Anyone can succeed in America!
Megan McArdle is most concerned.
I doubt Occupy Wall Street will be assuaged by learning that the top 0.1% now only receive 8% of the income earned in the US, even if that number is the lowest it's been since 2003.
But I think it does matter. If we think there's a real problem, we need the best possible data so that we can understand its contours. Income inequality has been rising for so long that people have started to assume that it has just kept rising, even when the data show otherwise. We don't want to spend years focused on income inequality, only to learn that the financial crisis fixed it for us.
McArdle has taken to declaring that the Occupy Wall Street crowd is just a bunch of angry kids who can't get a job out of college but she gives herself away with this post on income inequality. She realizes that the protesters are concerned with the increasing concentration of wealth (and therefore power) into fewer and fewer hands and so she attempts to minimize inequality. America is no longer the land of opportunity and while some zombie lies never seem to die, the lie of upward mobility is finally beginning to sustain some damage. By ignoring wealth inequality and downplaying income inequality, McArdle does her very best to reanimate that zombie.
Now that McArdle has diverted attention from growing inequality, she shifts the focus to a plausible-sounding explanation for public unrest.
(If income inequality is declining, what's all that happening on Wall Street? Well, for one thing, the data I've seen seem to show that whatever has been happening to incomes, unemployment inequality remains very much with us.)
In McArdle's mind it has now been definitively established that the Occupy Wall Streeters are a bunch of bored, out of work kids who are protesting until they they find a decent job. Her prescription for dealing with lasting joblessness is a modest amount of unemployment benefits doled out to the masses. Otherwise, we should simply let the banks continue to make record profits while the middle class sinks further into poverty.
McArdle benefits from inequality; the very rich provide an inexhaustible supply of funds to keep the propaganda flowing. Incentives matter, as McArdle often tells us, and she has all the incentive in the world to downplay wealth inequality.
Why has income inequality been rising since the 1980s?
Maybe that's why.