Sunday, October 30, 2016

Jim Woodbrey on issues that matter

Jim Woodbrey writes about The candidates and the issues that matter in this morning’s “In My View” in the Green Valley News.

One of the issues resonates with your Scriber: income inequality. It is certainly one of the economic drivers of Trumpism and needs to be addressed by the next (Clinton, I hope) administration. Here are snippets from Jim’s essay.

Income inequality has clear-cut, direct adverse effects on most Americans, from lowest incomes right up through the middle class and into lower managements. It stems from inadequate compensation, inadequate sharing of profits and consequent inadequate economic demand. It amounts to killing the goose that lays the golden eggs.

Over the period 1990–2015, income inequality’s most conservative measure — the difference of real mean and real median compensations — amounted to just under $36 trillion largely lost from the economy. These trillions held by the very wealthy made little contribution to the deficient economic demand. They have proven time and again not to trickle down in large measure directly into investments in education, infrastructure and other private job creating programs.

For those of you not familiar with the statistics Jim cites here is a tiny tutorial. Assume a universe of 100 wage earners in which the average mean yearly wage is $30,000. Assume also that 50 0f those workers earn wages above $30,000 and 50 earn wages below $30,000. Thus the median is also $30,000. Now suppose that we add another worker to the universe and that this worker earns $30,000,000, that is 30 million. The median will hardly budge, but the mean will skyrocket. So the difference, mean-median, is an indicator of economic inequality. The bigger the difference the more money is held by those at the top.

Do read Jim’s essay for more on issues that matter, how neither Republicans nor Democrats have effectively addressed them, and what a Democratic administration must be doing in the years ahead.

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