Americans Becoming More Unequal?

According to a large story in the Minneapolis Star Tribune on January 26th, income inequality is widening. Wrote David Westphal, "income inequality is likely to deepen beyond its growth of the 1980s and 1990s, when incomes of affluent Americans grew more than three times faster than those of the low-income."

"Inequality is growing in all parts of the country," said Jared Bernstein, senior economist at the Economic Policy Institute.

However, as Patrick Chisholm observed in the Christian Science Monitor,

"Certain trends have been favoring the left for the past several decades. In the early 1960s, transfer payments (entitlements and welfare) constituted less than a third of the federal government's budget. Now they constitute almost 60 percent of the budget, or about $1.4 trillion per year. Measured according to this, the US government's main function now is redistribution: taking money from one segment of the population and giving it to another segment. In a few decades, transfer payments are expected to make up more than 75 percent of federal government spending."

During the first five years of Bush's presidency, nondefense discretionary spending rose 27.9%, as opposed to 1.9% in Clinton's first five years.

The Star Tribune, however, fretted only over how to solve the growing "income inequality," which consumed over half a page of the paper. "Now is an opportune time for states to act," [said one analyst]. "The choices the states make over the next couple of years could serve to widen or narrow the income gap."

The way states should "act," undoubtedly, is to raise taxes. It's absurd to talk about "inequality" without placing it within an economical and historical context -- unfortunately, those are two subjects that today's journalists are neither cognizant nor fond of.