Friday, October 21, 2016

Economic Inequality, Cognitive Dissonance, and RQ Part 1

A Yale economist wrote an article in the New York Times, August 28, 2016. The article was titled “Inequality Today, and Catastrophe Tomorrow.” It was pointed out that the extreme gaps In Income and wealth are only going to become worse. Causes included innovations such as robotics and artificial intelligence [driverless cars may result in driverless trucks]; environmental disasters that affect ability to live in certain areas; future wars; and populistic political changes that can affect ability to find work for the less privileged. Prof. Robert Shiller pointed out that presidential campaigns have not looked at long-term solutions only addressing those currently likely to be affected by low wages. He reported that 20 countries were studied over the last two centuries, looking to see how these countries dealt with the less fortunate. Primary findings suggested that taxing the rich was not a main solution to generate equality. Instead, taxes tended to rise primarily as a result of warfare. Economic research has concluded that most people do not vote based strictly on their narrow self-interests. Moreover, individuals do not consequently act to tax the rich even if they don’t possess property. In one study, of people in the United States, were asked” What marginal tax rate would you most like to see on family incomes of $375,000.” 30% was their median answer. Note, the federal marginal tax rate for that income group is 33%. In another study, New Yorkers and individuals from Moscow were asked “What inheritance tax rate for really wealthy people do you think we should have?” The findings were people from New York, said 37% while people from Moscow, said 39%. The article also pointed to a study of four devastating famines in four different parts of the world. Even though there was enough food to keep people alive, food was not shared adequately. It seemed that systems of privilege and entitlement permitted the hoarding of food by people of status and it was not uncommon to see dead bodies on the street. Does economic inequality have a moral component; is it simply economics or is it about political orientation? One definition of “moral” In the American College Dictionary, “Pertaining to or concerned with right conduct or the distinction between right or wrong.” Further, another question, is it the government’s responsibility to fix income inequality? By now it should be clear that voters don’t always vote in their best self-interests, and that there is plenty of division when it comes to so-called entitlements, regardless of religion, or moral concerns. For example, food stamps, or raising the minimum wage can be a no, no, yet paying farmers not to grow certain crops can be just fine, depending upon your political orientation. The belief that a corporation can be good or bad, or that a union can be good or bad is another example of a non-moral or religious belief.

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