So-called income inequality

This weekend I read an article in the AJC about so-called income inequality.

It had the typical AJC slant. For example:

• Is the middle class no longer being left behind?

In Georgia, the answer to those questions up to now has been no, according to data released earlier this year by the U.S. census.

While the typical Georgia family’s income hasn’t grown so far this decade, after accounting for inflation, the well-off got better-off.

The number of Georgia households making more than $200,000 a year jumped more than 70 percent between 2000 and 2007, while the number of households making less than $75,000 stayed relatively stagnant. Some of that trend was the result of wage inflation, since the income brackets were not adjusted for inflation since 2000.

That sure looks to me like like something got better! More and more Georgian households are earning more than $200k. Isn't that upward mobility? It doesn't say that those earning more than $200k made even more and everyone else lost. It says *more* are getting richer, and those who aren't getting richer are about the same.

It goes on in much the same vein for awhile, then reaches what the author presents almost as a snide toss-off comment:

Experts cite differing reasons for the growing gap, partly depending on where they fit on the political spectrum.

Republicans tend to call it a natural consequence of free markets and innovation, such as advances in technology, which drives up the incomes of some but also displaces other industries and workers.

This make sense to me, but I guess I'm on that end of the political spectrum the author is discounting. It is certainly a truism that, except for professional athletes and supermodels, those who make their living with their brains will earn more than those who make their living with their bodies. Remember, farriers and buggy-whip makers were in displaced industries.

I remember fairly recently a plant in metro-ATL was closed and some 300-400 workers lost their jobs. There was a sob story in the paper that highlighted the 27-year worker who cried "I don't know what I'm going to do now. This is all I know." (Something like that). This plant made cassette tapes. I wondered strongly at the time how many of those people honestly expected that the demand for cassette tapes would remain high enough to keep them employed? I wondered how many of them had CDs and digital answering machines? CDs were introduced in the 80's so they had something close to 20 years to contemplate the potential for cassette tapes to loose their luster, just like they surpssaed their vinyl bretheren (who surely faced similar problems). In fact, cassette tapes sales surpassed vinyl LP sales in 1982, and CD sales surpassed vinyl LP sales in 1988, and CDs surpassed cassettes in 1992.

Back to the article, and this is the most telling paragraph, the toss-off:

Others argue that the gap has been growing because the affluent have benefited from Bush administration tax breaks. Meanwhile, middle-class and poor Americans have seen their incomes fall behind the wealthy as employers cut health and pension benefits, and the government trims spending on education, health care and child care.

Reading this another way: "When the government allowed some people to keep more of what they earned, they got richer. Those who depend on the government got poorer when the government cut back." Typical.