Look deeper to find the real cost of attempting to reduce income inequality

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Since time immemorial, man has been led to confirm, perhaps arguably, and reconfirm the overwhelming importance of incentives and rewards in the mere survival, if not growth, of civilization.

Even some idealists acknowledge the key role of incentive/rewards in economic development. Now President Obama informs us that the incentive/reward structure plays little, if any, role in the development process (should you build a useful product, some mysterious other person actually built it).

INEQUALITY OF INCOME is again under severe attack, spearheaded by Obama and his dutiful followers, the media, academia and entertainment sectors. Study after study is cited purporting to show increasing inequality. While this sudden renewed interest in inequality is motivated to some degree, if not wholly, to divert the public’s attention from the HealthCare.gov debacle, the media treatment of the subject is so misleading that it merits greater discussion.

There are myriad ways to measure income inequality. A simple measure identifies income, say $1 million, which separates those with incomes below $1 million from those above $1 million. Suppose the percentage of income earners above $1 million is 1 percent. Do the same calculation for next year and find, say that the income that separates the top 1 percent from others now has jumped to $1.1 million. Then income inequality is said to have increased.

The most recent U.S. data (expressed in nominal not real terms), comparing 2011 incomes to 2012 incomes, show an increase in inequality. Other inequality measures, including the most sophisticated, give similar findings.

These measures, however, suffer from severe weaknesses. One is that most of them use an income definition that includes taxes paid and excludes transfer payments (e.g., Obamacare subsidies, food stamps.) Since taxes have increased so much lately, this produces an upward bias to the study results. Most studies used incomes that were unadjusted for inflation.

The most fatal flaw is that people who are in a given income class or bracket in one year are not necessarily the ones inhabiting that class next year. This churning of income recipients from one class to another is masked by these measures; thus, they easily can provide misleading results: increases, or decreases, in inequality when no changes actually take place.

TO HELP REMEDY this flaw, the U.S. Treasury has conducted a study (because it has access to confidential data) in which a sample of incomes is observed over an extended period of time – 20 years. Naturally, much movement of income recipients among classes is bound to be observed. Remember that when a sample of observations is arrayed by order of magnitude, any one-fifth of the sample is, by definition, a quintile.

If so, then the U.S. Treasury reports that in the decades 1987-1996 and 1996-2005 considerable income mobility of incomes took place. Moreover, roughly half of those in the bottom quintile in 1996 had moved to a higher quintile by 2005. Just as important is that “the median (that value such that half of the observations are above it, and half are below) of those in the lowest income groups increased more in percentage terms than did median incomes of those in higher income groups.”

WE CAN CONCLUDE that during periods of robust growth in the economy, such as the 1980s and 1990s, most citizens enjoy significant growth in incomes. In contrast, during slow times opportunities for income growth, not unsurprisingly, are diminished. Further, as noted by Robert E. Grady (The Wall Street Journal, Dec. 23), the interval from 1982 to 2007, a period of robust growth, median family real income (inflation adjusted income) responded by improving 21.6 percent, on average, over all incomes. After 2007, however, as we all know incomes suffered declines across all quintiles. But overall, however, we know that real income does increase over all income classes.

The notion that the rich get richer because they somehow take what rightfully belongs to the poor is the most pervasive of all false notions about inequality. We all tend, on average, to be paid in accordance with our productivity. The view that what someone receives is at the cost of someone losing assumes that economic activity is a “zero-sum” game, which is patently false.

The remarkable U.S. achievement over the past half-century is that these results occurred despite a steeply progressive tax system, an overly aggressive regulatory system and an undisciplined educational system that has lost its will to teach children how to think with care and rigor. We have forgotten that it is the incentive/reward process (IRP) that drives the economy.

Indeed, the key to our long-run enviable success, our growth and even our short-run successes lies within a framework of personal freedom – freedom to choose, freedom to own private property, freedom to contract – where we allow the IRP to flourish. This encourages incentives to work, to save, and to satisfy community demands. It allows for freely contracted production of goods and services; through innovations, the application of organizational skills and leadership; and the assumption of investment risks.

BUT THESE TALENTS are brought forth by a social organization that allows sufficient rewards to risk-takers. This whole alignment we have labeled the IRP.

