Wednesday, July 15, 2015

Inequality Fallacies

My op-ed on economic inequality is up at the Daily Caller. Some snippets:

Fallacies abound about economic inequality, but one of the worst is confusing income categories with human beings.
Presidential candidate Bernie Sanders recently perpetrated this confusion: 
“Our economic goals have to be redistributing a significant amount of [wealth] back from the top 1 percent … Unchecked growth – especially when 99 percent of all new income goes to the top 1 percent – is absurd,” he fulminated. 
But the “top one percent” and the “bottom 99 percent” are statistical categories — not living and breathing human beings. Confusing the one with the other encourages fallacious thinking.
The late economist Joseph Schumpeter compared income groups to hotel rooms: Just as the former ranges from high to low, so the latter ranges from high-end to low-end. But the different categories fail to reflect who occupies them and whether occupants move to higher categories over time.

Read the rest here.

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