Income Inequality

Gonna write this blogpost at the risk of being called a racist.  I am not and don’t appreciate it when people with others shout racist when they are losing the argument. It won’t be the first time and it won’t be the last.  Honestly, I just treat people the way I’d like to be treated.  The Ten Commandments seem to work pretty well when you are thinking about how you should work with people.

Looking at two recent Supreme Court decisions will give you a clue.  The first one on discrimination and gays is a case and point.  I don’t find a lot of people that want to actively discriminate against gay people.  Gays have become an accepted part of our population.   There are stragglers, but it’s not even close to what it was.  In his dissent, Justice Kavanaugh raises the question of why the court should be making law from the bench.  Isn’t that the job of the legislature?

The second example is the DACA decision.  Obama created an executive order and then Trump created an executive order.  Why is one better than the other?  In fact, why isn’t the legislature doing anything about it?

If both these decisions aren’t a great argument for term limits and ending gerrymandering I don’t know what is.  The legislature in America is dysfunctional.

I don’ think that income inequality has a ton of correlation with race.  Remember, there are an awful lot of poor white people too.  There are poor people in every race.   I am not dismissing racism, but I think the conversation right now on income inequality is focusing exclusively on race and that’s a problem we aren’t going to fix.

America is a society where there is income mobility despite what you read in the news that says it isn’t happening.  Economist Russ Roberts of EconTalk has done a lot of research on this and found that it is still true.  As a matter of fact, even with all the resources, it is tougher for very wealthy children to do as well as their parents.  For example, it’s highly unlikely that Bill Gates offspring will create as much wealth as he has created.

Professor Gary Becker did a lot of research on poverty.  He uncovered a lot of data and ways to cure poverty.  His paper on how racists penalize themselves by not being open to hiring and working with people different than themselves was seminal.  One big thing he uncovered makes a lot of people very very uncomfortable because the cure to those ills runs directly opposite to the policies they support.

• People who grow up in two-parent families do better than people who grow up in one-parent families.
• People who graduate from high school do better than peers.  People who graduate from college do even better.

Obviously, there are exceptions to generalizations and we all can find them.  However, the data is the data and you can’t make public policy for exceptions.  When you start to think hard about just those two issues and the policies surrounding them, everything starts to get rubbed the wrong way.  When you involve public-sector unions, the lines get drawn really quickly.  Much of America’s policy is not about helping people, it’s about pure unvarnished political power.

Becker was far from a racist.  Russ Roberts is far from racist too.  Becker and Roberts favor things like school choice to create better educational opportunities for people. Why? Because it creates a competitive market and competitive markets are good for people.  If you think about it, the fact that America has poor families that have not escaped poverty for generations creates deadweight loss in America. Think about how much better everyone’s standard of living would be if we weren’t warehousing poverty.

If people want to march and protest income inequality, fine with me.  It’s appreciated.  Creating opportunities and making the pie bigger is something we all should be behind.  However, unless they are also willing to put in place actual policies that work to solve the problem instead of policies that simply are redistributive, their marching is a fool’s errand.