Critics of the process point mainly, if not exclusively, to the need to have wealth and income-transfer programs to soften the inequalities of rewards that emerge from applying IRP. But eliminating those rewards is a fatal blow to the incentives that generate growth in GDP, in our overall standard of living, and in employment.

We just aren’t clever enough.

While difficult to understand, and virtually impossible for many to accept, our social organization represents a tremendous achievement that few economists appreciate. It also is difficult for people to understand that mankind currently lacks the analytical tools – the cleverness, if you will – for achieving the goals of critics wanting reductions in inequalities without sacrificing growth in income and innovations, personal freedom and the dynamism that personal freedom, like fresh air, brings.

BUT NEVERTHELESS, many show no lack of hubris in attempting to achieve these objectives: They remain hard at work striving to show that these goals are attainable. In the misty distant future they may have some success.

But this dim prospect does not justify current massive and costly redistributive efforts. In sum, we lack the ability to attain these objectives without incurring the great risk of throwing further disabling monkey wrenches into the social process, including the IRP.

Like early alchemists in search of the formula for gold, liberals seek to feed the world from a flower pot through the magic of taxes and regulations. We are simply not that clever.

(The writer is a professor emeritus of financial economics at the University of Georgia. He lives in Aiken, S.C.)

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specsta
6355
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specsta 01/26/14 - 03:58 am
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A History Lesson

William Beranek wrote: "The notion that the rich get richer because they somehow take what rightfully belongs to the poor is the most pervasive of all false notions about inequality."

Perhaps a quick look at the history of America will correct the inaccuracy of that statement.

Europeans came to America and stole the land and committed genocide against Native Americans. Atrocities committed against other human beings due to greed.

American settlers profited from the poorest of the poor - slave labor - and built enterprises based on no payment of wages to the poor workers, held in chains, beaten ruthlessly and women raped without recourse.

US companies practiced (and continue to practice) racism against black workers, paying them a pittance of a wage compared to their white counterparts.

The justice system penalizes the poor - for being poor - with incarceration, fines and for-profit prisons and for-profit probation - thereby creating an endless cycle of oversight by a corrupt system that forgives the rich and condemns the poor.

The only way for the rich to get richer is to take advantage of the poor. Slave labor, slave wages, control by fear and intimidation (they might pay me scraps, but I can't lose this job), and control of the courts (have any CEO's been arrested lately?) - this is the hallmark of the greedy rich.

The most atrocious part of that equation is for the rich to blame the poor for their own sorry lot in life, all the while chuckling on the way to the bank, thanks to the labor of workers who are paid $8 an hour versus their $48,000 per hour.

The greed in America is disgusting beyond belief.

Bodhisattva
5947
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Bodhisattva 01/26/14 - 09:36 am
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Mr. Beranek tries his right wing propaganda again

Mr. Beranek, obviously a disciple of the late Milton Friedman (A name I can't print who had a nasty habit of pushing the CIA to overthrow freely elected leaders who had nationalized industries in their countries where the people benefitted from the industry and their resources and then have the US install a puppet dictator and sell the nations' industries at fire sal prices to US corporations so giant profits could ensue. Empoverish millions so a few could make millions.) and the Chicago boys, again spins a fanciful tale full of sunshine, lollipops, and rainbows. Yep, that good old IRP. The incentive/reward process. I don't see anyone's incentives going down, but I sure do see their rewards leveling off and staying there. Good job of cherry picking data from Murdoch's WSJ, by Robert E. Grady, Chris Christie's economic guy (getting a plug in for him for 2016?) and former Bush admin official, venture capitalist Cheyene Capital and the ever loved Carlyle Group. You left off, "The degree of mobility is unchanged from the prior decade (1987-1996). I'm sure it was an oversight. I'm sure it was handy picking research written right before the recession as well. You like to give some numbers, but why not mention how much these people's income changed? They changed quintiles? Were they $20 from the next quintile, or were the $2,000 from the next quintile? You give us stats that are meaningless. How about these? Since you like quintiles and using 2007 as a cutoff: From 1979-2007 the bottom quintil after tax income went up 16%. The middle quintile went up 25%. The top quintile went up 95%. The top 1% went up 281%. From 2009-2012, 95% of the income growth went to the top 1%. This shows who's getting the rewards. Strange that it seems that it's come as the right wing has destroyed unions and workers' freedom to band together to contract. Workers haven't lost their willingness to work. Productivity has almost doubled so the average worker is doing the work of two for less than what one should be earning. Look at the figures above and it's pretty easy to see where the redistribution is going. Milton Friedman at his best, which means truoble for everyone except those at the top. All that means is the camel keeps gets getting larger and the eye of the needle keeps getting smaller. Think about that when you write the next editorial making excuses for gutting programs for the poor and giving more to those that aready have it all. Let them eat cake. Right, Mr. Beranek?

