June 29th, 2022


I Dream of Gini: Refuting one of the Left's favorite fetishes

Deroy Murdock

By Deroy Murdock

Published Oct. 11, 2019

President Donald J. Trump's fiercest critics claim that the gap between the haves and have-nots is expanding on his watch.

"Is it getting hot in here, or just the elevating public consciousness around rampant wealth inequality?" Representative Alexandria Ocasio-Cortez (D –New York) asked via Twitter earlier this year.

Senator Elizabeth Warren (D Massachusetts) said: "When you've got a government, when you've got an economy that does great for those with money and isn't doing great for everyone else, that is corruption, pure and simple."

AOC and Warren are right, up to a point: Income inequality, indeed, has grown on President Trump's watch.

The key metric here is called the Gini coefficient. A 0.00 score represents perfect income equality; 1.00 represents perfect income inequality.

Under President Trump, America's Gini coefficient ticked up, according to the latest data, from 0.48 in 2017 to 0.49 in 2018.

But the Gini did not stay in its bottle under Obama. During his presidency, Gini also edged higher — from 0.47 to 0.48, in 2011. It then stalled, past his departure. So, despite his blather about income gaps, the "evil" 1 percent, and his "You didn't build that!" gut punch to America's entrepreneurial class, Obama did absolutely nothing to reduce income inequality.

The gold medal for income inequality goes to Washington, D.C., the pounding heart of Big Government statism. Its 2018 Gini score was 0.53. Leftist New York (0.52) — "the state with the greatest gap between rich and poor," as Statista's Erin Duffin described it — wins the silver. And the bronze belongs to liberal stronghold Massachusetts (0.49).

If you seek income equality, in contrast, go West! Nebraska — Forbes' fifth-best state for business — scores the Gini bronze (0.44). Right-leaning Wyoming takes the silver (0.43). And small-government, conservative, individualistic Alaska and Utah share the income-equality gold medal (0.42).

So, for the 500th time, Leftists like New York's AOC and Massachusetts' Warren should clean their own sandboxes before they bark orders at everyone else.

No matter how you slice it, the Left's quixotic quest for income equality puts zero bread on anyone's table. What actually feeds people is larger paychecks. And, here again, Trumponomics trumps Obamanomics.

Median household income has climbed to an all-time record. As veteran free-marketeer Stephen Moore explained in the Wall Street Journal:

"Real median household income — the amount earned by those in the very middle — hit $65,084 (in 2019 dollars) for the 12 months ending in July. That's the highest level ever and a gain of $4,144, or 6.8 percent since Mr. Trump took office. By comparison, during 7½ years under President Obama — starting from the end of the recession in June 2009 through January 2017 — the median household income rose by only about $1,000." That precise figure is $1,043, or a mere 1.7 percent.

This metric's performance was downright self-humiliating under über-RINO G.W. Bush. Across all eight years of his "compassionate conservatism," median households saw their winnings creep up a paltry $401, or 0.7 percent.

Income inequality also focuses on the wrong thing. It's like a patient who is rushed into the hospital with a heart attack and then stunned when the emergency-room doctors X-ray his leg. The focus, instead, should be on what really counts: absolute, rather than relative, incomes.

Consider two job proposals:

Acme, Inc. offers you $50,000, but your boss makes $55,000. Income inequality equals 10 percent.

Zenith Corporation, meanwhile, would pay you $500,000, but your boss makes $1 million. Income inequality equals 100 percent.

Anyone with two brain cells to rub together, would go work for Zenith, despite the 10-fold-higher level of income inequality. This simple illustration demonstrates that income inequality is, at best, yet another bogus, Left-wing distraction. At worst, this fetish weaponizes envy into ruinous public policy.

The Left should grow up, dump their income-inequality pacifiers, and work with the Right to boost the absolute wealth of the poor, the middle class, and the rich — to heights yet unseen.

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