Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Income Inequality
Townhall.com ^ | January 15, 2014 | Walter E. Williams

Posted on 01/15/2014 1:38:00 PM PST by Kaslin

Democrats plan to demagogue income inequality and the wealth gap for political gain in this year's elections. Most of what's said about income inequality is stupid or, at best, ill-informed. Much to their disgrace, economists focusing on measures of income inequality bring little light to the issue. Let's look at it.

Income is a result of something. As such, results alone cannot establish whether there is fairness or justice. Take a simple example to make the point. Suppose Tom, Dick and Harry play a weekly game of poker. The result is: Tom wins 75 percent of the time. Dick and Harry, respectively, win 15 percent and 10 percent of the time. Knowing only the game's result permits us to say absolutely nothing as to whether there has been poker fairness or justice. Tom's disproportionate winnings are consistent with his being either an astute player or a clever cheater.

To determine whether there has been poker justice, the game's process must be examined. Process questions we might ask are: Were Hoyle's rules obeyed; were the cards unmarked; were the cards dealt from the top of the deck; and did the players play voluntarily? If these questions yield affirmative answers, there was poker fairness and justice, regardless of the game's result, even with Tom's winning 75 percent of the time.

Similarly, income is a result of something. In a free society, for the most part, income is a result of one's capacity to serve his fellow man and the value his fellow man places on that service. Say I mow your lawn and you pay me $50. That $50 might be seen as a certificate of performance. Why? It serves as evidence that I served my fellow man and enables me to make a claim on what he produces when I visit the grocer. Google founders Sergey Brin and Larry Page are multibillionaires. Just as in the case of my serving my fellow man by mowing his lawn, they served their fellow man. The difference is they served many more of their fellow men and did so far more effectively than I and hence have received many more "certificates of performance," which enables them to make greater claims on what their fellow man produces, such as big houses, cars and jets.

Brin and Page and people like them created wealth by producing services that improve the lives of millions upon millions of people all around the globe. Should people who have improved our lives be held up to ridicule and scorn because they have higher income than most of us? Should Congress confiscate part of their wealth in the name of fairness and income redistribution?

Except in many instances when government rigs the game with crony capitalism, income is mostly a result of one's productivity and the value that people place on that productivity. Far more important than income inequality is productivity inequality. That suggests that if there's anything to be done about income inequality, we should focus on how to give people greater capacity to serve their fellow man, namely raise their productivity.

To accomplish that goal, let's look at a few things that we shouldn't do. Becoming a taxicab owner-operator lies within the grasp of many, but in New York City, one must be able to get a license (medallion), which costs $700,000. There are hundreds of examples of government restrictions that reduce opportunity. What about the grossly fraudulent education received by so many minority youngsters? And then we handicap them further with laws that mandate that businesses pay them wages that exceed their productivity, which denies them on-the-job training.

Think back to my poker example. If one is concerned about the game's result, which is more just, taking some of Tom's winnings and redistributing them to Dick and Harry or teaching Dick and Harry how to play better? If left to politicians, they'd prefer redistribution. That way, they could get their hands on some of Tom's winnings. That's far more rewarding to them than raising Dick's and Harry's productivity.


TOPICS: Business/Economy; Culture/Society; Editorial
KEYWORDS: incomeinequality

1 posted on 01/15/2014 1:38:00 PM PST by Kaslin
[ Post Reply | Private Reply | View Replies]

To: Kaslin

The guy who convinces you that your income is unfair, and to whom you give the power to fix it, becomes king.

You have 10 bucks. Your buddy has a hundred. With your help I extract 10 bucks from your buddy. So now you have 20 to his 80 and I own both of you. You need me to get more from your buddy and he needs me to keep you from mugging him.

I am now your king.


2 posted on 01/15/2014 1:42:03 PM PST by marron
[ Post Reply | Private Reply | To 1 | View Replies]

To: Kaslin

War on women.
Income inequality.
Fund a libertarian to split the non-Dem vote.

It’s all obvious but can we defeat it?


3 posted on 01/15/2014 1:43:21 PM PST by nascarnation (I'm hiring Jack Palladino to investigate Baraq's golf scores.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Kaslin

Sorry but

“INCOME INEQUALITY” is not in the US TAX CODE IRS,
but “EARNED INCOME” is

“Oct 24, 2013 - EITC, the Earned Income Tax Credit, sometimes called EIC is a tax credit to help you keep more of WHAT YOU EARNED.”

Sorry you SOB Bum Obummer, you can`t have it both ways.


4 posted on 01/15/2014 1:44:49 PM PST by bunkerhill7 ("The Second Amendment has no limits on firepower"-NY State Senator Kathleen A. Marchione.")
[ Post Reply | Private Reply | To 1 | View Replies]

To: Kaslin
But how in the world did those "certificates of performance" get changed into the thousands of "certificates of utter non-performance" I had to send in for my quarterly tax payment today.
5 posted on 01/15/2014 1:46:12 PM PST by KarlInOhio (Republican amnesty supporters don't care whether their own homes are called mansions or haciendas.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Kaslin

Success or failure or mediocrity are all in between the ears.


