If one was to believe the rhetoric, President George Bush's economic policies unleashed a recession of unprecedented magnitude that led not only to long-term unemployment at historically high levels but also increased the gap demarcating the "haves" (the rich) from the "have nots" (the poor).
The problem with this rhetoric is that it is based upon the most recent data that intentionally excludes historical trend analysis. In plain English, the statement is based upon fact but neglects the facts.
Historically, living standards have improved for both the poor and middle class even as income inequality has grown. Think "a rising tide lifts all boats," meaning that rising income inequality has not increased inequality of opportunity. In fact, Winship writes, the evidence of a link between the income inequality and inequality of opportunity is extremely weak.
Consider these facts based in history:
- During the early 1980s (read: President Reagan), income inequality within the bottom 80% of households grew modestly. That's the "evil" Ronaldus Magnus oftentimes touted in the rhetoric. Since then (read: President Reagan's second term and the terms of Presidents George Herbert Walker Bush, Clinton, and George W. Bush), earnings and income inequality between the poor and middle classes have not risen.
- Neither has intergenerational mobility declined much--if at all--since 1980. No research demonstrates a significant increase in intergenerational mobility since the 1950s. Winship's research indicates that today's 30 year olds experience no less intergenerational mobility than did 30 year olds in the mid-1970s.
The "take away"?
Upward mobility has not diminished during the past three decades due to rising income inequality. That said, upward mobility has not risen during those decades. Should this pattern continue, 70% of poor children in 2014 will not make it into the middle class as adults and 4 in 10 will poor in their 40s.
That is unacceptable, something about which all of the nation's leaders--liberals, conservatives, or libertarians as well as Democrats, Republicans, or Independents--should be gravely concerned. For Winship, the challenge confronting the nation's leaders is to identify real solutions for the problem which is not income inequality but limited upward mobility.
Put a little more curtly, it's time to dump the fanciful rhetoric stressing "income inequality" and stress instead "economic immobility." At least this rhetoric would be rooted in the facts established by historical research.
Let the discussion begin...
To read Scott Winship's analysis, click on the following link:
"Why We Should Wage a War on Immobility Instead of Inequality."