On the Income Gap

CNN recently published this article about how to “narrow the income gap.”

Narrowing the income gap may seem like a noble thing to do, but let’s break down what is actually happening here: to narrow the gap, all one has to do is make the salaries equal. If I have $10 and you have $1, but the government takes $9 from me, then the income gap is gone, and everyone is happy, right?

Let’s go through their list of “7 Ways” and see what is actually being said:

1. Break down the social barriers: Hey! This sounds fun, a rich person and a poor person can be friends. That sounds great! Nothing that can be legislated- just a common assumption that the average human being is moral and just, and that all moral, logical people can associate. Cool. I’m okay with this. Then we read a little farther, “If they talked more, they might support policies to help each other.” Woah. What policies? Will the poor finally vote to do away with taxes and punishing wealth and success? Unlikely. We know which policies. This author hopes that by rich people and poor people talking, the rich will feel guilty for their wealth and agree to be taxed at a higher rate. I already addressed “wealth guilt” in a previous post.

2. Improve public schools; unify them: hmm… this one is a little more cryptic. It spouts about education being the source of unification rather than division, increasing spending for schools and so on- all issues to address at a later time. You might mistake this article for simply misguided until the following sentence. “The community would benefit from closing its private school, Briarfield Academy, and creating a shared asset in the public school system.”
Read that again. Close down the school that is generating successful, productive students to “invest” in the public school system. Let that sink in.

3. Raise the minimum wage to 1960s levels, at least: Yawn. Same old, tired argument. The rich will simply absorb the higher wage cost and keep the price of all goods the same, and then everyone is better off right? I will address minimum wage in next week’s post in terms of morality.

4. Tax the rich at a reasonable rate: How does one decide what is a reasonable amount to steal? Who decides how much of my own money I get to keep? Do we decide by popular consent? Let’s just run with that for a minute- you say we are a democracy, and therefore should be able to vote on the tax rates. This means that because there are more poor people than rich, the poor can always vote to raise the taxes on the rich, and as long as they call the tax rate “reasonable” (91% tax rate for the top earners is a number thrown around). They also follow up with this paragraph, “It’s clear the rich are getting a big break on their taxes and should be paying more. The idea isn’t to take so much money that taxation, in and of itself, closes the income gap. It’s to use that tax money to fund programs, like public education, that could give everyone a fair shot at success in an economy that only serves the very wealthy.” That’s like saying “that robber only took some of your stuff. That’s a big ‘break'”. No, it’s not. They also admit that taxation won’t close the income gap (duh), but will fund education that could give “everyone a fair shot at success in an economy that serves only the wealthy.” Wait. What do the rich get for their tax dollars? Schools that they don’t use? The same police, fire, and army that the poor get? But they pay significantly more for it. But it only serves the rich, right?

5. Give workers a voice in their companies: What say do they want? They already have the ultimate say: if someone does not like the conditions which they endure at their job, they are free to quit. That’s your say. No, you don’t get to dictate your job to your employer. No, you don’t get to dictate your wages to your employer. No, you don’t get to dictate what benefits you receive from your employer. You can ask. You can suggest. You can leave. That is your say. If you found, build and manage a company, you should not have to take every broom pusher’s ‘voice’ as a gold standard. It’s your company. A good company will evaluate its benefits frequently to ensure that they retain the best workers. But it is not a requirement. If I ran a company- the first time an employee told me what I *must* do would quickly be shown the door. If he sued me, I’d close the whole company.

6. Reign in crazy-huge donations to political campaigns: Fine. Start with Bloomberg and Mayors Against Illegal Guns, Ted Turner, and George Soros. Actually, your claim is totally unsubstantiated: “Rich people these days have the ability and access to essentially buy — or heavily influence — political campaigns.” I’m not saying it isn’t true- I’m saying this statement is just an empty phrase. It says “rich people buy elections” with no examples of this. It’s mixed in with a graph about cost of elections, but that does not prove “rich people buy elections.” There is no correlation between the two. If you aren’t paying attention, you might think there is- and that those evil rich can simply invest in a congressman to do their evil bidding.

7. 7. Give money to the poor — maybe at random: OK, random acts of kindness are great. But did you really expect us to say that because “Cash transfers have been shown, for instance, to reduce HIV infection rates in Malawi and reduce the incidence of low birth weight in Uruguay” that dropping a butt ton of money on the poor side of town will make things better? Ever meet a lottery winner? Quite a few of them are flat broke- they had no connection to the money- it appeared and disappeared. There was no effort in receiving the money, and therefore, no judgment about how it is spent.

As stupid as this article is, it is a trial balloon. If it flies, we can expect to see more of them- more commentary on how to “bridge the gap”, always in ways to take your freedom.

“But what do we do about the income gap?” Not worry about it. What these people are attacking is the difference between the rich and poor. They aren’t so much complaining that the poor don’t have- they complain that the rich have. We focus on the gap because it is easier than focusing on the fact that even the poor have a decent standard of living in this country. Almost everyone has a television. This entire article was laced with this attitude. Instead of focusing on the income gap, encourage those at the bottom end to achieve and improve their own standards of living.


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