Income Inequality Will Increase

January 30, 2014
By

It is a natural consequence of two trends: technology and population growth. Barack Obama cannot reverse these trends, any more than King Canute could stop the tide.

Consider the first trend, technology. I use it as shorthand for a number of things: standardization, innovation, and better communications. Henry Ford became immensely wealthy because of a new innovation, the automobile, which he standardized through the assembly line, and was able to popularize through mass communications media. Ford did not set out to create income inequality between himself and others. Yet, income inequality was the inevitable consequence of technology.

Next consider population growth. Bill Gates would be a billionaire, no matter what. But, thirty years ago, when Microsoft was in its early days, the world’s population was just about 4 billion. Today, it’s over 7 billion. Even if all other factors had stayed the same, the addressable market for Gates’ products has increased by 75% over the years, thus allowing him to be 75% wealthier today than he could have been thirty years ago.

Now consider someone on the opposite side of these trends, a retail worker in a boutique store. This worker helps one customer at a time. Population trends have no impact on her ability to earn, since she helps one person at a time. Meanwhile, technology (standardization, innovation, and better communications) works against her, by giving Walmart and Amazon the ability to put her out of business. No wonder her real income hasn’t kept pace with Bill Gates’!

I don’t see these trends ending anytime soon. So income inequality will increase. But a rising tide lifts all boats. The typical “poor” American, according to census data, has a car, air conditioning, a refrigerator, a stove, a DVD player, and a color TV. It should go without saying – but usually doesn’t – that in, say, 1960, someone who had a color TV, a refrigerator, air conditioning and a car would not be considered poor.

15 Responses to Income Inequality Will Increase

  1. ATTILA727 on January 30, 2014 at 3:41 pm

    The constitution does not mandate “income equality”

    • Jake on January 30, 2014 at 4:12 pm

      Guillotines do.

      • Tulipomania on January 30, 2014 at 4:21 pm

        Democrat hordes at the gates demanding to take shit.

        • Jake on January 30, 2014 at 4:37 pm

          You can only rip off the working class for so long before heads start decorating the place.

          • PoliPundit on January 30, 2014 at 7:09 pm

            Oh, those poor working classes, with their air conditioners, cars, Internet, cell phones, cable TVs, and too much food. What a rip-off!

          • Jake on January 30, 2014 at 8:40 pm

            Forty years of stagnant wages, despite skyrocketing producitivty, and a shrinking middle-class, but let them eat cake have cell phones.

          • ATTILA727 on January 31, 2014 at 6:32 am

            What flavor of leftist kool aide are they serving you nowadays comrade lemming ?

  2. Shrinking Middle Class on January 31, 2014 at 2:15 am

    We’re a product of this president’s fundamental transformation of America. We will live on the dole. It is our patriotic duty. Sorry, I can’t stick around, I have better things to do like sit on my ass and do nothing for myself other than bitch about the “rich”. It is my patriotic duty. If you disagree you are an ignorant, racist,homophobe who hates bi-racial family themed Cheerios commercials.

    • Pluto on January 31, 2014 at 3:58 am

      We’re a product of this president’s fundamental transformation of America.

      More accurately, Obama has had minimal impact on the character of America.

      We will live on the dole.

      Not really.

      It is our patriotic duty.

      Bullshit.

      Sorry, I can’t stick around, I have better things to do like sit on my ass and do nothing for myself other than bitch about the “rich”.

      No, you are bitching about the poor.

      It is my patriotic duty.

      Bullshit.

      If you disagree you are an ignorant, racist,homophobe who hates bi-racial family themed Cheerios commercials.

      Or not. You are prone to hyperbole. Cheerios? Care to elaborate?

  3. Ken_phd on January 31, 2014 at 10:44 am

    Poli:

    “Yet, income inequality was the inevitable consequence of technology.”

    Where did that come from?

    Technology, in itself, responds to industry’s needs for efficiency and increased productivity. Technology creates overall jobs, not reduces them. Henry Ford is a prime example. The increase in technology allows more mobility in real earnings. It does not stifle them. Measure the income inequality of the most backward nations where low technology workers have no hope.

    You can blame income inequality on any number of factors, but technology is not one of them.

  4. Tulipomania on February 3, 2014 at 7:07 pm

    http://www.rasmussenreports.com/public_content/politics/elections/election_2014/kentucky/election_2014_kentucky_senate

    Once again, tea Party libertarians more popular than establishment candidates

    Poll: McConnell Tied With Democrat Alison Lundergan Grimes; Bevin Leads Her By Six

    • Walter Williamson on February 11, 2014 at 9:43 am

      Every poll and trend keeps sayiing the same thing. GOP Tsunami sweeps against the dems hard in the House (notice the elder dems retiring ahead of the wave?) and that a lesser Tsunami was will be more than enough to sweep the dims out of power in the Senate.

      The Tea-Party will gain even more influence and the dims will be blamed for everything wrong with the economy for years to come, since it was their failed ideologies that wrecked the economy and then kept it down as the worst recovery in U.S. History (more like “Non-recovery”).

      Tsunami wave is coming – and the dimwit rats are already fleeing their sinking ship!

      LOL!!!!

  5. Tulipomania on February 5, 2014 at 7:24 pm

    Boehner and Cantor are Democrats plants within the Republican party.

    No doubt about it at this point.

  6. maddog on February 15, 2014 at 8:13 am

    Pluto has never recovered from being reclassified as a dwarf planet, which explains the stupidity of his posts.

  7. Stan the Man and the Pharohs on February 22, 2014 at 1:29 pm

    Just for the record, the Bones episode The Soldier on the Grave had an all-time suck factor. It is sincerely hoped none of the scriptwriters are never allowed near any writing instruments of any sort during the rest of their lives.

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