Riverman1
81974
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Riverman1 01/26/14 - 09:47 am
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Greed

Greed is simply a pejorative word for self-interest. Rich, poor and those in between look out for their self-interests. Believing the poor are not greedy is not an accurate assumption. Look at how they vote their self-interests.

As far as Americans taking from the Indians, over the entire world as civilization met primitive peoples of all kinds, the civilized subjugated the primitive. Nothing unique about America in that respect. Our justice system may not be perfect, but in this world of nations and various governments, ours has proved to be the best for protecting the rights of all, no matter the wealth. Because the wealthy and others believe the poor are responsible for their condition is not being mean, it’s simply being realistic. Everyone IS responsible for his life.

America is a generous country giving more to the poor than ever before in the history of the world. Our poor are obese. Catastrophes over the world are met with American aid. In addition, the greatness and economic power of America directly caused the fall of two of the most evils empire in history, Nazi Germany and The Soviet Union. Capitalism and looking out for one's self-interests means freedom and the power to keep the authoritarian, murdering tyrants in check.

ymnbde
9544
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ymnbde 01/26/14 - 09:55 am
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3
a reality lesson

our rich pay almost all our taxes
our poor pay less than none
our rich give, from their labor and risk, food to the poor
our rich give, from their toil and time, education to the poor
our rich give, from their charity and conscience, housing to the poor
the reality lesson is simple
our rich give to our poor
our government exploits the poor
our government perpetuates our poor for the benefit of our government
our democrats keep blacks in perpetual bondage by not educating them
and giving them the same school choice as the rich (it's the civil rights issue of our time, ignored to our peril)
but democrats don't say anything about the education gap
from which all, all, all, all... other gaps are made
and people such as the poster above so easily ignore that reality
and stay in the cognitive peasantry so dependent on the government
who exploit ignorance and use myths and fables to create the evil rich
thus to protect the poor from the evil rich
Marx never had a job
Marx lived off the work of others
Marx could only live by exploiting the work of others
and the same are the marxists still, except now they prefer to be known as democrats
exploiting the toil of the rich by using the poor as shield and weapon
for their own profit

teaparty
11313
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teaparty 01/26/14 - 10:40 am
10
4
"US companies practiced (and
Unpublished

"US companies practiced (and continue to practice) racism against black workers, paying them a pittance of a wage compared to their white counterparts."
specsta, that is bunch of bull.

myfather15
53837
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myfather15 01/26/14 - 10:51 am
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Specsta

I'm not gonig to waste my time refuting most of your claims, but I do want to ask one question.

What has Obama and the left done to Change this? What substantial steps have they taken, to take from the rich and give to the poor?

I haven't seen it. The poor people that were poor under Bush, are still poor under Obama!! The ACA is NOT going to do a darn thing for poor people, but eventually it WILL give GOVERNMENT a LOT more power!! If the poor of this Country want to stop being poor, they had better not depend on GOVERNMENT to get them out of it!! The lefts TALKS a good game for the poor, and does NOTHING!!!

They give just as many tax breaks to the rich as the republicans, because they have just as many rich friends as republicans. See, democrats have learned a very important lesson about American politics; as long as you TALK a good game, it really doesn't matter what you actually do!!! You must LIE to the people and tell them you're going to take care of them, whether you actually do or not!! Then they lie and say that republicans want to completely do away with assistance programs!! That is a LIE!! We just want more oversight to stop fraudulent cases!!

But, I agree with you on many of your points about America being ruined by greed!! But I wouldn't limit that only to America, but the ENTIRE WORLD!!! My problem is that you and others use this argument as a political WMD!! Claiming the LEFT has all the answers, when they've done nothing substantial to address the problem. You also use this argument as a bash America tool and that I despise!! This is the greatest Country on earth!! People have more opportunity here than ANYWHERE. Evidence in the fact that people are still doing everything they can to come here!! People are still fleeing here for FREEDOM!!

