Income Inequality Is Primarily a Blue State Problem

Income inequality is a hot topic these days, especially in the Democratic presidential primary race.  The New York Times writer, Nelson Schwartz, says it is so bad that he asks the question “Is America on the Way to a Caste System?”

But consider:

  • The top four Democratic presidential candidates, Sanders (Vermont), Biden (Delaware), Bloomberg (New York) and Warren (Massachusetts) are all east coast residents.
  • Los Angeles has by far the largest homeless population, 44,000, in the whole country.
  • The average monthly rent for a one BR apartment in San Francisco is $3438, the highest in the country.
  • In fact, the scholar, Richard Florida, has a book, “The New Urban Crisis” pointing out that it is our biggest cities, especially coastal, which are increasing inequality and failing the middle class.

In contrast with the message from the Democratic presidential candidates and the stark figures above, consider that, throughout the country as a whole, Life in America is continually getting better:

Capture51

  • The middle class is not shrinking. The number of middle income ($35,000 – $100,000) plus higher income (> $100,000) households together is expanding rapidly (see chart).  The number of low income households (< $35,000) is shrinking significantly and the middle class is actually thriving.
  • Many developed countries have more billionaires per capita than the U.S.!  Warren Buffett, who lives in Omaha NE where I also live, is the third wealthiest American at $80 billion. His wealth and prestige are of enormous value to Omaha.
  • So what if the wealthy have more and more special privileges?  As a retired math professor from the University of Nebraska Omaha, an average university, and with no extra financial resources, my wife and I are in the group of high income households (see above). We live somewhat frugally by choice but are not restricted in any way from doing what we want to do, from generously supporting our favorite charities to traveling anywhere we want to go.

Summary.  Income inequality is very real, especially in the blue states.  But poverty is a bigger problem than inequality.  There are practical ways to alleviate poverty and society is making much progress in doing this.

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3 thoughts on “Income Inequality Is Primarily a Blue State Problem

  1. While I appreciate the concern that a case can be stated that income inequity is present in the American economic system, I agree with Jack on the facts that such inequity is sometimes over stated and under supported by economic facts.

    Unfortunately, like the argument over climate change and the instant Coronavirus, income inequity is more often than not used as a political weapon to call for income redistribution or unrealistic minimum wage demands rather than actually solving a problem that can be resolved by government interference.

    Again, its time to hope that the current election year will result in new thinking in Washington DC that is led by adults.

    • These problems are often real but, as you say, they demand intelligent decisions and the progressive mindset often overreacts and proposes loony ideas.

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