Inequality inanity

Jordon Cooper buys some school stuff for the kids and bitches about the old “inequality” myth:

While the cost of zipper binders seems high, the bigger issue is the growing income inequality that many of us are feeling. When adjusted for inflation, incomes have been flat since the late 1970s. We simply aren’t taking home any more money, yet our lives are considerably more expensive.

"... and don't get me started on the cost of ophthalmologists."

“… and don’t get me started on the cost of ophthalmologists.”

Yes, and no. When adjusted for inflation, based on the old consumer price index model, Cooper would have to go a lot further back to find a time when real income wasn’t increasing. It’s been like that since at least the mid-1960s and, barring a revolutionary technological advance, they will continue on that trend for a while.

The reasons behind this stagnation might not jibe with Cooper’s worldview, but I’ll accept his premise.

Cooper’s bigger error is in saying our lives are considerably more expensive. Hardly. Look around you right now — tell me which products you have that are more expensive and/or unreliable than those found in the 1970s, if they actually existed. Think about what you ate for breakfast this morning; in real costs, the price for food has gone down almost invariably, while the variety and quality of foodstuffs has increased vastly. Even amongst the poor, how many of them have TVs (and cable), cars, cellular phones, or microwave ovens? And how many of them would prefer to have those same products or anything else from the 1970s than those from recent years?

Generally, at least.

I’m speaking generally, of course.

Put it this way: if things were really as bad as Cooper believes, how many of those poor people he claims to care about would be absolutely (and rightly) pissed off if the local Wal-Mart shut its doors?

Further, while rents and other costs do go up in boom towns like Saskatoon, so do real wages and increased employment opportunities. Does Cooper really believe that things have gotten worse for most people?

His complaint about the “stagnating minimum wage” would have carried more weight if the bulk of those earning minimum wage were the masses of immigrants shipped to the city because of our shortage in low-skill workers. It’s a bullshit complaint anyway since minimum wage hurts more low-income workers than it helps.


What causes “inequality?” Cooper thinks he knows:

Income inequality is driven largely by market forces. Technology has changed the job market, and globalization has moved markets overseas or driven down wages.

He says this like it’s a bad thing. It’s good that technology changes job markets, driving out inefficient processes. It’s good that there are more markets overseas, so that products and services can be shared to emerging economies. It’s good that wages don’t escalate rapidly, thus keeping prices down for consumers, rich and poor alike.

This, apparently, is a “problem” worth solving:

The problems are well known, but politicians struggle with the solutions. Whenever I ask an elected official what can be done, I get a couple of moments of awkward conversation about education being a big part of the solution to market problems (and something we have to improve in Saskatchewan), but that is it. No one wants to mention the institutional solution, which is to transfer money from the rich to the poor through personal income taxes and social programs.

Countries who have closed the gap on income inequality, such as the Nordic nations, have more generous social safety nets. By distributing the money over a wider population, the economy does better and those at the bottom have better options to be upwardly mobile.

Ah, the old redistribution-is-the-solution-to-social-persecution bag of cards, complete with the ubiquitous Nordic social model. Funny, everyone thinks Sweden’s “social equality” is awesome has but no one wants to talk about the burning cars.

Fortunately, these were likely unionized arsonists.

Fortunately, given Sweden’s labour participation rate, these were likely unionized arsonists.

Meanwhile, Cooper doesn’t explain how “the economy does better” when money is taken from those who produce to those who don’t. How so? And how does taking money from others make one more “upwardly mobile?” We aren’t told.

The whole “inequality” complaint has become more common over the years because the previous social-justice complaint — “poverty” — is becoming more and more scarce. Since 1990, more than a billion people have been lifted out of poverty, not because of redistributionist government intervention but because of insidious “market forces.”

"I'll have some lettuce, tomatoes, and a reduction of class consciousness, please."

“I’ll have some lettuce, tomatoes, and a reduction of class consciousness, please.”

Inequality isn’t the issue, but rather absolute growth in prosperity. Increased comforts, longer life spans, more consumer choice, increased freedoms — these are the measuring sticks that matter.

And the best, most proven way to attain this level of increased prosperity is to allow market forces to do its thing.

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