingering disagreement about this. One side has an occasional flattering anecdote, some propaganda about “everyone has to have money before anything gets sold” and a list of agreeable economic authorities — the other side has the agreeable economists, a solid & sturdy track record of success INCLUDING the abrupt end of the Carter depression in the early 1980’s, AND a monopoly on this common sense of which you speak. Government can interfere, spread the wealth around, make it harder for anyone to get fabulously rich; if it’s harder to get rich, we should expect the economy to deteriorate, by definition of the word “economy” (2-a). Such an economy would be, after all, getting choked by a snake of sorts. If it’s easier to get rich, then we should expect the economy to do better…that is also by definition of the word.

    Here, as in many other places, it seems to me the disagreement about what to do, comes from a disagreement about what the word “economy” means. You maintain in your title it is something being choked by a snake, when people are allowed to keep more of the money they have earned. Maybe you need to explain that, before we can examine any numbers. As I’ve noted, you haven’t specified what exactly is supposed to be measured in order to produce the numbers, so we’re not ready to talk smack to each other about who the numbers are going to favor just yet.

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  17. Ed Darrell says:

    Rereading, the bile rises:

    and the point stands that when the poor are poor because of lack of income, but we’ve compensated by giving them benefits, maybe it isn’t quite so legit to call them “poor” anymore.

    We have not “compensated” good Americans who need jobs with benefits; the safety net died with the GOP Sequester, remember? Damn, Morgan: We’re furloughing the people who support our soldiers in war.

    No, spotty housing benefits don’t make up lost income. No, unemployment insurance — which tends to run about 10% of past salary — doesn’t make up lost income. No, you can’t eat even a Spartan diet on SNAP. No, every point of your claim is wrong — especially in your cavalier assertions that benefits are easy to come by.

    Critical thinking? No, I don’t talk about it much here. Maybe I should — but surely you’ve provided us with no good example of it.

    America is not broke. There is no need for high unemployment, other than to try to create a poor class to staff the prisons and workhouses.

    That was a stupid and immoral policy in Scrooge’s day, and it still is.

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  18. Ed Darrell says:

    Just run the numbers, Morgan.

    Afraid they won’t support your claim? You’re getting a good dose of common sense.

    “Critical thinking” doesn’t mean constant carping; you need to learn to analyze your claims, for accuracy, for truth, for significance and relevance.

    In this case, I dare you to make an accurate argument with real numbers.

    We’ll understand if you refuse to put pen to paper, so to speak. In fact, we already do.

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  19. Embarrass me, Morgan.

    What, again? Is this like when I beat my kid in a game of paper-scissors-rock and he goes, “best two out of three”? Why do I have to show you you don’t know what you’re talking about, a second time?

    Look, let’s just grant that this “I found different quotes” exercise is a thorough debunking. Just like that guy got tired of listening to you complain, and granted that working in a law firm counts 50% toward “working in the private sector.”

    You’ve talked a great deal about critical thinking here. Even if you’re granted all these concessions, all you’ve managed to do is change some plot points on a graph, and the point stands that when the poor are poor because of lack of income, but we’ve compensated by giving them benefits, maybe it isn’t quite so legit to call them “poor” anymore. Surely your so-called “critical thinking” fills you in on that point, right?

    Or have we been running down all these bunny trails so that you can avoid acknowledging it…just like we went down those other bunny trails to avoid acknowledging how woefully inexperienced in real, wealth-creating, people-helping business President Obama’s cabinet is. I’m getting the impression that’s the case.

    Like

  20. Ed Darrell says:

    What I think, is that your bar of performance for “debunking” things is so low that it renders the act mostly meaningless.

    Hey, you made the fantastic claim, and you even took it seriously.

    “Cleveland Currant.” Would it have been more of a clue for you had he called it “the Cleveland Onion?”

    My bar for discussion isn’t Joe’s, as yours appears to be.

    Embarrass me, Morgan. Run the numbers for your neighborhood. See how much of a patsy you’d be to work in your town, instead of goofing off 36 weeks a year and sweeping up at the local Mickey D’s for 12 weeks.

    Who knows? Maybe you’ll convince yourself to knock it off and spend full time blogging against the revolution? Just think of all the neo-cons you can save.