Every Country has their own history of violence, oppresion and slavery. To imply that America is the only Country with wrongful history is to deny the TRUTH!! But, it's not surprising, coming from people with an agenda to tear down America's foundation and rebuild it in THEIR VISION!!

teaparty
11313
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teaparty 01/26/14 - 10:53 am
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1
"Marx could only live by
Unpublished

"Marx could only live by exploiting the work of others
and the same are the marxists still, except now they prefer to be known as democrats"
well said, the communists in the US in 50s, 60s and the 70s converted a lot black folks to communism and many of them still hold those values. I can understand why many of them did because of the racism that existed then. I wish they would realize that communism DOES NOT WORK.

deestafford
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deestafford 01/26/14 - 11:22 am
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4
Once again an excellent column which unfortunately...

Once again an excellent column which unfortunately goes completely over the head of the Marxist left as indicated by the first two commenters. Logic and reason too often are never applied by the left---only feelings and a tendency to misconstrue history.

As a result of what the Founders put in motion, Americans have buitlt a country in which more liberty and prosperity are more widely shared among its citizens than any other people in human history.

Those nations which have put liberty ahead of equality have ended up doing better by equality than those with the reverse priority. Conservatives and the Republican party are on the side of liberty and the Democratic party is on the side of wealth distribution.

The inequality gap makes the assumption that it is a violation of some type of social justice. The concept of social justice rules out or minimizes the role played by talent, character, ambition, injustice, daring, work, and spirit in producing unequal outcomes in the "pursuit of happiness". The concept of social justice runs counter to the American gain.

The term "poor" in America is a relative term and is not absolute. "Poor" in America would be considered rich in parts of Europe and many other parts of the world. As the column points out so well we have a dynamic labor market in which people can and do continually move from one income quintile to another throughout their careers and lives. Many in the top 1% will fall to the middle class or lower and many in the lowest quintile will rise to middle class and higher. This is not possible in the European Union or other parts of the world.

The problem with liberals is they concentrate on the relative little that is wrong with America instead of the enormous good. They seek to destroy or minimize the traditions and institutions that started the American Revolution and made it possible for more freedom and prosperity by American citizens than any other country or society in the history of the planet.

carcraft
25142
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carcraft 01/26/14 - 11:32 am
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1
This week I read a great

This week I read a great article about a young man named Jamail Larkins. One of Forbes under 30. Owner of Larkins enterprises, one of the youngest pilots in America. Started his first business in high school. Oh he is Black!!! Now Mr. Larkins has passion, energy, drive and loves aviation. See the Augusta Chronicle story on Mr. Larkins, page 7 section C Thursday Jan 23,2014.) Oh yes the deck is stacked against some one being black. I watch Shark Tank every week. Fellow there named Damon Johns. He seems to have done quit well. To stay out of poverty, graduate from high school, and get married before you have children. You can blame your failures on race or step up and take control of the circumstances of your life!

historylover
6678
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historylover 01/26/14 - 11:36 am
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The term "poor"

It is so very apparent that most of the above posters have never been POOR. I get so very sick and tired of people sitting in their warm, comfortable homes, writing comments about those who do not share the same. Our country has become one of polar opposites where people like us sit at our computers judging the rest of the country with our words. it sickens me. None of this man's comments went over this Liberal's head. I understood and disagreed.

carcraft
25142
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carcraft 01/26/14 - 11:50 am
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2
I have been poor. I would

I have been poor. I would drive my car till I ran out of gas and park it by the side of the road praying it didn't get towed before I could come up with the money to get gas. I used to throw pocket change in the ash tray. That was my cash reserve which ussually got spent to tide me over to the next pay check. When my car broke down I 'd cage rides etc from freinds until I could get the fuel pump, axle bearing etc replaced.

carcraft
25142
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carcraft 01/26/14 - 12:01 pm
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Used to be a saying that went

Used to be a saying that went "success has many parents, failure is an orphan "! Thanks to the left being a failure is multi parented "race, social misunderstanding, culture, ethnic differances, victimazation, " long let of parents for those who want to wallow in a pity party!

Common.sense
465
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Common.sense 01/26/14 - 12:12 pm
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2
You want your income to be as

You want your income to be as equal as others? Go to school, learn a trade and get a job. This comes from someone who, by your definition, is poor. I don't want the government to make my income equal to others because I haven't EARNED it.

deestafford
25920
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deestafford 01/26/14 - 12:20 pm
6
3
If poverty in the US is so bad, why...

