Income Inequality: The Inconvenient Truth II

Don't miss Mark Thoma's latest installment in the debate about income inequality over at Cato Unbound. I think Mark makes a particularly excellent analogy when he equates the "debate" over rising income inequality with the "debate" over global warming:

This debate reminds me of the debate over global warming, though using the word "debate" implies there is more disagreement than there really is. There are three questions in the global warming debate. The first question is whether global warming exists. The second question is, if it does exist, what is causing it. The third question is what to do about it. In order to avoid the consequences involved with the third step, doing something about it, there are many who try to cloud the issue and keep the first question alive and kicking for as long as possible, or claim the cause is from natural forces that we can do nothing about.

The inequality debate appears to be unfolding similarly with those who would like to avoid policies to address inequality, policies such as more progressive taxation, hoping to keep the first question open as long as possible or claiming that the rise in inequality is the inevitable result of natural market forces and we should not interfere.

There is a role for skeptics, but there is also a time to accept that the preponderance of evidence points in one direction and to begin to think about and implement corrective measures.

The theories that global temperatures may be rising, and that income inequality may be getting worse, both now really seem to have an overwhelming preponderance of evidence, accumulated over many years of rigorous research, to support them. Just as importantly, in both cases there is a complete absence of recent, credible, peer-reviewed evidence suggesting that those two problems do not exist. The volume of supporting evidence, and the absence of contradictory evidence, suggest that it's time to conclude that both phenomena are actually happening.

But, as with global warming, the fact that income inequality is indeed extraordinarily high (and getting worse) is very inconvenient for policy-makers. The specific prescriptions that might be recommended to ameliorate the problem are not going to be easy to enact (if they were, they would already have been done, after all). But if we can at least think more about Mark's next question, we'll be heading in the right direction.

(At least now we know what Al Gore can focus on in the sequel...)