    Like

  21. Ed Darrell says:

    Maybe more to the point, Morgan, why don’t you run the figures for your town — you’re near Sacramento? State income tax and all, pull out your TurboTax or tax charts, plug in the numbers, call the agencies and see what you can get, and run actual numbers. A family of four, you’re going to need a two-bedroom apartment there — how much does that run?

    Now, when you run the numbers, remember that the Earned Income Tax Credit has limitations, and that you can’t get the child care credit unless it’s to enable you to get either a full-time job, or allow you to attend school full-time (another goof Emerich made, but we’re cutting him a lot of slack since we know he’s number- and fact-challenged).

    The Department of Labor has numbers they use for the CPI calculations, and if you don’t want to shop a week at your local Safeway or Kroger or Whatever, you can use those numbers.

    Also, Emerich completely left off the FICA taxes — 7%, at the lowest level of $3,625 annual income, FICA runs $271.88, chewing up all but about $6.12 of that “tax benefit” (wherever Emerich got that). Be sure to include that.

    You’ve got great public transit there all over California, right? You guys always go on about how expensive to the taxpayers it is and wasteful — but please include the money required to get around. California’s a car state, and you can get a junker for $1,000 — and of course, it costs almost nothing to get it licensed, inspected and insured. Emerich left all of that off (and Mississippi has very little public transportation).

    Just run the numbers. Tell us how cheaply it can be done and how much that family on food stamps is livin’ on Easy Street.

    We’re from Missouri. Show us.

    And you, Dear Reader, feel free to do the calculations for your town and state. According to Morgan, you’ll probably be convinced to chuck your job and go on the highly fictional “welfare,” especially if you’re a teacher.

    Show us your numbers here.

    Like

  22. What I think, is that your bar of performance for “debunking” things is so low that it renders the act mostly meaningless.

    And I also think, if liberals cared as much about making life better for people as they cared about acting smug & perceptibly superior to conservatives, Detroit would look much better.

    Like

  23. Ed Darrell says:

    So the numbers end up different, one optimistic by design, the other pessimistic by design…the difference “proves” conservatives “can’t do math.” Love your logic.

    So, the insurance costs less for the person getting the $70,000/year, and the quarter-time loafer doesn’t get as much, but you think it justifies the numbers?

    Can’t add, can’t subtract. Can dance a little?

    Like

  24. And with Emerich\u2019s name, I found the rebuttal in a few seconds. You could have, too. Why did you pose the false claims in the first place, computer whiz that you are?

    Uh no, the claim was posed here. You called it “balderdash” here, without knowing what you were talking about. And then I did the work you didn’t want to do, of finding the source…so I have to give you credit for your question, under the circumstances that takes some hubris.

    And then you found Mr. Singal’s piece on one of your tried-and-true lefty sources…okay, good for that, but you missed out that there’s a rebuttal to Mr. Singal. Which, of course, you could have found yourself.

    If you’d been looking.

    TNR claims the chart \”epitomizes conservative intellectual dishonesty.” But this is a classic case of not being able to see the forest for the trees.

    The “forest,” in this case, is this: A benefit is a benefit. It translates into disposable income, because with the benefit provided, the available cash can be spent on other things.

    So in sum, you called something “balderdash” that ended up being supported by hard numbers…with which you & yours disagree, because you don’t like them, and your Mr. Singal managed to come up with some different estimates. Pretty low bar for “debunking,” but good enough to act smug, which is more than adequate on Planet Liberal. Still and all, it does seem to cross a line when you’re accusing others of not Googling properly, after they’ve been doing the work you should’ve been doing before you spoke.

    Now, to this

    Morgan…why do you think more Americans don’t drop out of the economy and get a 1-week/month minimum wage job, and goof off?

    A work ethic is the one human characteristic on which it is most dangerous to generalize…that, and the quality of resilience, arguably beyond reason, the “blind man playing chicken” quality. So the answer to your question is, I don’t know and I don’t care. Maybe their vision is staying alive long enough for the Obama insanity to come to an end, at which time they can hope to finally achieve a better standard of living for their hard work after sanity is restored. Or, maybe they just don’t know any other way to do it.

    But some are perhaps doing exactly that kind of goofing off. It’s the old incentive thing: Provide an incentive for doing something, more people will do it; provide an incentive against, fewer people will. Our friends on the left consistently have a problem with grasping this. Again: Feeling smug is plenty good enough in the liberal-verse. Often gets in the way of acquiring good, useful knowledge…but there ya go.