6 posted on 01/15/2014 1:46:22 PM PST by Blue Collar Christian (Vote Democrat. Once you're OK with killing babies the rest is easy. <BCC><)
[ Post Reply | Private Reply | To 1 | View Replies]

To: bunkerhill7

He thinks he can, because he thinks he is an emperor and therefor an absolute Ruler, like Nero, or Napoleon Bonaparte were


7 posted on 01/15/2014 1:49:40 PM PST by Kaslin (He needed the ignorant to reelect him, and he got them. Now we all have to pay the consequenses)
[ Post Reply | Private Reply | To 4 | View Replies]

To: Kaslin

Who decides what is fair and what is too much inequality? Why do they get to be the ones who decide? And how do they know it? Why not let the free market decide? That will be the most optimal, most efficient, and most beneficial way to produce and distribute.


8 posted on 01/15/2014 1:50:34 PM PST by mjp ((pro-{God, reality, reason, egoism, individualism, natural rights, limited government, capitalism}))
[ Post Reply | Private Reply | To 1 | View Replies]

To: KarlInOhio

But how in the world did those “certificates of performance” get changed into the thousands of “certificates of utter non-performance”...

That’s the governments job. It’s magic. Government regulation defying natural laws.


9 posted on 01/15/2014 1:50:46 PM PST by Blue Collar Christian (Vote Democrat. Once you're OK with killing babies the rest is easy. <BCC><)
[ Post Reply | Private Reply | To 5 | View Replies]

To: Kaslin

I hope to see conservatives take the bull by the horns on this issue.

I will frustrate liberals to say this, but I am in favor of income inequality. In that, I think it’s fair and right and proper that surgeons earn more than hired help at fast food restaurants. I think it’s fair and proper that skilled building tradesmen such as electricians, get paid more than “gofer” workers at construction sites.

It’s fair and proper that lawyers earn more than someone who does janitorial or housekeeping work.

I welcome this debate that the liberals apparently want to have. I would have to say that I’m in favor of inequality, whereas the liberals want to push this meme that inequality is bad. Why is it bad? Let’s have the debate.


10 posted on 01/15/2014 1:51:14 PM PST by Dilbert San Diego
[ Post Reply | Private Reply | To 1 | View Replies]

To: mjp

“That will be the most optimal, most efficient, and most beneficial way to produce and distribute.”

We are talking about the government here aren’t we?


11 posted on 01/15/2014 1:52:40 PM PST by Blue Collar Christian (Vote Democrat. Once you're OK with killing babies the rest is easy. <BCC><)
[ Post Reply | Private Reply | To 8 | View Replies]

To: Kaslin

How much more ‘income inequality’ can you get than JOBLESSNESS AND SUSTAINED HIGH UNEMPLOYMENT under Obama?


12 posted on 01/15/2014 1:55:32 PM PST by CivilWarBrewing
[ Post Reply | Private Reply | To 1 | View Replies]

To: Blue Collar Christian

Friend of mine works at Verizon and all they do is complain about the CEO’s salary. Biggest knock on him. They say he can’t do their job troubleshooting circuits. I wonder if they can even comprehend what the CEO actually does?


13 posted on 01/15/2014 1:58:22 PM PST by massgopguy (I owe everything to George Bailey)
[ Post Reply | Private Reply | To 11 | View Replies]

To: Kaslin

Income inequality is bad. The congressjerks make more than me. Plus they get perks that I don’t get. Plus they get free healthcare, plus free parking.

Let’s be fair. They should make what I make. They should get the same priviliges as me (none).

Then we’d have income equality.

One good thing about income equality would be simpler tax filing. Everybody makes the same money, everybody pays the same taxes.


14 posted on 01/15/2014 2:10:21 PM PST by I want the USA back (Media: completely irresponsible traitors. Complicit in the destruction of our country.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Kaslin

Financial elites must laugh and laugh at this, until they cry they laugh so hard.

Of course, of the total number of people actually earning mimimum wage, only a minute fraction of them ever actually attend any “demonstration”.

Because most people realize that are low wage earners definitely desire to earn more than the “minimum”. For most people, minimum wage jobs are temporary and transitional, only part of the household earning picture.

The usual organizers round up their troops and put the “demonstrations” on, while the rest of the world goes on working.

The elites’ news media, of course, uses it as fodder to feed their liberal viewers on the 6 o’clock snews.


15 posted on 01/15/2014 2:11:46 PM PST by PieterCasparzen (We have to fix things ourselves)
[ Post Reply | Private Reply | To 1 | View Replies]

To: mjp
"Were Hoyle's rules obeyed;"

Hoyle is Washington's free trade and tax rules where an American corporation [aka person] can ship employees jobs outside the country and cause an unemployment recession resulting in 1% raking in more of the pot than the 99%. Brightness and capability are a plus for the capable but this is a stretch.

