Politicians and reporters often rail about “the rich getting richer and the poor getting poorer.”
But John Stossel explains it’s not true.
In fact, the incomes of poor and middle-income Americans are up 32% since the government began keeping track several decades ago. https://www.cbo.gov/system/files?file=2018-11/54646-Distribution_of_Household_Income_2015_0.pdf
Yes, that increase is adjusted for inflation.
Another misleading claim, says Stossel, is the idea that the U.S. “no longer has economic mobility.”
But a paper in The Quarterly Journal of Economics found that most people born to the richest fifth of Americans fall out of that bracket within 20 years. (Table 2: https://academic.oup.com/qje/article/129/4/1553/1853754 ) Likewise, most born to the poorest fifth climb to a higher quintile. Some climb all the way to the top.
Another claim is that inequality itself is a huge problem.
New York City mayor Bill DeBlasio warns: “There’s inequality in this country right now that is threatening to tear us apart.”
Stossel says that it might tear us apart — but only if people come to believe that all inequality is evil.
But it isn’t, he says. It’s just part of life. Some people are better singers than others. The best athletes are just physically different.
Society doesn’t try to equalize those things — or many others — for good reason.
Former investment banker Carol Roth tell Stossel, “I have two kidneys. There are people out there who need one, don’t have one that functions. Should the government be able to take my kidney because somebody else needs it?”
“There’s inequality in everything,” she adds. “There’s inequality in free time. There’s inequality in parents. I don’t have any parents or grandparents. Life is unfair … unfair is a feature. It’s not a bug.”