    Like

  25. jsojourner says:

    Ed,

    Repetition is the linchpin of propaganda. Thus spake Goebbels. And the man was correct.

    I think one of his compatriots followed that little ditty up with something along the lines of, “The more you repeat the lie and the bigger the lie is, the more likely people are to believe it.”

    He, too, was correct.

    Fox News, World Net Daily, Newsmax, Newsbusters, Before Its News, Stormfront, the CCC and it seems more and more — CNN — it’s all beginning to look and sound like the same set piece.

    Like

  26. So how did Emmerich arrive at the inflated $16,500 number? I put the question to him, and he told me that he got it by estimating what it would cost the family to buy private insurance on the open market if they did not have Medicaid, applying his own copays and deductible to the equation. (Although Emmerich lumped CHIP into the same category as Medicaid in his chart, he didn’t consider the two benefits separately in this calculation—which is just as well, since children on Medicaid aren’t eligible for CHIP in the first place.) Even if we accept this dubious methodology, however, Emmerich’s numbers are extreme overestimates. I went to ehealthinsurance.com, a website that provides information on various insurance plans, and got price quotes for a 24-year-old woman with two young kids living near Jackson, Mississippi, where Emmerich’s newspaper is located. The costs were substantially lower than I expected—for less than $500 a month, the woman could cover herself and her kids, pay no coinsurance, and have only a $3,000 deductible. The grand total? Far less than $16,500.

    Just like a proggie to substitute an estimate for the benefits of actual experience.

    So the numbers end up different, one optimistic by design, the other pessimistic by design…the difference “proves” conservatives “can’t do math.” Love your logic.

    Like

  27. Ed Darrell says:

    Dear Reader, read through to the end of Mr. Singal’s column at New Republic.

    He explains why neo-cons can’t do math, and why these hoaxes get such great traction in the neconosphere:

    If Emmerich did not have a particularly clear sense of his methodology, he was sure of his logic: that his numbers prove government benefits are discouraging the poor from working. What’s more, he was sure the numbers he’d uncovered (or concocted, depending on how you look at it) would have an impact. “I thought, ‘You know, I bet if I send this out on my e-mail chain, I bet this thing could get circulated,’” he told me, referring to an e-listserv he’s on that regularly sends out links.

    Emmerich’s instinct was right. After about a month, his chart landed in a forum on Sean Hannity’s website. (“It demonstrates very nicely why productivity should never be taxed,” opined one poster. “And as a side demo, subsidy for sloth is another bad plan.”) It was also picked up by Yahoo! News via The Atlantic Wire. Countless other sites soon joined the list. And, somewhere along the way, the chart became credited to “Source: Wyatt Emmerich, theclevelandcurrent.com”—meaning even the citation got botched.

    A major node in this great game of Internet telephone was the conservative blog Zero Hedge, where, on November 21, poster “Tyler Durden” noted:

    Emmerich analyzes disposable income and economic benefits among several key income classes and comes to the stunning (and verifiable) conclusion that “a one-parent family of three making $14,500 a year (minimum wage) has more disposable income than a family making $60,000 a year.” … Ever wonder why Obama was so focused on health reform? It is so those who have no interest or ability in working, make as much as representatives of America’s once exalted, and now merely endangered, middle class.

    From Zero Hedge, the chart ascended to one of the highest points on the right-wing totem pole: The Corner. Veronique de Rugy posted the chart on this well-read National Review blog on December 10, around the time that President Obama was in the final stages of hammering out a tax deal that would include cuts on high earners. “Maybe President Obama and Mr. Krugman should direct some of their attention to this problem,” snarked de Rugy, “rather than spending so much of their time complaining that the rich don’t get soaked enough.” In other words, she took Emmerich’s chart at face value.

    Granted, The Corner doesn’t always comport itself in an impressive manner, but it’s still a blog for a major national publication. One would hope such a forum would check the numbers that supposedly back up a claim as provocative as Emmerich’s. And The Corner wasn’t the only website that disseminated Emmerich’s chart to a broader audience: The post on The Atlantic Wire (which was later mirrored by Yahoo! News) conveyed some skepticism about the chart and eventually linked to a handful of rebuttals, but the author of the post clearly didn’t look into the chart’s veracity for himself before publishing it. Instead, by posting the chart largely unchallenged, the blog implied that it might hold some relevance and legitimacy.

