9 ms·

The solution is none. There is no "solution" because it, in itself, is not a problem. The problem is that everybody feels entitled to a top 10% salary and many

• _delirium 15y ago
  nowadays even the lower 10% have their basic needs covered and some left for leisure Only really because of what's left of the welfare system, mainly Medicaid, Section 8 housing, food stamps, and the EITC; which I agree does help on the low end, but is increasingly being time-limited and rationed (e.g. Section 8 is hard to get into). The 10th-percentile household income in the U.S. is around $12,000. If that's all you had to live on, even in cheapish parts of the US it'd be quite a stretch to pay rent+food+transportation+healthcare out of that, especially for more than one person. The problem is that a society where everybody have similar incomes is somehow fairer, when there is no logical chain leading there and to top it off it causes ruination. Well, I've lived in both the U.S. and Denmark, which have very different levels of income inequality, and I wouldn't say Denmark has suffered ruination. There are pros and cons, of course. The logical chain isn't that complex if a society actually wants to implement it; it doesn't require some kind of communist revolution, just high and highly progressive taxes (including on capital gains), a national healthcare system, and a strong safety net.
  • yummyfajitas 15y ago
    The 10th-percentile household income in the U.S. is around $12,000. If that's all you had to live on... It's not all you have to live on. People in these income ranges tend to have consumption of $18-22k. ftp://ftp.bls.gov/pub/special.requests/ce/standard/2009/income.txt The missing piece of the puzzle is that a lot of people in these income ranges receive many benefits which do not qualify as income.
    • _delirium 15y ago
      That's what the first part of my reply is, isn't it? EITC, Section 8 housing, food stamps, Medicaid, etc., are where the extra money comes from. Which I agree is a good thing, and what makes it at all possible to claim that the 10th-percentile income is one that's possible to live on. But I don't think those programs are very secure (they've been significantly cut, many are hard to get into now if you weren't already in, and I think more cuts are likely), so the prospects aren't great.
      • jpadkins 15y ago
        Umm all of those programs budgets grow year over year every year.. Some of them spiking in recent years. Cuts from future growth rates are not cuts, they just slowed growth of a program.. You might be able to paint a picture of cuts per capita, but that is due to immigration driven population growth, not cuts to the program.
  • muyuu 15y ago
    Denmark's safety net is one thing, some whacko communist universal subsidy is another. Said safety net doesn't decrease disparity significantly, while giving some universal coverage for basic needs. As long as it's not a bigger burden to the economy than the alternative, I'd have nothing against something like this. I also believe the safety nets here in the UK are about right, in general terms. The government is still too big though. Denmark's income inequality has increased during the last decades together with their living standard. http://www.oecd.org/document/22/0,3746,en_21571361_44315115_49185046_1_1_1_1,00.html http://www.oecd.org/document/22/0,3746,en_21571361_44315115_... Notice the language there. "The situation has worsened" because the rich are now richer, even though the living standards have improved dramatically in all income ranges, somehow "the situation has worsened" because now the gap is 6 to 1, instead of 5 to 1 as it was in the 80s. http://en.wikipedia.org/wiki/Income_disparity http://en.wikipedia.org/wiki/Income_disparity
    • jnorthrop 15y ago
      Did you really think a national healthcare system is a "whacko communist" idea? If you want to debate it's merits please do, but don't resort to petty name calling.
      • muyuu 15y ago
        Nope. I actually take a National healthcare system for granted, ideally working under proper scrutiny. I'd rather have what we have here in the UK than what's in place in the US (as far as I know about it). I was talking about this other idea: http://en.wikipedia.org/wiki/Basic_income_guarantee http://en.wikipedia.org/wiki/Basic_income_guarantee
        • gyardley 15y ago
          It's not a completely wingnut idea. I first bumped into it in Hayek, who was in favor of it and not much of a socialist. The rationale works like this - given that some less-fortunate members of society will need assistance at some point in their life, and given that 'conservative' != 'asshole' and we don't want to just let them die in the street, we have to provide some form of limited welfare state. Since we have to provide some form of limited welfare state, what's the best way to do it while preserving as much freedom as possible? We could set up a large government bureaucracy to do this, with rules and regulations and intrusive measurement for determining who can get what, or we could simply periodically cut everyone a small check. Hayek thought the small check was a lot less harmful than the large bureaucracy. I'm inclined to agree. It'd be better still if the government could get out of the welfare business altogether and leave it to our individual communities - I certainly don't mind that my synagogue dues are used to help our poorer members, and if my tax bill was lower, I'd have still more to donate. But that would require a cultural shift to make practical - it's a shame, but most people in America no longer belong to small, supportive communities.
• AlisdairO 15y ago
  Excessive salary disparity is a problem for any resource that is limited in quantity - land, for example. There's also many other issues that are substantially effected by income inequality. I'd recommend a look at The Spirit Level, a decent enough book on the topic.
