Saturday, September 3, 2011
When the Rich Get Richer, It DOESN'T Raise All Boats ... It SINKS The Standard of Living For Everyone Else
I've repeatedly noted that rampant inequality destabilizes the economy as a whole, and actually causes depressions ... but that government policy is increasing inequality.
I've also pointed out that no one - liberal or conservative - likes runaway inequality.
Now, Jeffrey P. Thompson (Assistant Research Professor at the Political Economy Research Institute of the University of Massachusetts, Amherst) and Elias Leight (Assistant Analyst Tax Analysis Division of the Congressional Budget Office) have demonstrated that when the wealthiest Americans get richer, everyone else becomes poorer.
For example, they demonstrate that when the wealthiest Americans get 10% richer, middle income Americans get 2% poorer.
2 comments:
→ Thank you for contributing to the conversation by commenting. We try to read all of the comments (but don't always have the time).
→ If you write a long comment, please use paragraph breaks. Otherwise, no one will read it. Many people still won't read it, so shorter is usually better (but it's your choice).
→ The following types of comments will be deleted if we happen to see them:
-- Comments that criticize any class of people as a whole, especially when based on an attribute they don't have control over
-- Comments that explicitly call for violence
→ Because we do not read all of the comments, I am not responsible for any unlawful or distasteful comments.
Subscribe to:
Post Comments (Atom)
Posts
A rising tide lifts all yachts.
ReplyDeleteA lot has to do with why the rich are getting richer. If the rich are getting richer because production is increasing, then the chances are that the poor are getting richer as well. If, on the other hand, the economy is shrinking, and the rich are getting richer through political advantage, then their wealth is made up by the poor getting poorer. Unfortunately, we are in the second boat right now.
ReplyDelete