I’ve been asked how I respond to the issue of widening income inequality raised a couple of days ago by President Obama and discussed here.
I have a number of thoughts about it. Here are a few, hastily assembled (upon my return from the annual ward Christmas breakfast) in no particular order and with absolutely no claim to completeness:
Government tends not to help on this issue. In fact, it often tends to hurt.
1. Federal welfare policy has encouraged dependency, and has subsidized delinquent fatherhood. This has led to a meteoric rise in single-parent families — a fairly reliable predictor of low income — and to the feminization of poverty. And those, in turn, tend to create a new generation of poor and often unemployable children.
2. Moreover, government agencies — which have proliferated in number and intrusiveness — tend to favor large corporations and large unions, the only organizations with the budget resources to systematically cultivate regulatory agencies and legislators and, thus, the organizations most reliably capable of garnering access to and the attention of powerful politicians. It’s no coincidence that six of the nation’s ten richest counties are clustered right around Washington DC, which, before the rise of the behemoth regulatory state, was a small, sleepy Southern town. Many large corporations have moved, or are moving, their headquarters to the greater DC area, because they know where the power is concentrated. (A simple Google search for corporations moving their head offices to the area around Washington in recent years is instructive, if not stunning.) Small businesses tend to lag behind in terms of access to federal authorities; most of them are local, for that matter, and cannot simply move to Maryland or Virginia. Yet it’s in small business that much of American wealth is created and where economic recoveries typically begin. That’s why it’s such bad news that small-business regulations have surged under President Obama even while the rate of small-business formation fell to record lows. Although there has been some improvement lately in that rate — people and businesses adapt; they have little choice — the launch of Obamacare (with its difficult registration, its unpredictable consequences, its ever more whimsical enforcement, and its increased costs) may jeopardize those gains and could make the situation much worse.
3. American public education is often mediocre, and it’s especially bad in poor areas. It underserves disadvantaged people to the point of malfeasance. (See here, for instance.) Even graduates of our schools often find it difficult to compete, nationally and internationally.
4. Drug policies have permitted, and perhaps fostered, widespread addiction, which often renders its victims essentially incapable of productive employment.
Having hastily written the above, I’ve also located some interesting and relevant links, with either reinforce what I’ve written above or, in some cases, go beyond it. Here are two of them, chosen essentially at random from a vast pool:
And here’s a bracingly partisan take on the matter, with which I fully agree.