I don’t think that Matthew Schoenfield quite gets the point about income inequality:
From 2000-10, many of the 34 OECD countries propped up growth by launching expansive social programs with borrowed money. But not all. The five most “unequal†countries in the OECD report—Israel, the United States, Turkey, Mexico and Chile—largely abstained. They increased sovereign debt by 3% on average compared with a 40% average increase among other OECD members.
When austerity pressures caught up to debt-laden sovereigns in recent years, however, the less leveraged—and not coincidentally, less equal—member countries grew a lot faster than their peers. From 2011-13, according to the World Bank, the five most unequal countries grew nearly five times faster (3.9% cumulative annual average) than the others (0.84%). By using a 2010 cutoff, the OECD has skewed its findings.
Here’s the point. During the recovery the top 1% of income earners have captured 95% of the growth. Under the circumstances why should the lower 99% of income earners care whether the income is growing or not?
In addition the effective tax rate of the top 1% of income earners has been decreasing. That makes it darned hard to be sympathetic about the high taxes they pay, especially for those (like Warren Buffett) who effective tax rate is admittedly below that of his secretary.
The 99 %ers should be grateful to the 1 %ers for not taking 100% of the income gains, the miserable wretches.
My libertarian friends say this is not an issue because color TVs are cheaper.
Steve