4 ms·

You’re comparing apples to oranges. Inequality is not the same as labor vs. capital. There are many rich laborers (surgeons, investment bankers, software engine

You’re comparing apples to oranges. Inequality is not the same as labor vs. capital. There are many rich laborers (surgeons, investment bankers, software engineers) and there are many poor capital holders (pensioners, widows, orphans). Inequality has primarily increased because the wages of high earners has pulled away from median wages. Returns to capital have if anything declined, in contrast. And no, these high earners are not all or even majority executives. CEOs of public companies only make a very small fraction of wage earners in the top one percent. Far more common are physicians, attorneys, tech workers, financial managers, and other professionals. Nor is it an issue that these are high earning workers are “not paying their fair share”. Almost all of their income is taxed as ordinary income at high marginal rates. Many live in high tax states like California or New Jersey and are paying well over 50% marginal rates. Once you account for post tax-and-transfer income, inequality in the United States has not increased at all in the past 50 years.

vannevar 5y ago
It's a fair point that income inequality has been driven to great extent by the professional class. But the message behind the article is that everything's fine because labor's share of income has remained stable. The problem is the growing inequality, not the identity of the people taking a disproportionate share of the income pie. Tax-and-transfer is a response to inequality, and so necessarily lags the problem it tries to address. If current policies were truly maintaining the status quo from 50 years ago, then it follows that wealth inequality would be increasing linearly, and not accelerating as it is.