The Democrats’ loss in the midterm elections was unfortunate on many levels, but
particularly because the prospect of addressing income inequality grows
dimmer, even as the problem worsens.
To
only modest notice, during the campaign the Federal Reserve put forth
more sobering news about income inequality: Inflation-adjusted earnings
of the bottom 90 percent of Americans fell between 2010 and 2013, with
those near the bottom dropping the most. Meanwhile, incomes in the top group rose.
Lower
taxes means less for government to spend on programs to help those near
the bottom. Social Security typically provides a retiree with about
half of his working income; European countries often replace two-thirds
of earnings.
Similarly,
we spend less on early childhood education and care. And another big
difference, of course, is the presence of national health insurance in
most European countries.
All told, social spending in the United States is below the average of
that of the wealthiest countries. And other governments help their less
fortunate citizens to a greater extent than we do in ways that are not
captured in the income statistics. The United States, which is the only
developed country without a national paid parental leave policy, also
has no mandated paid holidays or annual vacation; in Europe, workers are
guaranteed at least 20 days and as many as 35 days of paid leave.
To
his credit, President Obama has succeeded in keeping income disparities
from growing even wider, by such measures as by forcing tax rates on
the wealthiest Americans up toward fair levels.
Meanwhile,
on the programmatic side, among the many meritorious aspects of the
much-maligned Affordable Care Act are its redistributionist elements:
higher taxes on investment income and some health care businesses are
being used to provide low-cost or free health care to a projected 26
million Americans near the bottom of the income scale.
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