The World Contains Multiple Gaps

The World Contains Multiple Gaps

The World Contains Multiple Gaps

Moneybox
A blog about business and economics.
Jan. 31 2012 1:39 PM

The World Contains Multiple Gaps

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I find it frustrating how many political pundits seem to fundamentally object to the idea that it's possible for multiple separate things to be true and important simultaneously. David Brooks' latest column, with this weird dismissal of people concerned about skyrocketing inequality, is a prime example:

Democrats claim America is threatened by the financial elite, who hog society’s resources. But that’s a distraction. The real social gap is between the top 20 percent and the lower 30 percent. The liberal members of the upper tribe latch onto this top 1 percent narrative because it excuses them from the central role they themselves are playing in driving inequality and unfairness.
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Is it a "distraction" that liberals "latch onto" as part of a strategy of evasion, or have they been reading Congressional Budget Office reports on trends in American income? It turns out that if what you're interested in is income gains over the past generation, the real gap is indeed between the top 1 percent and the rest. If you're dependent on social services, or if you live in a large metropolitan area where rich people also live, or if you work as a social services provider, then this financial accumulation is likely to weigh very heavily on your mind. And that, of course, is exactly who many Democrats are. I think it's laudable to try to persuade people that there are other important kinds of issues and inequities in America than this particular one. But it's by no means a distraction. If the bottom 80 percent want to know why their share of national income has declined, the answer isn't "it went to the top 20 percent," it's "it went to the top 1 percent." There's more to life than money, but sometimes money is a very important topic. And when it comes to money, the top 1 percent is the story.

The story about social cleavages between, roughly, college graduates and the rest is also interesting and important. I would also add that such old-school matters as intense deprivation at the bottom end are also important. The gap between the median American and the homeless people you see on the streets of Washington is not a vote-getting issue, but it matters too. Yet these things all matter separately. A very large share of the returns to economic growth are going to a very small share of the population. We can choose to respond to that with policy, or we can choose not to. But people who want to defend the status quo should defend it on the merits, not dismiss it as a distraction.