In terms of relative buying power, going from $7.50/h to $15/h is a much bigger jump than going from $70/h to $210/h. This is sort of a sick twist on the idea that "the house always wins" or "the market can remain illogical longer than you can remain solvent": at lower incomes, it sometimes only takes one car maintenance, one unexpected trip to the dentist, before you have to start picking and choosing what bills to pay. At the higher end, you're picking and choosing what vacations to put off for a little while.

Incremental money at the lower end is worth way more. Inequality is the problem.

You just agreed that a situation which increases inequality (rich person gaining 3x, poor person 2x) helps the poorer person more.

How do you reconcile this with the claim that inequality is the problem?

According to that liberal bastion, the Wall Street Journal, in it's most favorable light, median worker compensation has only gone up about 40% since 1979 [1]. On the other hand CEO compensation over that period has gone up about 1000%. [2] We can quibble about sources if you like, but according to this [3] it's taken about 50 years to double income.

If you take a long look at that same graph [3], productivity has climbed, dramatically. Perhaps the depression of wages was caused by almost doubling the workforce, adding women.

Eh, it's probably not that big of a deal. that wsj article pointed out it's really just young men without much education that are taking the hit. I really doubt having millions of young, broke, easily persuaded males will cause much of a problem. Historically, that's always worked out just fine

Less snarkily, economists from Greenspan to Krugman have said this is something that needs to be looked at. It's an indicator of something being not right. It's clear you have an economic model in mind. It's the job of the market to push that pay edge as hard as possible, get as much productivity for as little pay as possible. Have you considered that the market might push so hard that your economic model doesn't apply?

[1] http://blogs.wsj.com/economics/2015/07/06/just-how-stagnant-...

[2] http://www.epi.org/publication/ceo-pay-continues-to-rise/

[3] https://upload.wikimedia.org/wikipedia/commons/4/45/Producti...

Tl;Dr my hypothetical of everyone getting richer is an accurate description of reality. Also, formerly excluded groups (e.g. women) saw faster income growth than the former privileged class (white men).

No. the WSJ graph shows high school level education and lower men of any race being about 10% worse off than 1979. 40% of americans only have high school education so, uh, like 70 million people or so.

Everyone getting richer is not an accurate description of reality.

That's just basic economy. And it was also adequately explained in the post you just responded to.

The more you already have of something the less it's worth to you, that goes for almost everything including money in this case.

Isn't inequality just a polite word for jealousy? We're all peasants compared to some possible future generations 100 years in the future with all their cancer cures and Mars holidays.

No, it is not. "Jealousy" is a subjective feeling, "inequality" says something about the bigger economy.

Most of the problems with inequality come down to envy but because people are taught to be ashamed of envy, they work hard to both overintellectualize the emotions and cast things as a moral issue in a massive societal campaign of self-deception.

It's a real shame, because it is literally impossible to solve a problem you deliberately misunderstand. That's humans for you though.

And you think possible future generations are going to want to lord things over us?

Don't play dumb. They're going to break down crying when they're told what our planet went through right now. It will be like when today's children are made to really look at photos of Auschwitz, or the Syrian Civil War, or guinea-worm cases in Africa, or child labor in coal mines.

Oh wait, some of those things are still present-day problems.

Right but his point is that those things are problems because they suck in absolute terms, not relative ones. Turning the whole world into a Syria-esque battlefield should not be considered a success, despite the fact that it would lower inequality. Similar, if the mechanisms that eliminate guinea-worm come so at the cost of improving other people's lives even more than the Guineans, we should not oppose that even though it increases inequality. What matters is our absolute quality of life rather than our relative one, and as such inequality is not the metric we should use to identify problems.

>one unexpected trip to the dentist, before you have to start picking and choosing what bills to pay.

Note that the article assumes poor white people all have salaried jobs with great medical insurance plans, or at least get sick pay. Of course they don't.

Therefore the article doesn't understand that lots of people fall into the trap of not fixing something when its small, and instead end up lowering the average lifespan.

Look at, say, alcohol addiction. Lack of medical coverage means if you got treatment your whole family would get the economic death penalty via direct and indirect costs, ruining all their lives, or you can auger in and ruin just yours. Either way, all outcomes of addiction are decreasing average life span.

