From National Review and Michael Tanner, The Democrats’ Class Warfare
And now we have a new study from the Brookings Institution. Yes, the liberal Brookings Institution. Authored by former Obama economic adviser Peter Orszag and others, the study concludes that even raising the top individual-income-tax rate to 50 percent from its current 39.6 percent and redistributing all the new revenue to those with incomes in the lowest 20 percent would do surprisingly little to reduce inequality. Hillary, Bernie, et al. could tax the rich as much as they want and pour the money into welfare programs, but that still wouldn’t do more than dent inequality.
The Left also believes that most rich people don’t earn their wealth, they inherit it, resulting in a new aristocracy. That was the central thesis of Thomas Piketty’s oft-cited book, Capital in the Twenty-First Century. In reality, however, roughly 80 percent of American millionaires are the first generation of their families to have that much money. Most of the rich are entrepreneurs who earned their wealth through hard work.
In a similar vein, researchers led by Jae Song of the Social Security Administration found little evidence that inequality is caused by a growing wage gap between corporate executives and other workers. Instead, nearly all the growth in inequality from 1978 to 2012 resulted from disparities in wages between companies. Similar jobs at different companies pay different wages. Duh! And workers sometimes choose other compensation or benefits or conveniences instead of higher wages. Therefore, traditional liberal proposals such as capping CEO pay would have little impact on inequality.
And if that’s not enough to spoil the inequality story, there is also a new report on poverty from the World Bank. Critics of inequality would have us believe that rising inequality is responsible for poverty. But at a time of increasing inequality, world poverty has never been lower. The researchers project that fewer than 10 percent of the world’s population will live in extreme poverty this year.
Read more at: http://www.nationalreview.com/article/425850/democratic-debate-income-inequality