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  • Inequality Statistics and Poverty Facts

    “Facts are stubborn things,” wrote Mark Twain, “but statistics are more pliable.” Jonathan Alter amply demonstrates this truism in last weekend’s New York Times Book Review. In regard to income inequality—a perennial favorite among the media and liberals—he opines:

    Over the last three decades, the top 1 percent of the country has received 36 percent of all the gains in household incomes; 1 percent got more than a third of the upside. And the top one-tenth of 1 percent acquired much more of the nation’s increased wealth during those years than the bottom 60 percent did. That’s roughly 300,000 super-rich people with a bigger slice of the pie than 180 million Americans. The collapse of the American middle class and the huge transfer of wealth to the already wealthy is the biggest domestic story of our time and a proper focus of liberal energy.

    This interpretation of income inequality statistics grossly misrepresents the true data. As The Heritage Foundation’s research on the subject reveals, income inequality in the United States is frequently overstated. Conventional measurements of income inequality do not include the impact of taxes on the wealthy and the middle class; the value of realized capital gains; the value of welfare benefits such as food stamps, public housing, the school lunch program, and the earned income tax credit; the value of employee health benefits; and insurance values of Medicaid and Medicare benefits.

    Alter goes on to claim that income inequalities are “the result of politics and policies” that can “be tilted back over time.” It is true that government policies can increase poverty, but this is probably not what Alter has in mind. Government has contributed to inequality through its social welfare policies rather than its economic deregulation.

    In America, a primary cause of child poverty is family breakdown. Today, four out of ten children is born outside of marriage. Sadly, children of single-parent families are seven times more likely to be exposed to poverty than peers in intact families. If unwed mothers married the fathers of their children, their likelihood of living poverty would be reduced by two-thirds.

    In this regard, government policies have only worsened problems, penalizing marriage and incentivizing perverse behavior. The Heritage Foundation has set forth the foundations of a new policy to restore the institution of marriage. Hopefully, the nation’s leaders will take note, because poverty growth resulting from out-of-wedlock births is not just a statistic; it is a fact that becomes less tractable every year.

    James Banks is currently a member of the Young Leaders Program at the Heritage Foundation. For more information on interning at Heritage, please visit: http://www.heritage.org/about/departments/ylp.cfm

    Posted in Culture [slideshow_deploy]

    6 Responses to Inequality Statistics and Poverty Facts

    1. Bob says:

      Hand outs, required by Obamas laws, to States to increase the states welfare rolls is a travesty. It is a power grab, a slap in the face for those on welfare but have the means to get off of it through education….. as shown to be successful over the last 20 years. This new, recent Obama led fiasco must be defunded and we must return to the successful policy prior to Obama.

    2. Steve S. California says:

      "If unwed mothers married the fathers of their children, their likelihood of living poverty would be reduced by two-thirds."

      Might be nit-picky, but the fact is if the Fathers stayed around, the result might actually happened. Babies having babies has no good outcome. The children pay the ultimate price, continuing the cycle.

    3. Tom Georgia says:

      When governments spend more money, the rich will become richer. That's where the additional money flows to before it reaches a stopping point.

      When governments collect more revenues BY ANY METHOD for the purpose of funding their additional spending, the poor will be made poorer. Most of those at or near the top of the income scale, those who are most likely to be the direct providers of the additonal revenue are likely to have pricing leverage that enables them to embed the additional cost in the price of the items of goods or services from which they derive the income which is used to provide the additional revenues.

      The system that we have created through a process of random drift is a trickle up/dump down system with the additional financial wealth trickling up to those at the top while the additional cost of governments is being dumped down onto the backs of those who are further down. The further down it gets dumped, the harder it hits and the worse it hurts when it lands on someone's back.

      It will always be those who have least who will be priced out of the market first.

      Large and growing governments are the root cause for the rich getting richer and for the poor becoming poorer.