If poverty in the US is so bad, why are millions of people trying legally and illegally to come here? If you were going to be poor in any country in the world, where would it be--Viet Nam, China, Cuba, The Sudan, Haiti, or the US?

Do we see liberals refusing to work for more than $20 an hour in order to show their solidarity and compassion for the poor workers?

Do liberals generously tip minimum wage workers at restaurants and other service oriented establishments? Various studies show they do not.

Should not there be a massive income inequality between a man with rare skills who works 70 hours a week and an unskilled, low educated, unmotivated, part time worker.

If one really loved the poor, they would stand for, strongly support, and defend the free enterprise system rather than trying try to tear it down as the left is trying to do in the name of "compassion". The free enterprise system has raised the lifestyle of more poor people throughout the world than any economic system in history. Why does the leftist Marxists want to destroy it? Simply because it takes the power away from the "ruling elite"---them. Under a free enterprise system the people run their lives and not the government whose levers are pulled by the "ruling elite".

Have you ever noticed the inverse relationship between the size of government and the size of the middle class? The bigger the government, the smaller the middle class. The smaller the government, the larger the middle class. Liberty, individual responsibility, personal property rights, smaller government, lower taxes, and Conservativism work every time they are tried.

myfather15
53837
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myfather15 01/26/14 - 12:21 pm
7
3
The LEFT in this Country,

The LEFT in this Country, played politics as usual and PURCHASED the minority vote!!

LBJ (leftist democrat and known racist) is often given credited for Civil Rights, because of the bill passed in 1964. So, the minorities often vote democrat because of this!!

The TRUTH, which is NEVER mentioned in mainstream politics is, that Eisenhower (republican) attempted to pass a Civil Rights bill in 1957, which was MORE broad than the bill of 1964!!

But democrats absolutely COULD NOT have a Civil Rights bill passed while a republican was the President!! They could NOT allow republicans to get credit for Civil Rights. They KNEW this would destroy them politically!! So what did LBJ and the other democrats do? They voted AGAINST IT!!

They played POLITICS with people's FREEDOM, yet amazingly, they still get credit for being the Saviors of Civil Rights!! People are just so willingly and blissfully DUMB to the truth!!

itsanotherday1
41708
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itsanotherday1 01/26/14 - 12:22 pm
6
1
Uhhh, no experience at being poor?

Buying school clothes was two pair of jeans and a pair of shoes. They had to last. Substantial portion of food was grown in the garden or shared from a relative's small farm.
No air conditioning
Space heaters
1 bicycle my entire childhood
Toys were rare, any gifts were things of more practicality; like a shirt, socks, or underwear.
Many meals of just a pot of peas or butterbeans along with a pan of cornbread.

No, I don't know poor.

dichotomy
31942
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dichotomy 01/26/14 - 12:28 pm
6
3
Income inequality is mostly

Income inequality is mostly caused by inequality of effort....and the government's willingness to subsidize it. The best motivator to find work is a little hunger and the possibility of being cold and wet. As long as the government provides cradle to grave welfare there will always be severe income inequality.

stuaby
3440
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stuaby 01/26/14 - 12:58 pm
5
2
@historylover

Come on, man.
Why are "poor" people poor?

carcraft
25142
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carcraft 01/26/14 - 01:44 pm
5
2
Funny, people come from

Funny, people come from China, Vietnam, etc. They arrive in America barely speaking English and their children end up on honor rolls and going to the best colleges in America. No, no hope of moving ahead in America unless Obama and the libs make an even playing field!

nocnoc
40980
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nocnoc 01/26/14 - 02:29 pm
4
1
Income Equality requires Mental Equality.

Education leads equality.
The Fed's make College and technical training available to low income citizens. If you sit on your tail as professional and do nothing others want to buy (LEGALLY) you are getting just what your are worth ..... Minimum $$.

Face it,
There are just some people on this earth that if you gave them the same amount $$$$ as everyone else, they would end up losing it to the brighter, smarter group in a matter on months and at the most several years.

