Is Income Inequality Really a Problem?

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Originally Posted by Gregg

I've dealt with quite a few oil service companies over the years. I can tell you that there are very few industries better at long term strategic planning than the petroleum industry.

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i would agree with this. relatively, there are few incidents to be concerned about. but the i think of the gulf of mexico. messy. fracking. also messy.

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Regarding what they provide.... Consumers demand what oil can do for us. So far oil is the only source of highly concentrated, highly transportable, affordable energy we have discovered. No substitute exists (again, so far). The oil companies do what they do because we, consumers, place a very high value on their product. If we change our buying habits and begin to demand something different the mix of available products in the marketplace will change accordingly.

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true indeed.

when you are afraid to go to the nearest city for Christmas shopping because of the growing violence, then yes, it is a problem. Young men prowling the parking lots with guns and knives for an easy score. Many of these young men would be working if given the opportunity for a living wage. No one wants to hear this or face it.

For anyone who is interested in the practical effects of income inequality, I recommend 'The Spirit Level' by Richard Wilkinson and Kate Pickett. They are university epidemiologists and the book is a review of a large number of academic and government studies into inequality from all over the world.

The interesting thing is that so many problems appear to be worse in more unequal countries. For example, here are infant deaths per 1,000 live births, graphed against inequality:

http://www.equalitytrust.org.uk/imag...-mortality.gif

Here are teenage births:

http://www.equalitytrust.org.uk/imag...age-births.gif

This is the graph for homicides:

http://www.equalitytrust.org.uk/images/violence.gif

Some of the measures are clearly more closely related to inequality than others, but they all apparently have links which are statistically significant and they appear to be applicable within countries as well as between countries. For example, here is a graph showing the percentage of high school dropouts by US state:

http://www.equalitytrust.org.uk/imag.../education.gif

Fascinating, no?

Kevin

Very much so, Kevin. There is a lot of effort to cloud the problems with systemically high levels of income inequality as "class warfare", but the dangers to a society of having really huge levels of inequality affect everyone, even the rich who cannot completely insulate themselves from the effects with their money.

Societies work best when the majority of their citizens have a reasonably good quality of life, access to good schools, education and opportunity. And lower levels of societal inequality mean a large, as well as vibrant and healthy middle class.

The level of societal inequality in the U.S. approaches that of many Third World nations, and is far more similar to that world than to the world of the other developed Western democracies.

It's just not good for our society. However good it might be for the top percent or so of our citizens.

Thanks for those graphs......they show a very interesting side of some of the effects of societal inequality. And, I'm sure, things that many would not realize can be so dramatically shown to have a correlation with it.

Correlation. Causation. They both begin with the letter "C". But they don't mean the same thing.

Consider reading:

http://static6.businessinsider.com/i...0007/image.gif

http://www.edwardtufte.com/tufte/gra..._bookcover.gif

I appreciate these graphic illustrations. They put in picture form my immediate response to Gregg's query... When I saw the question "is income inequality really a problem?", my reply is that the impacts of income inequality is what is the problem.

I live in SE Seattle, with a mix of incomes in our immediate neighborhood, and many very low income neighborhoods in the area. I have seen up close and personal what the impacts of this recession/depression have been on my neighbors of color - except that for many of them, it started 5 years prior to the official announcement of 'recession'. Job loss, home loss, and obvious poverty in families who had been working class yet with a stable home, enough food, & car in good repair.

The foreclosures in my neighborhood have been a result of job loss, not the stereotype (and I believe, false) blaming-the-victim stories of using one's home as a cash machine. Example: a Honduran immigrant family raising their darling girls, now in college, in a Habitat house. Their father worked as a merchant marine. He lost his job, fell behind on his payments, and could not get help refinancing due to the disaster that is banking today, so his family lost their home. Predatory, high profit unregulated vampires... I detest big banks.

The impacts of income inequality mean that many familes cannot meet their basic needs. Kids go to school hungry, their brain development suffers, they grow up impaired, they raise their kids in less than optimal circumstanes, and we have generations of problems.

Profit at the expense of the basic health & well being of each other is wrong, immoral, and should be prosecuted as criminal. Human societies exist to make life better for ALL of us. I look forward to the day that income, in other words, basic resources needed to make life work, is equalized across all the divisions we have invented that treat others as less than.

PS...Bae, do you know that the graphs posted do not have data behind them, or are you assuming that?

You might find some of this information helpful, redfox.

http://www.equalitytrust.org.uk/why/evidence/methods

and here's the main page, where you can branch out to the various links:

http://www.equalitytrust.org.uk/why

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Originally Posted by bae

Correlation. Causation. They both begin with the letter "C". But they don't mean the same thing.

Consider reading:

http://static6.businessinsider.com/i...0007/image.gif

http://www.edwardtufte.com/tufte/gra..._bookcover.gif

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Nice book covers. What assumptions have you made about the charts shown that led to posting these?

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Originally Posted by bae

Correlation. Causation. They both begin with the letter "C". But they don't mean the same thing.

Consider reading:

http://static6.businessinsider.com/i...0007/image.gif

http://www.edwardtufte.com/tufte/gra..._bookcover.gif

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I know how touchy you get when people assume that you've said something, so I won't assume anything. Instead I'll just ask what your thoughts are about Kevin's charts. Based on your post I have not the faintest idea what you think.

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The foreclosures in my neighborhood have been a result of job loss, not the stereotype (and I believe, false) blaming-the-victim stories of using one's home as a cash machine.

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Nah, I think it was real. Even with a good job,very few can actually afford say a 1/2 million dollar house (and the average housing price in many parts of southern CA was up to around 700k at one point). And yet someone was buying. All rich people or was maybe someone buying beyond their means? You need at least a 6 figure combined income to realistically afford here even now really, not that many have it ...