16 posted on 01/15/2014 2:22:23 PM PST by ex-snook (God is Love)
[ Post Reply | Private Reply | To 8 | View Replies]

To: Kaslin

If left to politicians, they’d prefer redistribution.
that:
Free Bubble up
and
Rainbow Stew
These idiots think they can bring about prosperity by spending printed money and picking winners and losers. Classic example is their green energy aptitude and waste versus what should be an economically winning energy plan.
Picking winners and losers is not up to them, the free market system will take care of it. Takers don’t need to be in business helped with tax money and competing with the ‘you did build that businesses’ with a first pig at the trough advantage of being classified as disadvantaged to start with.


17 posted on 01/15/2014 2:22:43 PM PST by Recompennation (Constitutional protection for all not ju st selectively for Democrats.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Kaslin
When the dipwad who wants part of my income averages 60 hours per week for 45 years-and-counting he can have some of my $. Of course, if he does that he won't need any of my $, will he. How about my complaint about effort inequality, discipline inequality, dedication inequality, sacrifice inequality...

Well, you get the drift. sigh

18 posted on 01/15/2014 2:29:36 PM PST by Thom Pain
[ Post Reply | Private Reply | To 1 | View Replies]

To: massgopguy

The “us” and “them” attitude. I have a friend that is a retired truck driver, union guy, hopelessly Democrat. He needs to supplement his income with a part time job, “anything” he says. I own a motorcycle repair shop and offered for him to come in for a few hours a week to clean the lifts and the floor. He thought about it and declined because he was afraid it would pose too high of a risk to our friendship being my employee, and proceeded to tell me how labor and management can never get along. And he still doesn’t understand why management pulled down bigger checks when the drivers did all the work.


19 posted on 01/15/2014 3:30:06 PM PST by Blue Collar Christian (Vote Democrat. Once you're OK with killing babies the rest is easy. <BCC><)
[ Post Reply | Private Reply | To 13 | View Replies]

To: Thom Pain

You are spot on TP! We all have equal opportunity, it’s what we apply to it.

I could never stand a job where I was offered an hourly wage or a salary. It was very limiting. Until I started my own business, I insisted on commission. When I couldn’t get commission, I started my own business.

Only have to work 1/2 days too: 12+ hours a day that is.


20 posted on 01/15/2014 3:38:36 PM PST by Blue Collar Christian (Vote Democrat. Once you're OK with killing babies the rest is easy. <BCC><)
[ Post Reply | Private Reply | To 18 | View Replies]

To: Kaslin

I invented a card game some years ago I call Democrat Hold’em. First all the players are dealt two cards. Then all women and minorities are dealt an extra card, to make up for past discrimination. Next, those player who received bad cards can complain to the dealer and show them their cards. Those that the dealer judges have received unfair cards get another one. The play continues to showdown. Rather than turn your card over, the dealer looks at each person’s hand, and distributes half the pot to several players according to who he decides deserves to win. The house keeps the other half. Players then tip the dealer to ensure they get a part of the next pot. When players cash out, the house takes another 45% of the players winnings.

Democrat Hold’em tournaments play the same, except everyone gets a trophy.


21 posted on 01/15/2014 3:44:37 PM PST by Hugin
[ Post Reply | Private Reply | To 1 | View Replies]

To: marron
With your help I extract 10 bucks from your buddy. So now you have 20

Big Pig takes a 50% cut of all money that passes through their hooves. That's why this keeps coming up. That money is mostly wasted, and the nation becomes less wealthy. Building wealth is hard work. Destroying it and living off the cut is easy and fun.

22 posted on 01/15/2014 5:07:32 PM PST by Reeses
[ Post Reply | Private Reply | To 2 | View Replies]

To: Reeses
Big Pig takes a 50% cut of all money that passes through their hooves.

Good point. Good trick. So he keeps the poor guy mad at the rich guy while he's got his hand in both their pockets.

23 posted on 01/15/2014 5:22:41 PM PST by marron
[ Post Reply | Private Reply | To 22 | View Replies]

To: Kaslin
Um.... What about outgo inequality?

Like how much goes out (wrote the Treasury another five figure check today) to support all this nonsense?

How about we rank people by how much they pay and see where those chips fall?

24 posted on 01/15/2014 5:41:07 PM PST by Smokin' Joe (How often God must weep at humans' folly. Stand fast. God knows what He is doing.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Kaslin

25 posted on 01/16/2014 5:09:06 AM PST by Lazamataz (Early 2009 to 7/21/2013 - RIP my little girl Cathy. You were the best cat ever. You will be missed.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Lazamataz

That one’s brilliant, FRiend.


26 posted on 01/16/2014 5:09:52 AM PST by sauropod (Fat Bottomed Girl: "What difference, at this point, does it make?")
[ Post Reply | Private Reply | To 25 | View Replies]

To: sauropod

Pass it all around my friend. :)


27 posted on 01/16/2014 5:10:28 AM PST by Lazamataz (Early 2009 to 7/21/2013 - RIP my little girl Cathy. You were the best cat ever. You will be missed.)
[ Post Reply | Private Reply | To 26 | View Replies]

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson