[Posted by Karl]
A new poll from The Hill has two-thirds of likely voters saying the American middle class is shrinking, and 55% believing income inequality has become a big problem for the country, so it’s worth a quick update on the latest critiques from left and right.
James Pethokoukis briefly responds to a Columbia Journalism Review blog attack from Ryan Chittum. It’s a restrained response, given the tendentious cherry-picking in the Chittum piece. Unsurprisingly, Paul Krugman loved the Chittum piece, again working the Godwin-ning meme that anyone disagreeing with the lefty line on the issue is a “denier.” Indeed, Pethokoukis has recently agreed that income inequality has increased somewhat in recent decades, which of course would be proof to Krugman of just how devious the deniers are. All that’s going on here is that lefties want to conflate debate over whether income equality is exploding, or a danger to democracy, or proof the rich have been exploiting the poor for decades, with a denial of the existence income inequality itself. It’s a strawman, but sporting a top hat and monocle.
Incidentally, Census Bureau data suggests income inequality has been flat since 1994. If I was as tendentious as Chittum or Krugman, I would note the emergence of Republican Congresses during this period, although it’s likely there were larger forces at work.
Meanwhile, at National Review, Robert VerBruggen either doesn’t understand or isn’t convinced by some of the arguments from the right regarding income mobility and inequality (I would advise him to watch or read the recent PBS interview with Richard Epstein or this Will Willkinson paper to get a better understanding of the inequality issue). VerBruggen’s primary objection is based on the example of someone becoming richer during their lifetime, which according to VerBruggen, is “not the kind of income mobility we mean when we talk about the American Dream (which might be more accurately called class mobility).” However, I doubt he would want to live in an America without the example he describes.
Moreover, it seems that the concept of the American Dream VerBruggen describes is one of intergenerational income mobility. On this point, by one measure, the rate at which people move to income quintiles that are different that that of their families of origin is roughly 60% — slightly less than in the 1960s, the era progressives celebrate as a period of greater income equality overall. By another measure, data from the Pew Economic Mobility Project show that, adjusting for the smaller size of today’s households, four fifths of Americans have surpassed their parents. Could we be doing even better on that score? Although studies showing European countries doing better are open to dispute, America arguably could be doing better. As the Brookings Institution’s Ron Haskins put it in 2009:
Poverty in America is a function of culture and behavior at least as much as of entrenched injustice, and economic mobility calls not for wealth-transfer programs but for efforts that support and uphold the cultural institutions that have always enabled prosperity: education, work, marriage, and responsible child-rearing.
Thus, the inequality debate is not nearly as relevant to the more important question of mobility as it sometimes seems to many advocates and politicians. Inequality is a cloudy lens through which to understand the problems of poverty and mobility, and it does not point toward solutions. Great wealth is not a social problem; great poverty is. And great wealth neither causes poverty nor can readily alleviate it. Only by properly targeting poverty, and by understanding its social, cultural, and moral dimensions, can well-intentioned policymakers hope to make a dent in American poverty — and thereby advance mobility and sustain the American Dream.
Haskins excepted, changing the culture and behavior of poverty, however, is not something that interests most lefties. It’s much easier — and much more comforting — to demonize “the rich.”