Besides name 1 place on earth that has tried Income Equality and the economy was successful, just 1.

nocnoc
40980
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nocnoc 01/26/14 - 02:30 pm
5
1
Bizkit
30515
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Bizkit 01/26/14 - 03:14 pm
3
2
Part of the wealth disparity

Part of the wealth disparity is because of the loss of two income families and so many single parent families. Most 1% are two income families. You can have a PhD and die in poverty and not complete high school and build a lucrative business so obviously "motivation" is a major factor. A recent poll indicated the majority of Americans want equal opportunity and not income equality-without incentive what's the purpose? My wife and I married and chose to get educated and work hard for the promise of success-we dang sure didn't get any help from any of you.

Bodhisattva
5947
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Bodhisattva 01/26/14 - 03:50 pm
2
4
Good old right wing spin and propaganda

Marx held the same job as Michael Ryan and Phil Kent, newspaper editor. With Phil's little "borrowed words" problem, and the Chronicle's history of relying on talking point letters from right wing think tanks you could say that they get by on the work of others. Like Kent, Marx was also an author. There's a slight chance his books might have outsold Kent's as well. Like Mr. Bernanke, he also wrote regular columns for newspapers. Myth busted.
Civil rights in the era of Ike when those racist Democrats blocked the angelic GOP. Well let's think back. That's right after Democrat Strom Thurmond started breaking up the party in the south and formed the Dixiecrats. A while later the, "We've lost the south for a generation." came about as Johnson signed the two signature civil rights bills and all of those racist right wing jackasses, who didn't belong in the Democrat Party anyway, jumped ship and joined the GOP. Then came Nixon and Reagan's southern strategy, Bush l' s Willie Horton, the Tea Party, the brothers, and the rest, as they say, is history. Facts corrected.
Lazy people? That's why there's poverty and so much wealth inequality? CEO' s used to make about 40 times what the average worker made. Now, productivity has almost doubled, staffing is lower, so workers are doing the work of two people. They're not getting paid double, or even 150%%. Real wage growth is a little over 5% since Reagan was elected. The CEO' s? Working about the same as they used to. Compensation? Over 400 times the average worker. Just how can we have such wealth inequality? Finally, total mandatory spending programs for the poor, ie. welfare,food stamps,...... Right at 90% goes to the elderly, disabled, and those who have a job but are paid crap and qualify for assistance. School? Training? I know a kid in this boat. They give him his schedule the day before the week starts. Of course, it's subject to change. Some days it's a split shift. Work 8:00-12:00, then 5:00-1100, oh, and you get to open the next morning so be in at 7:30. No sleep. No time off to speak of. No benefits. Schedule school? Ha! I can't imagine single mom having to go through this. Oh, forgot. A whopping 20¢ over minimum wage. Myth busted and facts corrected.

harley_52
22898
Points
harley_52 01/26/14 - 04:04 pm
3
2
Your Success Or Failure In Life Is....

....largely determined by the choices you make. Make good choices, you'll likely be successful. Make bad ones, you won't. One of parents' most significant responsibilities is to teach their children to make good choices. Children who don't have good parents start of with a significant disadvantage, but good choices will still overcome it.

Breaking up families and paying people money for making bad choices only encourages them to make more bad choices and that's what democrats have done for over four decades.

teaparty
11313
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teaparty 01/26/14 - 04:14 pm
4
2
"No, I don't know
Unpublished

"No, I don't know poor."
itsanotherday1, I know what you mean. If it was not for hand me downs I would not have had any clothes. Luckily I had cousin that was a little bigger than me. We ate what we grew, vegetables & meat. I have killed and cleaned many chickens when I was child. I NEVER HAD money for lunch at school until I started working at 16 and was too ashamed to take a biscuit and a piece of ham. In the fifties my brothers, sisters and I did not start school with the rest of the kids because we had to pick cotton. I remember coming home from school about 4 PM after having breakfast about 6:30 AM and had no lunch at school and the only thing to ear was an egg and a biscuit. I cooked the egg because my mom was working in the field.
"No, I don't know poor."