    Indeed, the real story here isn’t necessarily Emmerich’s fuzzy math; as important is the fact that the chart was posted again and again with so little discussion of its accuracy. If those who pushed the chart along in its Internet journey cared about its content and the methodology, rather than its underlying political message, they could have done a little Googling. It wouldn’t have taken much to crack the surface, get below the presumption that poor people are coddled by the government, and find the beginning of a long list of problems with Emmerich’s work. But, perhaps because of ideological bent or maybe due to simple laziness, people decided that no fact-checking was required.

    Emmerich, it turns out, was partially right. In Obama’s America, there are people who have little incentive to work: Internet pundits, particularly conservative ones—and especially those who think poor people are a threat to America.

    The Ghost of H. L. Mencken is lighting his cigar, blowing a smoke ring and saying, “Told you so.”

    It’s very much like that hoax chart claiming “Obama’s cabinet is the least business-experienced in history.

    Repeating lies that self-proclaimed conservatives tell as jokes at cocktail parties after they’ve had too much Scotch or gin and nothing to supplement the poverty in their knowledge or compassion, does not make them “facts.”

    There’s a rumor that Aldous Huxley once said, “Facts do not cease to exist because they are ignored.” (Proper Studies, 1927). Did he really say that?

    That’s true, it’s not a hoax.

    Like

  28. Ed Darrell says:

    I called it “balderdash” because it sounds like it. (And then I forgot about it; that was last July. Were there anything to that claim, it would be all over the economics journals in short order. Obviously I was right to call it balderdash. You should pay attention when I give you the good stuff.)

    Horse sense, Morgan. If you could make more money working minimum wage and taking vacation for 36 weeks a year without benefits, than someone with a $70,000/year job (a salary higher than most teacher salaries, by the way, and double what Michigan pays starting teachers), you’d probably do it. If not you, then thousands of other not-stupid rednecks around the nation who carp about how easy “them folks claiming to be in poverty” have it.

    You’re right, I made a snap judgment based on experience and a passing knowledge with numbers.

    But then, I’ve seen Section 8 housing, and I’ve never found one I’d live in. I’ve seen people trying to scrape by on food stamps, and I know I couldn’t do it. I’ve lived outside of New York and Washington, where one really does need a working car, and I know there are no programs, state, federal or municipal, to keep those cars running or pay for gas (Emerich didn’t include anything for transportation; he’s clearly not familiar with America).

    And with Emerich’s name, I found the rebuttal in a few seconds.

    You could have, too.

    Why did you pose the false claims in the first place, computer whiz that you are?

    And I know that even minimum wage jobs get taxed.

    Like

  29. Ed Darrell says:

    Regret my last post was so brief. My Hemingway Brand® Shock-Proof Shit Detector was screaming something fierce. After I hit send, I checked it, and it pointed me to this:

    “From Mississippi to ‘The Corner’: A Tale of Right-Wing Wrongness,” New Republic, February 8, 2011, by Jesse Singal.

    I wondered especially about the tax numbers, and while I was finding the “shuttup” switch on the Hemingway, I wondered about the fact that Mississippi is in a food desert, and I wondered if those numbers included the car to drive the 60 miles round-trip weekly to buy food (surely you’ve seen the stories of Congressmen trying to live on SNAP’s about $5/day).

    Singal checked the numbers out a bit more rigorously than Emerich did, and asked some experts. You should read his report, including this:

    For starters, Emmerich overestimated the federal tax liability of the $60,000 family by failing to distinguish between gross and taxable income (the $60,000 family only has $40,400 in taxable income, according to the CBPP) and by ignoring the child tax credit, which benefits wealthier families more than poorer ones. The family making $60,000 would actually pay only about $8,043 in payroll and income taxes, not $13,034. As for Medicaid, CBPP pointed out that a family making $14,500 wouldn’t actually be eligible in Mississippi, where the cutoff level of qualifying income for a family of three is a paltry $8,064 per year. Even if that family were eligible, however, Emmerich’s estimate of their benefits is way off. Medicaid is a relative bargain for Mississippi—the state spends, on average, $2,510 a year per adult beneficiary and $1,659 per child beneficiary, according to the most recent numbers.

