As regular readers know, I'm a big fan of Dean Baker. Today he demolishes the claim that current levels of inequality are the result of market forces before which we are powerless to act. But no, as Dean shows with numerous examples, its not the invisible hand of the free market that is causing inequality, it's government policy. Baker's list is admittedly incomplete, so I'm going to add a couple of my favorites.
The first is low hanging fruit. With an exception during the Clinton years, we have had more than 30 years of tax cuts aimed disproportionately at the rich. While the rest of us get some crumbs off the tax cut table, most of those are vacuumed up by the inevitable need to raise taxes at the state and local level, not to mention the reduction in funding to essential services that causes among other thing, widespread and unfair taxation in the form, for instance, of student loans taken out to pay for an education that should be free.
But the most unequal of us all, as Baker points out, are the bankers:
At the top of the list are of winners are the Wall Street money boys. Does anyone think they would be as rich if the government taxed the financial sector the same way it taxes every other sector in the economy. Even the International Monetary Fund has called for additional taxes on the financial sector in the range of $40 billion a year to make its contribution to the Treasury comparable to that of other sectors. (My favorite here is a financial speculation tax like the one the U.K. has applied to stock trades for more than three centuries.)
via Beat the Press
But shouldn't we add the government policies that preserve inequality, particularly for the Wall Street money boys. Had they not been bailed out in 2008 at least some of the boys would not be as more equal as they are now. When we peons get into trouble the government might step in to make sure we don't starve, though the Republicans don't like even that very much, but when the boys get into trouble it makes sure their big money bonuses get paid. That’s a lot better than food stamps.
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