Bizkit
30515
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Bizkit 01/26/14 - 04:20 pm
4
1
If you have nothing to offer

If you have nothing to offer you get paid crap, but if you have a "skill" then your earning potential goes up. When I taught college, I taught many divorced working mothers or single working women with children who worked all day, went to school in the evening and raised 1-3 children so I don't want to hear any Sad Sack stories about how you can't accomplish this feat-it is common place. I am sure every one of those women are in a better place (without a man) and have improved their lives-even with the sacrifices of getting their education and the added debt. Two very good friends are just high school grads yet both have built successful businesses. One went from dragging ditches and road sweepers to a multimillion dollar tech communications business-ask him if America is a land of opportunity. I doubt a single poster didn't start working in life making minimum wage and then moved up from there. That's the idea-an incentive to improve. You give somebody anything-whether a rich man or poor-it means nothing and flitters away-you work for a dollar and you think twice before spending it. Studies show most millionaires aren't necessarily high income earners but people who live modestly, pay without credit, and build wealth. Few Americans save for retirement-my wife have always done so. I can't help people make poor decisions.

teaparty
11313
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teaparty 01/26/14 - 04:21 pm
4
1
"Breaking up families and
Unpublished

"Breaking up families and paying people money for making bad choices only encourages them to make more bad choices and that's what democrats have done for over four decades."
harley, well said. This is exactly what the Great Society, liberals/progressives, democrats and black leaders have created.
Generation after generation of deadbeats.

teaparty
11313
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teaparty 01/26/14 - 04:34 pm
3
1
"A while later the, "We've
Unpublished

"A while later the, "We've lost the south for a generation." came about as Johnson signed the two signature civil rights bills and all of those racist right wing jackasses"
bod, LBJ was a pure racist and said, “I’ll have those 'N-word' voting Democratic for the next 200 years.”
LBJ also said, "These Negroes, they’re getting pretty uppity these days and that’s a problem for us since they’ve got something now they never had before, the political pull to back up their uppityness. Now we’ve got to do something about this, we’ve got to give them a little something, just enough to quiet them down, not enough to make a difference.”
LBJ knew that the South could not keep blacks down forever and that should the Republicans be successful in pursuing the passage of Civil Rights and Voting Rights, Dems would lose the black vote forever.

Malcolm X said it best, "Democrats have been in Washington, D.C. only because of the Negro vote. They've been down there for years and all the legislation they wanted to bring up they brought up and got it out of the way, and now they bring up you. You put them first and they put you last, cause you are a chump. A political chump." --

burninater
9396
Points
burninater 01/26/14 - 04:37 pm
2
4
The good news is that

The good news is that Beranek's style of rhetorical and statistical manipulation is being presented to a less credulous public than existed a generation ago.

He tries a piece of clever misdirection here, repeating the myth that all concerned with income inequality believe income distribution is a zero-sum game. Nonsense. The real problem is gross disproportionality in the distribution of productivity gains. This stems from multiple causes, not limited to 1) executive compensation that is tied to neither performance nor to freely-determined wage mechanisms; 2) executive culture shift from a sense of ethical responsibility that included employees, company, customers, community, and profit, to the current emphasis on the appearance of short-term quarterly gains (I say appearance, as quarterly "growth" often consists solely of severe cost-cutting and/or accounting structures that pad executive compensation but leave the enterprise worse off in the mid to long term); 3) erosion of the ability of American workers to organize and collectively bargain, and 4) erosion of the ability of American shareholders to hold executive compensation boards accountable.

The lie of Beranek's thesis is revealed by comparing wage growth in other Western industrial economies, such as Germany, Australia, France, the Netherlands, and Denmark, over the last 30 years. Over that period, those nations listed experienced real median wage growth ranging from 64% to 220%. The U.S., on the other hand, experienced real median wage growth of 0.47%. The difference between us and them is they have strong cultural emphases on family and community, leading to real political and regulatory pressure that distribute productivity gains more equitably. The U.S. used to have a similar corporate culture, but it was rejected over the past 35 years in favor of a culture of wealth worship. American executives now are predominantly motivated by the single ethical choice of how to increase personal wealth, to the extent that their hand-picked compensation boards will even reward them for destroying a company's value!

The most surprising aspect of this evolution of American corporate governance to its current sorry, corrupt state is that there are still individuals that hold rhetoric such as Beranek's piece to be more real than the financial behaviors and data that clearly refute it.

carcraft
25142
Points
carcraft 01/26/14 - 05:09 pm
3
1
Read about Johnson at RJ

Read about Johnson at RJ Reynolds, and "Barbarians at The Gate " This is nothing new. I Know, lets have the government take over the companies. Then we can have our corporations ran with all the efficiency of the Government Health care. Web site!

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