    Singal also notes that “available benefit” is not the same as “disposable cash.” Almost none of the benefits mentioned come in the form of cash, so they cannot be used as disposable income. Baby can’t get new shoes on SNAP benefits; Section 8 payments won’t cover landscaping or a visit to the local community swimming pool in the summer, etc.

    Perhaps more frustrating than the chart’s numerical errors is the language that accompanies it. In the column he penned for his newspaper, Emmerich’s claimed that the family making $14,500 has more “disposable income” than the family making $60,000, a reference to the “total” numbers at the bottom of the chart. But the chart conflates disposable income with economic benefits. Some items on the chart, like the tax credit, are disposable income, unrestricted money the families can use as they please. But other items, like food stamps, are government benefits that must be used for specific purposes. Adding these two types of items together is like adding apples and oranges.

    When I asked Emmerich about his decision to use “disposable income” in his column to describe the totals in his chart, he quickly acknowledged that “‘economic benefit’ … is the more precise term.” But this error had already done its damage: As Emmerich’s chart and column gained momentum around the Internet, people continued to refer to its totals as “disposable income.” Then, like Emmerich, they used this descriptor to take an absurd leap of logic, asserting that, with money in their pockets, poor people have no incentive to hold jobs.

    Morgan, is it true that neo-cons can’t do math? Why is that?

    Like

  30. Ed,

    The real question is why did you debunk a study as “balderdash” when you didn’t know anything about it.

    Across the years, I have increasingly gotten the impression that you characterize things as “urban legends” when you simply don’t like them. I’m not getting much incentive to change my viewpoint on that here.

    Like

  31. Ed Darrell says:

    Morgan, since that study claims to make so much sense, why do you think more Americans don’t drop out of the economy and get a 1-week/month minimum wage job, and goof off?

    Sounds like paradise, doesn’t it?

    How do you explain that you and others in your Ayn Rand Fan Club don’t do what that chart claims you can do (albeit in Mississippi)?

    Like

  32. mkfreeberg says:

    Ah. I think I’ve finally found the study to which this person was referring. And we have a source: Wyatt Emerich of The Cleveland Current.

    The claim that the right wing wants to “return child labor to legal status” has been examined, and shot full of holes for the reasons I’ve given. So now that Ed has a chance to examine this other claim, and speak knowledgeably about it rather than just speculating: Why is it full of balderdash?

    And Mr. Kessler, I’d have to ask you what this has to do with your statement that “the incomes of everyone but the rich has [sic] flatlined for the last four decades.” That would be an entirely different thing. Although both claims could be interpreted and validated in lots of different ways.

    Like

  33. mkfreeberg says:

    Morgan, I\u2019ll make this simple for you. A guy making thirty million dollars is not going to buy thirty million dollars worth more of shirts.

    I’m afraid you’ve made it too simple to actually work. The claim was:

    Further studies have shown that families on welfare have more disposable income than the same size family with both adults working full time and earning $60,000 a year. The difference is they have to PAY for stuff.

    So I’m not entirely sure what you have in mind when you say something like:

    The proof? The incomes of everyone but the rich has flatlined for the last four decades.

    By “molding” the original claim, play-doh-like, into something you can more easily debunk, you’ve offered a rather shoddy example of discussing claims & rebuttals, and if this is what Ed had in mind when he called it “a pile of balderdash” then you’ve damaged his critical-thinking credibility as well.

    So AGAIN, let’s get back to my original question. How is it “a pile of balderdash” to say, families on welfare have more disposable income than the same size family with both adults working full time earning $60k?

    Like

  34. James Kessler says:

    Morgan, I’ll make this simple for you. A guy making thirty million dollars is not going to buy thirty million dollars worth more of shirts.

    The reason massive income inequality chokes the economy is that when you have too much money in the hands of too few they’re not sustaining, much less growing the economy, because they’re not spending enough money to do so.

    The proof? The incomes of everyone but the rich has flatlined for the last four decades.

    For your precious ‘trickle down’ to be valid all that money in the hands of the rich would trickle down into the wallets of everyone else. And the fact that the income growth of every class but the rich has shrunk drastically proves that isn’t the case.

    If your side so loves critical thinking then prove it by 1: watching Nick Hanauer’s speech at TED and 2: then intelligently critiquing it here.

    If you have ten people and one pie and you give one person 95% of the pie and the other nine have to split the remaining five percent are those Nine people really being fed adequately?

