Income Inequality

Now that I'm getting back to Stiglitz's "The Price of Inequality" -- and having read the voters pamphlet for the upcoming primary on the toilet this morning, wherein several candidates mentioned "income inequality" -- I think the Left has the wrong end of the stick on this.

Saying "income inequality" is bad implies that everyone should have an equal amount of income, which is patent nonsense. People who work harder, people who take more risks SHOULD have more money.  There's a reason "rich" and "famous" travel together.

No, I think the problem is the tax code. Higher incomes should be taxed at a higher rate, and income from investments should be taxed at a higher rate than income from wages. Stock options should have a moratorium on cashing them out that is measured in decades, not years, months or days.

What we have is not "income inequality" but "tax inequality."  Those who benefit most from the economy should also contribute the most to sustaining it.

To some great degree, the "winnings" of the financial winners belong to the game, and should be plowed under to nourish the next crop of winners and losers.

NoCoPilot wrote:

Saying "income inequality" is bad implies that everyone should have an equal amount of income, which is patent nonsense.

Of course not. A certain degree of inequality is no problem at all. When Ben & Jerry's started, they had a rule that the highest-paid people at the company could only make ten times what the lowest-paid people at the company made. So the CEO's salary was tied directly to the salary of the guy who swept the floor. Was this a problem? Apparently not - the company was hugely successful. But when the CEO makes hundreds of times as much as most of the employees (and is rewarded with multi-million dollar bonuses if he is so incompetent that he gets fired), that's a problem. That's what happens at a lot of places these days. Look at the big financial companies.

From a purely marketing standpoint -- and he who controls the terminology controls the discussion -- "income inequality" is born DOA.  Anyone talking about income inquality is tacitly endorsing the Right's shrill lies about "income redistribution."  This kind of talk polls horribly.

A better entry point to the discussion is to talk about "regressive taxes."  Those sound bad on the surface, and are bad when the full effects are discussed.  It opens up a much more useful discussion about the tax burden, and who owes what for what they have.

The problem isn't unequal income.  Incomes SHOULD be unequal -- but with the added benefit of a high income should come the added responsibility of a debt to society.

And, coincidentally, high taxes on capital gains encourage investment -- something the fucking far-Right seems to have removed from the public discussion.