The average CEO earns 300 times more than the workers at his company. It's out of whack, it's driving inequality, and there's a way to fix it.
With both presidential candidates promising major reform of the federal tax system, we’ll start to hear variations on the phrase, “If you want more of something, tax it less, and if you want less of something, tax it more.” There’s more to taxes than just raising money to support public services and determining who deserves to pay. The tax code sets some basic priorities for the economy and society, so a better way to think about taxes is to ask, “How can we improve the tax code to get the kind of economy we want?”
Inequality was one of the main contributors to the protests sweeping the Arab states. What's in store for America, which is more unequal than Egypt?
What's behind the protests in Tunisia, Yemen, and Egypt—and the growing unrest in several other Arab states? A whole host of things, actually, but one of the most glaring seems to be the shocking, ever-increasing disparity between the wealthy and the needy of those nations.
"They all want the same," Emile Hokayem of the International Institute for Strategic Studies in the Middle East says of the demonstrators. "They're all protesting about growing inequalities, they're all protesting against growing nepotism. The top of the pyramid was getting richer and richer." It makes perfect sense: The rich can only exploit the poor to get richer for so long before the underclass revolts. It may take centuries, but it's bound to give eventually.
If height and income were proportional, the average American would be waist high. The rich would be two miles tall. The poor? Nearly invisible.
Dovetailing off Cord's recent thoughts on American inequality (and inequity), The Economist presents a powerful way of imagining the gap between rich and poor in the United States:
Jan Pen, a Dutch economist who died last year, came up with a striking way to picture inequality. Imagine people’s height being proportional to their income, so that someone with an average income is of average height. Now imagine that the entire adult population of America is walking past you in a single hour, in ascending order of income.