    Because economically that is what is going on.

    Like

  35. mkfreeberg says:

    You speak of critical thinking, and yet your title says that income inequality is a “snake that threatens to choke the economy.” You’ve offered no evidence to back that up. We’re having (again) an Inigo Montoya moment with the phrase “critical thinking”: I do not think it means what you think it means.

    You ask what the conservatives are smoking to think this is all about the “world owes me a living” mindset enduring from cradle to grave. Well…could be they’re applying REAL critical thinking to the motives of those on the left. Process of elimination, deductive reasoning, all that…if lefties really wanted America to be “great,” they wouldn’t be picking a fight with Newt for simply suggesting that kids should learn a work ethic at a young age. Real critical thinking says: There’s nothing wrong with that. Why such feelings of dread? Why so much fear?

    Like

  36. Ed Darrell says:

    America is made great by people working.

    America is made stupid, and America’s greatness is stunted when people believe, and say out loud, what those dope-smoking conservatives you quoted say.

    Critics on the right say the liberal vision nowadays is for the “world owes me a living” mindset to endure from crib to crypt.

    That’s not a liberal vision, not even a liberal idea. It may be the result of the conservatives’ idea that we can let China surpass us in educational attainment, and save money at the same time by slashing education spending — but it’s not the idea of liberals.

    Morgan, I think I know why you guys are so opposed to teaching critical thinking. You didn’t learn how when you were in school, and you’ll be doggoned if you’ll let any group of mostly-not-white students, like the kids in Texas and California, know more than you do.

    “Keep those kids stupid” is your mantra. You guys never look to the future to think, even for one moment, who will be wielding the scalpel when you need your fourth bypass, or when you need that brain aneurysm fixed. If you’re lucky, it might be a kid from China come to buy America out from under you. But you’d rather it not be a poor kid from the U.S. of A. They’re “not your kind,” you think, claiming something vaguely red-white-and-bluish, perhaps not even recognizing how you’re pushing your own doom.

    “Curse those Higher Order Thinking Skills,” you so-called conservatives say. “(They must be evil, since we don’t have a clue what they are!)”

    It’s not even a week after the Fourth of July. Can’t you guys pretend to like America for at least a whole week?

    (You know, even the columnists at the too-often-near-Nazi Forbes figured out the problem.)

    Like

  37. mkfreeberg says:

    What sort of dope do you think they’re smoking to come up with hallucinations like that?

    Cynicism, coupled with Scroogity, blinds the right wing to America’s enduring greatness, and the people who make it great. Shame on the right wing.

    America is made great by people NOT working? Since when?

    Like

  38. Ed Darrell says:

    Critics on the right say the liberal vision nowadays is for the “world owes me a living” mindset to endure from crib to crypt.

    What sort of dope do you think they’re smoking to come up with hallucinations like that?

    Cynicism, coupled with Scroogity, blinds the right wing to America’s enduring greatness, and the people who make it great. Shame on the right wing.

    Like

  39. mkfreeberg says:

    1. Gingrich, 2. Texas farmers, 3. Sen. Charles Grassley…

    My recollection is at least three states had serious proposals, too. Missouri for one.

    Ah, Newt’s shining moment. And he really mopped the floor with Mr. Williams. Good, that was a stupid question.

    2. and 3. do not support Nick’s statement, as the Texas farmers and Sen. Grassley were responding to proposed changes from the Department of Labor going in the opposite direction. Interesting time of year for us to be discussing this, as parents all across the nation are watching their kids’ thumbs dance across mobile game platforms, with their brains turning to mush…

    I cannot help but wonder at what age the progressives think work should start. Twenty? Twenty-five? If the family is receiving alms, when will our friends on the left allow the point to be made that you’re supposed to be doing something for other people, if they’re supporting you? Critics on the right say the liberal vision nowadays is for the “world owes me a living” mindset to endure from crib to crypt. This is exactly where that point seems to hold a lot of merit: Someone says “work” and the progressives immediately think of Oliver Twist.

    Like

  40. mkfreeberg says:

    While we’re waiting on that, have you got some “serious research” that proves “some on the right wing’s desire to return child labor to legal status”?

    Like

  41. Ed Darrell says:

    Further studies have shown that families on welfare have more disposable income than the same size family with both adults working full time and earning $60,000 a year.

    Like that: Easy to say, but it’s not backed by serious research. That’s a pile of balderdash.

    “Disposable income?” Unemployment benefits and foodstamps keep families hungry and out of housing in a few months.

    Please don’t make up stuff against Americans like that.

    Or, if you genuinely think someone has such a study, please show us.

    Like

  42. Ed Darrell says:

    Wow…for an “enlightened” think-tank…wouldn’t it be just as easy to say…there’s less people working hard and earning good pay…and more people letting Uncle Sam take care of them.

    Not if the think tank is trying to be accurate, trying to do hard analysis of what’s going on, in order to promote good thinking on solid solutions for our problems, no.

    Like

  43. hawkmo99 says:

    Wow…for an “enlightened” think-tank…wouldn’t it be just as easy to say…there’s less people working hard and earning good pay…and more people letting Uncle Sam take care of them. Throwing around a lot of numbers and percentages simply disguises the fact that by income, you are simply showing less people work for their money…but more get freebies. Further studies have shown that families on welfare have more disposable income than the same size family with both adults working full time and earning $60,000 a year. The difference is they have to PAY for stuff. While your welfare family may only “earn” a certain amount in cash per month…they have many…many…freebies and exemptions that the working family do not. In short…the only inequality we are truly seeing is that which the government is imposing by GIVING a living to those who should be working…and TAKING the living from those who do… Eventually…and we are getting close…there will not be enough “worker” families to SUPPORT the sit-on-your-ass-and-get free stuff families… Kinda like if you keep piling people in the cart…there’s nobody left to pull it… Sorry if that sounds “harsh”…but I really don’t care anymore. Why should I…nobody care’s about America…or what Obama’s done to it…or how they are turning on each other…why should I care if I’m too harsh…?

    Like

  44. […] “Income inequality: The snake that threatens to choke the U.S. economy” […]

    Like

  45. Nick K says:

    Ed, lets not forget some on the right wing’s desire to return child labor to legal status.

    Like

  46. Ed Darrell says:

    But take a closer look:

    In the 1990s, the Financial Accounting Standards Board, which regulates accounting practices, noticed this practice, correctly predicted the damage it would do to the economy, and then sought to curtail it. But Congress, spurred on by the lobbying efforts of major corporations, stopped the FASB in its tracks. As a result, Americans spent the 1990s and the first decade of this century living under 1970s accounting rules, which allowed top executives to more or less help themselves and, through the mutual back-scratching habits of corporate boards, help one another.

    Similarly, labor law has failed to keep up with the times. Policymakers have repeatedly failed to enact reforms that would have accommodated new union-organizing techniques and empowered unions to counter the growing power of business to resist labor’s demands. In this realm, the United States is running a twenty-first-century economy under 1940s rules. A clearheaded understanding of the power of drift in policymaking puts the Republican congressional minority during President Barack Obama’s first two years in a fresh light. Obsessive obstructionism is not just a symptom of general crabbiness; it is a shrewd and sensible part of a larger strategy to enrich corporations while gutting long-standing protections for the middle class.

    Why the Rich Are Getting Richer
    American Politics and the Second Gilded Age
    By Robert C. Lieberman
    January/February 2011

    Like

  47. Nick,

    This is where I’d be asking you why you don’t start your own blog. Except, of course, you and I have already had this conversation. You don’t feel like it, or can’t get up off your ass, or just like to argue on Ed’s blog, or something…

    This just looks more and more and more like what I think it truly is. Laziness. “Wah, the distribution of money is unequal (because some people get off their asses and do things and other people don’t), it’s got to be FIXED!”

    I don’t mean to say money == hard work. It isn’t…and in a way, that comes right back to my point. Some people choose to work hard and make not a whole lot of money doing it…they see a way to raise their kids properly, and get all their bills paid, and live sufficiently, on $30k a year. I disagree with that, personally, but it is a perfectly respectable lifestyle choice as long as they don’t look to you or me to bail them out.

    Actually, for that matter being lazy is a perfectly legit lifestyle choice too. As long as you’re not leaving a tab unpaid, or raising your kids poorly, or putting someone else in some other kind of a bind.

    And if you’re going to respect people who make these decisions…then, necessarily, you MUST say “Yes, Ed Darrell & crew, we do have income inequality in this country and that is quite alright.”

    Like

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