Inequality suggests people who are skilled to perform a job are not paid equally to others for similar skill sets. Is someone working your local fast food restaurant suffering from inequality compared to a software engineer earning ten times as much when one cannot ever hope to do the other persons job?

Besides pay one of the largest burdens the poor face are all the government fees and indirect taxes that most of us don't notice in our daily lives. That twenty dollar tag fee renewal to me is nothing, but if you have to have a car and aren't clearing much twenty bucks can mean beans and rice.

Government already has the ability to track all fees paid it directly and can make assumptions about indirect fees so that the working poor; far different from the non working poor; can be relieved of some of the burden.

The only other option for solving inequality as many bemoan is to take from those earning so much so they really don't see the point and eventually everyone ends up poorer.

We can't have the jobs that we want and make the things that we want if the market can't afford to buy them.

As well as focussing our discussion on economic equality and social justice, we can also approach the problem from a perspective of enlightened self-interest.

Widely distributed economic equality implies a greater ability to spend, and a greater ability to borrow, and a greater ability to create wealth in aggregate.

A wider distribution of wealth, on average, yields greater wealth overall.

This doesn't imply equality -- just a distribution of wealth that is closer to a Normal/Gaussian distribution, with less of it's "energy" disappearing off into the upper tail of the wealthy -- a tail which is necessarily inefficient due to its' bandwidth constraints and limited decision making capacity.

I suspect I'd be sadder, though certainly there's some ratio at which my happiness at our gain in overall wealth would outweigh my sadness at our increased inequality.

Let me suggest one of those data-driven analyses you like: for a set of equal-population regions or some such (ideally not just countries, although that might be the only way data is available), plot a happiness measure against mean wealth (income might be easier to get figures for) and Gini coefficient, and do a linear regression or similar. That should give a formula for how efficient wealth redistribution policies need to be (i.e. how much they need to lower the Gini per dollar-per-capita expended[1]) to be worthwhile in terms of increasing overall happiness.

[1] Of course actually redistributed dollars aren't expended and don't change average wealth at all. But the redistribution programme would involve a certain amount of labour that could otherwise be used productively being redirected to administration, court battles, police etc. and the value of that labour is expended.

Suppose I ran the same analysis, but put "% black people" on the x-axis. Suppose that this gives me a better fit than your proposed analysis. Would you then accept that as a formula for how efficient re-segregation would be?

Or in this case, would you recognize that correlation isn't causation?

> Suppose I ran the same analysis, but put "% black people" on the x-axis. Suppose that this gives me a better fit than your proposed analysis. Would you then accept that as a formula for how efficient re-segregation would be?

Yes, although surely segregation just moves people around and can't change the average percentage, and so the net effect would always be zero.

> Or in this case, would you recognize that correlation isn't causation?

Do you think the causal factors are different then? I think inequality directly causes unhappiness in and of itself. That matches my subjective experience and the rhetoric I hear from many others.

Well, of course inequality itself is not the problem. If a loaf of bread costs 0.20$ and rent is 50$/month, while keeping all salaries at their current level. However, inequality has a definite effect on economics and prices, so we can deduce that if the ratio of the two salaries were greater than it already is, while the job remains the exact same, then his mother would be in a worse position.

I should have clarified that I meant those dollar figures in real terms. In the scenario I'm describing one of them can buy 2x as many things while the other can buy 3x.

Inflation is a separate problem.

Well of course inflation is a separate problem if you define figures in real terms...that's essentially a tautology, since real is defined as nominal minus inflation.

Back in the real world however, the relative price/value/production of things is not a separate problem...and since I'm guessing most people's objections to inequality is not its effects in some hypothetical world where all concepts are independent, but in the real world where they all connected, I'm not sure hypotheticals of this nature are often that useful...

Hypotheticals of this nature are useful for figuring out our terminal values. If the situation I described does not make the OP more sad, then inequality is not the ultimate problem.

If you want to claim that inequality somehow causes poverty (and poverty is the real problem), make that case.

>> However, inequality has a definite effect on economics and prices, so we can deduce that if the ratio of the two salaries were greater than it already is, while the job remains the exact same, then his mother would be in a worse position

> Inflation is a separate problem

It's not just inflation: supply/demand dynamics will be changed across income levels. For example bidding wars might cause rentals to go up, and the mother will be outbid (see: gentrification or recent news on San Franciso rents)