If we had income equality then there would be no reason to do better or try and succeed. Sure I would like to make as much as the CEO, but I'm not there yet. This is America were good honest work, skills, and the want to succeed brings rewards of yes, more money then your neighbor.

From the Stuff that does not shock me file:

"Income inequality in the Bay Area is now more severe than in the rest of the nation, according to a Silicon Valley economic research institute."

First response: So?
Second response: Geez I hope this study wasn't publicly funded because.....duh!

Without the data this is an utterly useless factoid. A bit like the frothing missives about how many dollars in profit one company or another made while leaving out the very important profit margin data.

I completely agree. This article seems more designed as fuel for divisiveness amongst us rather than to provide any actual information or a matter for discussion.

The big question is, if we decide to lower everyone's income so everyone makes $20,000 per year, how are we going to pay for food and rent?

Everyone cannot make the same pay for different work. Some jobs are more dangerous than others, some require years if not decades of training, some people have more experience than others, etc, etc.

One of the major reasons if not THE major reason for the so-called income inequality is that California is constantly creating high paying jobs (i.e. opportunities) for people. Most of the people that come here, both documented and undocumented, do so to try to improve their lives, and they are coming here in huge numbers every year; so yes, that means the so-called income inequality gap will continue to grow as those newly arrived low income persons swell the ranks.

What we need to be afraid of is the day that the so-called income inequality starts radically shrinking because that will mean one or more of a few things:

* People with money are fleeing the State
* The Economy of California or the Nation has crashed
* Everyone is becoming poorer

None of these are good things and as a previous poster mentioned, if everyone makes the same amount no matter what, what incentive is there to improve?

I would like to see the income equality numbers for Greece. I'm betting the incomes between top and bottom are very close.


Jim Neal
Old Mountain View

"I would like to see the income equality numbers for Greece. I'm betting the incomes between top and bottom are very close."

And I bet you are wrong. But you are wrong on so many topics, so my assumption is not a stretch by any means. I am relieved to see that you are not representing the electorate as a public official.

The right wing comments are typical, but completely off base. . Everyone receiving the same compensation for vastly different jobs would likely sap motivation is true. But if you want to use that extreme example to demonstrate your view then let's look at the other end of the spectrum. How about 99.9 pct of all wealth being held by one person (a king) and everybody else impoverished. Do you think that level of income inequality is healthy?

I don't think it is. It's a matter of balance and there is value in tracking of the data to give us an opportunity to make adjustments before we get to the 99.9 to 0.1 stage.

Anecdotally, the oppressive & regressive tax structure that is CA, combined with the gross urbanization of the peninsula has resulted in more than a few "top 5%" households I personally know of to opt to relocate out of the area - to less regressive tax states - and these folks are not retiring, they are getting out.

Anyone who would bet against me on this would lose that bet. Here is an article from The Wall Street Journal that provides the actual numbers and effects ( Web Link ).

As far as the personal attacks and name-calling by those who hide behind anonymity, I have come to expect that now from people who think that such tactics negate the validity of others arguments.

As far as everyone receiving the same pay for different jobs being an "extreme example"; how so? People keep pointing to the pay of CEO's and Janitors as an example of "income inequality, when the jobs are vastly different, require different skill sets and levels of education. If anyone wants to provide examples of "income-equality" for me to consider that are not already in place or mandated by law, I will happily do so.

The example of a king is also fallacious as "king" is not a paid job. Conflating government and business is exactly the type of obfuscation that renders such arguments incoherent and baseless.


Jim Neal
Old Mountain View

In light one of your usual low-quality, high-whining posts, I would like to offer you some advice, courtesy of Harry S. Truman:

"If you can't stand the heat, stay out of the kitchen."

@Jim Neal:

Why should I reveal my identity? I registered to vote and just like everyone else, my vote is confidential to the public. It is very much within my right to keep my identify confidential if I am discussing how I voted. I am glad I bet against you and I'm glad you lost. But don't just get angry with me. Blame all of the other Mountain View residents who voted for other candidates. As far as I'm concerned, I respect them more than I respect those who voted for you. If you can't deal with that reality, don't run for public office.

You don't seem to understand anything about the underlying problems with the Greek financial fiasco. It largely stems from a culture of income tax evasion. In a country of ten million, only 25,000 declared an income over €100,000.

Since you decided to post a WSJ article that is hidden behind a paywall, here is an alternative source of information, an Oxfam report that is publicly viewable:

Web Link

And yes, Harry S. Truman was right.

Keep running for office Jim, with more of the electorate giving you the thumbs down with each of your low-quality, self-indulgent, whiney posts. Just give me the opportunity to vote for someone other than you and I will gladly do it without fail.

Income tax evasion is a predictable result of Socialist redistribution policies that see income earned by others as the property of the State. What would make more sense is a consumption tax that cannot be avoided by anyone, and where everyone can plainly see and understand what the true tax rates are.

I haven't said anything about people voting for me or not, so I'm not sure where those comments are coming from other than to confuse the issue. I merely noted that people use the safety of anonymity for their personal attacks against me, which is fine; but I think it should be a factor in people's decisions as to what weight to give those opinions.

The WSJ article was publicly available when I posted it or I would not have been able to read it in it's entirety. Perhaps it only prevents viewing when accessed as a link.

Despite all the "thoughtful" responses to my posts, I have not yet, but am still hoping to see some actual examples of what "income-equality" means and some sensible ideas for how it might be achieved.


