"Reducing income inequality not so easily dismissed"

[applegrove]

Reducing income inequality not so easily dismissed

at the Arizona Daily Star

http://azstarnet.com/news/opinion/column/reducing-income-inequality-not-so-easily-dismissed/article_c4859d99-9aff-5e48-976d-b1ee8000e05c.html

"SNIP..................................



But now a phalanx of economists — and not just the usual suspects from the liberal think tanks — have examined the data and agreed that the growing gap between the richest Americans and the middle class is holding back the economy. Some in fact see such inequality as the main reason for the continuing stagnation in the job market. The richest households don’t spend in aggregate their outsized pay and stock market gains the way the middle class and poor do.

But when the pay base is stagnant or shrinking, consumer spending, which drives the U.S. economy, goes down. Employers hold back on hiring and retain earnings because of the uncertainty over spending capacity of the middle class, which only reduces pay and spending further.

A growing pay gap wouldn’t be so bad if it were temporary, but the trend dates back 20 years: Average income for the wealthiest 5 percent is up 17 percent but up only 5 percent for the middle 20 percent. Translated into current dollars, it takes about $53,000 a year for a family a four in Coconino with a preschooler to be financially self-sufficient — that is, not needing government aid or incurring unreasonable household debt to survive. Yet 28 percent of all county residents live below the poverty line ($26,400 for a family of four) and 44 percent of all Flagstaff schoolchildren are enrolled in the free and reduced-price school lunch program based on income.

As Henry Ford noted, if business owners don’t pay their workers enough, who will buy their products?



..................................SNIP"

[Thinkingabout]

1. This should be apparent but then the lower wgae people do not have the money to buy

Members of Congress. If we could get the low wage earners to stop voting against their best interest and let their Congressional members they will be voting against those who do not push and vote for
increases in minimal wages. The GOP says they can not hurt the job creators, higher wages for the lower incomes spend their extra money to replace worn out appliances, autos, etc and the demand on goods increase the need to hire more workers. Buying stocks does not increase the needs of goods.
Families of CEO's etc do not purchase enough goods to get the economy going. We tried the trickle down method, did not work, let's go back and do things the Democrat way.

[applegrove]

2. I think that is why the GOP hate Obamacare so much....because it will get people

to vote their economic interests all over the country.

[Thinkingabout]

8. Interesting through Obamacare many many people of needs, to get health insurance should

weigh the opportunity of getting health care for them and their families but vote on the RW nuts who is leading this country to ruins because of their policies.

[nadinbrzezinski]

3. Breaking out of the usual places

[winter is coming]

4. Income inequality is going to be *the* issue this year.

I expect the GOP will try to drum up some distraction topics, but I think the genie's out of the bottle on this one.

[Shandris]

5. I wonder what made them come out this year...

...as the data has been available for quite a while (hasn't it?).

Still, it's good to see. Anything is better than never.

[SleeplessinSoCal]

6. Important to keep on the front burner.

[Spitfire of ATJ]

7. "but the trend dates back 20 years"

No. It dates back about 35 years.

When we reduced the taxes on the 1% from 70% to 50% and then down from there.

It is now UNTHINKABLE in the Beltway to even CONSIDER raising them to half, much less more than half because that's "punishing success".