In his widely noted speech, President Obama said that “a dangerous and growing inequality and lack of upward mobility” is “the defining challenge of our time.” This belief makes Mr. Obama unique: Unlike the other presidents since World War II, he places inequality above economic growth as the organizing principle of U.S. economic policy. The president’s Dec. 4 speech, at an event hosted by the Center for American Progress, also stressed that increasing inequality is a “decades-long trend”—which carries with it the strong implication that the country needs to reverse the direction it has taken for the last three decades. But like so many of his other pronouncements, the assumptions behind his defining challenge are misleading.
Virtually all of the data cited by the left to decry the supposed explosion of income inequality, as Lee Ohanian and Kip Hagopian point out in their seminal paper, “The Mismeasure of Inequality” (Policy Review, 2011), use a Census Bureau definition of “money income” that excludes taxes, transfer payments like Medicaid, Medicare, nutrition assistance, the Earned Income Tax Credit, and even costly employee benefits such as health insurance.
Thus the data that is conventionally used to calculate the so-called Gini coefficient—the most commonly used measure of income inequality—ignore America’s highly progressive income tax system and the panoply of benefits and transfer payments. According to Messrs. Ohanian and Hagopian, once the effect of taxes and transfer payments is taken into account, “inequality actually declined 1.8% during the 16-year period between 1993 and 2009, when the Gini coefficient dropped from .395 to .388.”
Read the rest of Robert Grady’s op-ed at WSJ:
This is because he is following the socialist/communist model, where all (with the exception of the central planning ruling class,) are to be made “equal” (which does not result in them either becoming prosperous or sharing the profits.)
Funny, the Socialist Ideology of “equality” from our Defacto President….has left the equality G A P even W I D E R…
No poor or distressed persons have ever gotten “rich” or even lead a moderate lifestyle….off of Government dependency….the getting rich part is left up to the POLITICIANS and our very own ELITISTS now in our (ever corrupt) Government.
Even the Obama lovin’ Liberals have been hit in their pockets…or will be….can’t fix stupid.
If these folks are really serious then the first order of business is to cut their salaries down to the average Americans. To make it more equal. Afterall that’s the goal right? So every congressperson and senator take a big cut in pay. They are our leaders so I say let them lead. Then I may follow. Until then shut up about it.
@FAITH7:
It is a socialist-oligarchy (not so different from feudalism,) where lords and royalty live in splendor befitting the ruling caste, while the peasantry live at a specified level of sustenance and education level to keep them subservient. All are to be equal, but a select few who will be more equal. With the exception of a few “gifted” individuals who will be culled from the servant class, sponsored and allowed positions of privilege, the little people will indentured to the ruling State to which all belongs. Hidden in Obamacare is a clause that gives the State authority to seize the estates of all who accept medicare. Thus once a peasant dies, the all powerful State can take everything the person worked for all his life and do with it as it will. Their survivors will remain servants of the State who may in seeming benevolence allow them to remain in their home, (so long as they are loyal subjects,) or relocate them to “more suitable” section eight housing, trapping them in the peasant class.
It is of course necessary to disarm the serfs, to keep them from rising up against the governing oligarchy, which is why Obama and the socialist far-left must put in place laws justifying the State’s actions in the confiscation of arms for whatever vague excuse possible that can be inserted in law. The State will keep semblance of elections, where only those candidates deemed “electable”, will be allowed to run (all populists will be made to be “unelectable” via the State controlled media). Appointed officers will make certain that the desired election results occur, if necessary ballots will be “stuffed” by operatives, or will be found to assure the proper outcome. The peasant class will no longer be allowed to send in representatives to review the vote counting process, instead certain persons will be cleared by the elections department to serve that function, giving an atmosphere that ‘all is as it should be.’
The more nearly equal a country’s income distribution, the closer its Lorenz curve to the 45 degree line and the lower its Gini index, e.g., a Scandinavian country with an index of 25. The more unequal a country’s income distribution, the farther its Lorenz curve from the 45 degree line and the higher its Gini index, e.g., a Sub-Saharan country with an index of 50.
So, what’s been happening under Obama?
Our Gini index has moved away from equality!
Today it is 45. 3.
We were better off under Bush!