Jim Neal
Old Mountain View

Here is the WSJ article in its entirety. For whatever reason, it can be accessed by a Google search, but not via a link:

_____________________________________________________
By MATTHEW SCHOENFELD
June 14, 2015 6:12 p.m. ET
167 COMMENTS
The Organization for Economic Cooperation and Development recently published a report, “In It Together: Why Less Inequality Benefits All,” that claimed rising income inequality from 1990-2010 depressed cumulative growth across its member countries by 4.7%. The OECD’s suggested solution: government-led redistribution, funded via tax increases on “wealthier individuals” and “multinational corporations.”

“By not addressing inequality,” OECD Secretary-General Ángel Gurria told reporters on May 21, “governments are cutting into the social fabric of their countries and hurting their long-term economic growth.” The report garnered widespread news coverage, and its conclusions dovetailed with the conventional wisdom among many progressive thought leaders. But the report and the conclusions it promotes are flawed.

From 2000-10, many of the 34 OECD countries propped up growth by launching expansive social programs with borrowed money. But not all. The five most “unequal” countries in the OECD report—Israel, the United States, Turkey, Mexico and Chile—largely abstained. They increased sovereign debt by 3% on average compared with a 40% average increase among other OECD members.

When austerity pressures caught up to debt-laden sovereigns in recent years, however, the less leveraged—and not coincidentally, less equal—member countries grew a lot faster than their peers. From 2011-13, according to the World Bank, the five most unequal countries grew nearly five times faster (3.9% cumulative annual average) than the others (0.84%). By using a 2010 cutoff, the OECD has skewed its findings.

Consider Greece. From 1999-2012, its Gini coefficient “improved” by 6% to .34 from .36—more than any other OECD country. (The Gini coefficient measures income distribution, where 0 represents complete equality and 1 represents a society in which a single person has all the income). Greece’s redistributive social transfer spending also grew most quickly among OECD peers from 2000-12. But Greece’s economy has shrunk by more than 20% since 2010 (World Bank data), and today more than a third of its citizens are considered to be at risk of poverty (Eurostat data).

Chile, which has the highest growth rate this decade—4% annual average (latest World Bank data)—is also the most unequal OECD country, with a Gini coefficient of .5. Despite ranking second-lowest among OECD members with respect to both social transfers and government spending (Mexico is lowest), the poverty rate in Chile fell by 6% from 2007-11 (latest OECD data). This is the largest reduction over that period among OECD members.

The OECD’s claim that “redistribution is, at worst, neutral to growth” is also highly suspect. Essentially its analysis focuses on whether or not increasing income taxes to reduce “net inequality” (inequality after redistribution via income taxes) hurts growth. This measure of net inequality is deceptive. It ignores in-kind benefits like health care, education and public housing. It also overlooks the impact of other forms of taxation like value-added taxes (VATs).

Within the OECD, VATs and similar taxes on goods and services actually account for a larger share of tax revenue (33%) than do taxes on personal income (25%). As a result, the income-tax rate is a subpar proxy for redistribution policy. For example, from 1990-2010 the average marginal income-tax rate within the OECD was cut to 44.9% from 50.6%. But the average VAT was raised to 18% from 16.7%, largely offsetting the cut with respect to revenue generation.

A more representative proxy for redistribution is government expenditure as a percentage of GDP, which encompasses all government spending on the provision of goods, services, subsidies, and social benefits. From 1995-2012, OECD member countries that increased government expenditures as a percentage of GDP grew 30% slower than member countries that trimmed government expenditure as a percentage of the economy over that span—average annual growth of 1.9% compared with 2.5%.

The data are even more revealing in recent years. OECD countries that increased government spending as a portion of the economy from 2009-12 contracted by an average of 1.3% annually; countries that trimmed government expenditure grew by an average of 0.9% a year.

If countries most deeply hurt by the crisis were in most need of government spending to boost their economies, they should have experienced a sharper growth inflection. Not true. In OECD countries that increased government spending from 2009-12, growth in 2012 was 3.2% better on average than it was in 2009. The growth in countries that opted for less government spending was 4.9% better.

The point is not that inequality is “good” for growth. Rather, any backward-looking analysis of growth is implicitly flawed because economies change. Technological change will produce bigger winners and losers. And while European OECD members have been far more equal than their peers across the Atlantic, they have also been far less innovative.

Europe has yet to produce a single Internet company valued at more than $10 billion compared with six privately owned startups worth more than $10 billion in the U.S. Perhaps the OECD’s time would be better spent studying the creation of wealth in this new landscape instead of its redistribution in times past.

Mr. Schoenfeld is an analyst at Driehaus Capital Management LLC.
___________________________________________________

Yet again, you have to go into martyr mode. Never mind that you have shown an exceedingly thin skin for someone who wishes to be "in the arena," as it were. If you want to put yourself out as a serious political candidate, you are failing miserably.

And the Wall Street Journal you reference shows that you have no idea when to look for an analysis that actually analyses a situation, and does not use pointless rhetoric to make a political point (pitiful as it may be). Mr. Schoenfeld may know numbers, but he has no clue about the actual effects of economic policy on actual people.

And your little gem -- "Income tax evasion is a predictable result of Socialist redistribution policies that see income earned by others as the property of the State" -- is a true laugh. So how would you explain income tax evasion in the United States, Jim? Big bad socialism in Washington, D.C.?

The City of Mountain View is better off NOT having you in elected office. Ever.

Anonymous of Waverly Park, you are so quick to criticize and make demeaning remarks however you have yet to offer any alternative facts. If mr Schoenfeld is so wrong, why don't you provide us with a valid counter argumenT. We're all up for a healthy debate but so far all you've done is made disparaging snide comments with no substance.

Jim, I for one am appreciative of the facts and even manor in which you're presenting info. I may not agree all the time but you are at least a rational and thoughtful poster.

Here is another perfect example of the results of "income-equality". We need to learn from the example of this CEO in Seattle:

Web Link (Washington Times Article)



Jim Neal
Old Mountain View