Income Inequality Driven By Large Centralized Federal Gov't

[Shady]

Great report from Reuters...

The federal government has emerged as one of the most potent factors driving income inequality in the United States - especially in the nation's capital

...

In the town that launched the War on Poverty 48 years ago, the poor are getting poorer despite the government’s help. And the rich are getting richer because of it.

The top 5 percent of households in Washington, D.C., made more than $500,000 on average last year, while the bottom 20 percent earned less than $9,500 – a ratio of 54 to 1.

...

That gap is up from 39 to 1 two decades ago. It’s wider than in any of the 50 states and all but two major cities. This at a time when income inequality in the United States as a whole has risen to levels last seen in the years before the Great Depression. …

The federal government does redistribute wealth down to struggling Americans. But in the years since President Lyndon Johnson took aim at poverty in his first State of the Union address, there has been an increasingly strong crosscurrent: The government is redistributing wealth up, too – especially in the nation’s capital.

...

Roughly 15 cents of every dollar from the entire federal procurement budget stays in or around the government’s hometown, said Stephen S. Fuller, director of the Center for Regional Analysis at George Mason University. Last year, that was about $80 billion out of $536 billion in procurement spending, he said. The 15 percent share is far greater than the region’s 2 percent portion of the U.S. population.

“We’re seeing an enormous transfer of wealth from taxpayers to the Washington economy,” said Fuller.

http://www.reuters.c...lity/washington

Washington D.C. lives like Kings, while states and local governments struggle to keep their budgets controlled and to provide a sufficient level of services.

[Sleipnir]

Looking at Scandinavian countries with a larger centralized government than the US, and having a much narrower range of income inequality....

Edited February 3, 2013 by Sleipnir

[TimG]

Looking at Scandinavian countries with a larger centralized government than the US, and having a much narrower range of income inequality....

Yet they are doing that by *reducing* the size of government spending and by privatizing sectors like education and healthcare:

Sweden has reduced public spending as a proportion of GDP from 67% in 1993 to 49% today. It could soon have a smaller state than Britain. It has also cut the top marginal tax rate by 27 percentage points since 1983, to 57%, and scrapped a mare’s nest of taxes on property, gifts, wealth and inheritance. This year it is cutting the corporate-tax rate from 26.3% to 22%.

...

Most daringly, it has introduced a universal system of school vouchers and invited private schools to compete with public ones. Private companies also vie with each other to provide state-funded health services and care for the elderly. Anders Aslund, a Swedish economist who lives in America, hopes that Sweden is pioneering “a new conservative model”; Brian Palmer, an American anthropologist who lives in Sweden, worries that it is turning into “the United States of Swedeamerica”.

http://www.economist...ism-says-adrian Edited February 3, 2013 by TimG

[Michael Hardner]

I think the article mentions outsourcing and tax cuts as contributing to the growth of inequality.

[Shady]

I think the article mentions outsourcing and tax cuts as contributing to the growth of inequality.

You think?

The one I posted is a study related to the federal government.

[Argus]

Great report from Reuters...

http://www.reuters.c...lity/washington

Washington D.C. lives like Kings, while states and local governments struggle to keep their budgets controlled and to provide a sufficient level of services.

This is one of THE dumbest suggestions I've ever seen from a major media organization. Of course there is huge income inequality in Washington! To start with Washington the city is about on par with Detroit insofar as inner city slums goes. There is a vast herd of the underclass in and around the city. There are also tens of thousands of extremely high paid lawyers and lobbyists not employed or funded by government but by corporate America who are there to lobby and persuade government. On top of that, of course, there are huge numbers of highly educated and skilled federal employees, as there are in Ottawa. You think all those people at the Pentagon, CIA, FBI and NSA get minimum wage or something?

[Shady]

This is one of THE dumbest suggestions I've ever seen from a major media organization. Of course there is huge income inequality in Washington! To start with Washington the city is about on par with Detroit insofar as inner city slums goes. There is a vast herd of the underclass in and around the city. There are also tens of thousands of extremely high paid lawyers and lobbyists not employed or funded by government but by corporate America who are there to lobby and persuade government. On top of that, of course, there are huge numbers of highly educated and skilled federal employees, as there are in Ottawa. You think all those people at the Pentagon, CIA, FBI and NSA get minimum wage or something?

Yeah, it's dumb because you don't like the results. Typical. Just keep your head in the sand.

[Argus]

Yeah, it's dumb because you don't like the results. Typical. Just keep your head in the sand.

Let me clarify then. It's the kind of garbage reporting FOX specializes in. It's intended for the slack jawed, air breather set who never learn to engage their brains and simply read a thing and accept it without further contemplation. It didn't take me more than a few seconds to realize why there would be a vast difference in income equality in DC. And the cause of it. To use that as an example of government creating inequality is so much bullshit. The only way government creates inequality is by caving to wealthy corporations which continually adjust the tax codes to relieve themselves of tax burdens.

I pay a ton of taxes, and I don't like it, but I can recognize a piece of ideological propaganda when I see it.

Edited February 3, 2013 by Argus

[Argus]

del

Edited February 3, 2013 by Argus

[Canuckistani]

Remove the govt from DC, and all you'd have is poor people, no income inequality. Usually it's the right wingnuts who accuse the left of seeking this result, but it turns out it's the other way around. I guess the right is just ignorant of the difference between correlation and causation.

Another good example is Boulder, CO. Highest ratio of population with at least a bachelor's degree of major cities in the US, many high income people. Besides CU-Boulder there's the National Center for Atmospheric Research both government institutions. Yet a significant segment of Boulder's population has little or no income. They're called students, but by Slim's way or reckoning it must be the govt that's making them poor.

Edited February 3, 2013 by Canuckistani