      When the percentage of a nation's total purchasing power that is being transferred to govenments reaches a certain percentage, further increasing taxation to get additional money with which to fund additional tax-funded social assistance programs is self-defeating, self-destructive and will eventually destroy the governments who continue to increase their spending.

      Are we there yet? I think we arrived there about 1970 or so and we are now just playing out the string.

      The primary political divide is now between those who depend on governments and those upon whom governments must depend.

      That is not a sustainable situation. Can it be fixed? If so, how?

    4. Ray, Hampton VA says:

      Tom from Georgia – "Can it be fixed? If so, how?" Well, that may be the $64,000 question! We must begin to curb entitlements, stop giving handouts to those who can work, cut taxes to businesses – big and small – so they can increase their payrolls, and cut taxes to individuals so they will have more money to spend in the economy. Every time the federal government takes more money from you and me, we have less money to spend on the things we need. I do not believe the government can spend my money better than I can spend my own. Let me have more of my own money. I'm a business owner. Stop regulating every detail of our lives! Let me run my business without the government requiring reams and reams of paperwork. Let me hire more employees without requiring me to provide more and more documentation, taxes, etc. I cannot expand and grow with the every-increasing paperwork burden that is costing jobs! Government get out of my way!!!

      Vote Tuesday to get rid of the incumbents who have voted for Obamacare, cap & tax, federal regulatory reform, the failed stimulus, TARP, the Fannie Mae and Freddie Mac bailouts. Vote for people who have created jobs in the private sector before. Vote for people who promise to READ THE BILL(s) before they sign them!!! Then hold those folks accountable!!

    5. John W Penfield says:

      This is in the Bible and I belive it to be oh so true; If you give a man a fish you feed him for a day, if you teach a man to fish you feed him for a life time!

      Oh, how very true, since LBH anounced the end of poverty in our life time, poverty has incresed a thousand fold, we have generations that have lived on Welfire all of their lives! I am all for giving a man or women a hand up, but I'm sick and tired of giving a hand out!

      Yes, if someone is disabled and cannot work, then yes, they need help! But you know, I've knowen very few people that coulden't do for them selfs, I once dated an armless girl, she worked and did for herself! She is a truley amazing young women, she's not on Wellfair, she does for herself.

      For four genarations now, we have been giving out a fish every day and never teaching them how to fish, perhaips it's time we started to teach them how to "FISH"!

      Our current Wellfair system has created much more poverty then it has helped, we reward failer, we reward women that keep giving birth to children with no fathers, we reward the worst and penalise the producers of this great nation!

      I'm sorry, it's been proven, "trickle down ecanomcis" does work, "Trickel UP Poverty" does not! When you TAX the producers to death, they stop producing! Just as I did when it cost me more in taxes then I made, then well you gussd it, I stoped producing'!

      I'm sorry, thats just plan facts of life, why would I work harder to bring in much less, when I can be a slacker and bring in more money and not be penalised for beeing more productive?

      The proublum is, we are rewarding the non producers and penalising those that actuley pay the way, the top 4 percent pay over 80 percent of the taxes, (and you want to tell me thay are not paying their fair share)!, while 47 percent of Americans pay no FICA tax at all!

      I'm sorry. I'm not rich by any means, but the so called RICH DO by far more then pay their fair shire in TAXES! When you take more away from them tehn they produce less!

      I'm sorry, thats a fact of live! This is insane, you ask nearley 50 percent of the population to pay no taxes at all and ask the the top incme erners to pay what 70, even 80 percent in taxes!

      just tell me why I would want to do that?

      We need Wellfair reform we ned a lot of reform! Get the dead bets out, why should I pay them to produce baby after baby just to have them pass it on to their kids and their kids, kids?

      And why just why do I owe these Ileagle Alions, ship threm back, that is what 80 percent of Americans want, we are4 beeing envided! Why are we giving them wellfair and food stamps? Kick them OUIT!

      John

    6. Pingback: Lies about our national debt, W, Clinton and Reagan (its just accurate information) - Page 3 - US Message Board - Political Discussion Forum

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