• mike-cardwell 15y ago
  I come across this "salary disparity isn't a problem" comment every so often and need to call it out. Salary disparity is definitely a social problem. When one person has the money of hundreds or thousands of others, they can wield significant power over them. I have no problem with there being rich people, but I find it obscene that our society allows people to become billionaires.
  • anamax 15y ago
    > When one person has the money of hundreds or thousands of others, they can wield significant power over them. Oh really? What is that power? The power to get govt to things on their behalf? There's your problem. Note that organizations also have power. Why should I be any happier when the AARP influences govt than Larry Page?
    • mike-cardwell 15y ago
      The fact that you've identified an additional social problem doesn't mean that the original social problem that I declared exists, doesn't exist. The only thing I addressed was the claim that massive salary disparity isn't a problem. It is a social problem.
    • roc 15y ago
      > "Why should I be any happier when the AARP influences govt than Larry Page?" For the same reason you should be happier that it's possible to win a Presidential election in the US with less of the popular vote than your opponent, as opposed to, say, a plutocracy simply choosing the winner. Neither is great, but one is at least representative of compromise and shared values across a very large chunk of the nation where it's very unlikely they all share the same best interests.
    • batista 15y ago
      Oh really? What is that power? The power to get govt to things on their behalf? There's your problem No. That's one of the problems (others: cartels, influencing public opinion with your media, having people or ideas killed, using his money to buy influence with people, etc). And you seem naive enough to think that somehow we could do with him not getting govt to do things on his behalf. Maybe by reducing or eliminating the government? This is a sure-fire, tested way to have the rich guy and his friends have a free reign to anything with no stop gaps. You seem to see it: (1) government = some people with power, that they abuse or rich people can buy them. It would help to also see it this way: (2) government = the ONLY power that is elected and somewhat controlled by the general public and its will.
• gorbachev 15y ago
  I don't know. I don't think you analyzed the problem accurately. I think it's a pretty simple demand vs supply problem. Too much supply of unskilled (or average skilled) labor, but not enough demand. What you describe is a symptom of the root cause. Population control seems like one potential solution. Of course given the norms of most of today's societies, telling people they can't breed is not gonna work too well.
• mason55 15y ago
  Not salary disparity though, as it isn't a problem in the first place. Salary disparity is very much a social problem. Crime is correlated much more highly to income disparity than it is to income. Even poor-on-poor crime is correlated to overall societal disparity, it's not just rich people getting mugged and secretaries embezzling funds.
  • ajkessler 15y ago
    How do you explain some of the highest income disparity in the last century with the lowest crime rates, well, pretty much ever?
    • roc 15y ago
      If the correlation between income disparity and crime rates remains despite a net drop in crime, how is that a refutation of inequality of disparity as a component to crime? Wouldn't a larger drop in crime in more-equal countries than less-equal countries only re-affirm that though there are clearly other factors involved, inequality is still a component? I don't actually know the numbers but I'd think it would be pretty easy to look and see whether crime rates are dropping uniformly, or if less-equal countries are seeing a lower drop than more-equal ones.
      • ajkessler 15y ago
        Sure. But since income disparity has soared in the last 40 years and crime rates have plummeted, even if they have plummeted everywhere, this indicates that inequality, if it has any effect at all, is likely pretty minor. I think this would be near impossible to test for though. So many factors affect crime rates across difference societies, and different societies experience wildly different types of income disparity. Intuitively, I imagine places with smaller net income disparity but larger real income disparity (ie a city where everyone is relatively poor but some are destitute) have much more crime than places with larger net income disparity but smaller real income disparity (ie a city where everyone is relatively wealthy, but a few are unbelievably rich).
• infotitan 15y ago
  |nowadays even the lower 10% have their basic needs covered and some left for leisure. What dream world do you live in? The bottom 10% have enough to live and leisure?! Where the heck did you get that statistic? And how much money, exactly, do you think people need to have their "basic needs" covered with money left over for leisure? |Not salary disparity though, as it isn't a problem in the first place Again, this is clearly based on your own opinion rather than any facts. If you were paying attention you'd see that having less income disparity leads to less crime, increased satisfaction within the population, better health of the population (and therefore productivity), decreased violence, decreased drug abuse, etc. Watch Richard Wilkinson for specifics: http://www.ted.com/speakers/richard_wilkinson.html http://www.ted.com/speakers/richard_wilkinson.html Income disparity absolutely is the problem. We shouldn't have total income equality, I don't think that is realistic, but we should set up our society so we can minimise it as much as possible.
• mcantelon 15y ago
  >The problem is that everybody feels entitled to a top 10% salary and many would kill for "their fair share" when nowadays even the lower 10% have their basic needs covered and some left for leisure. Nonsense. Everybody doesn't feel entitled to a top 10% salary: most would be happy with the kind of jobs that were commonplace a few decades ago before globalization enabled the economicly fortunate to sell their fellow citizens out.