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After the last century, it shouldn’t even be controversial to assert that the more a nation focuses on income inequality, the more it hurts the poor. After all, there have been whole societies formed around the slogan Marx popularized, “From each according to his ability, to each according to his need” — and they’ve universally been lousy places to be poor. Would you rather be poor in America or Cuba, Vietnam or the old Soviet Union? If the question doesn’t answer itself, P.J. O’Rourke’s quotation about traveling to the Soviet Union with a gang of Communists should answer it for you, “These were people who believed everything about the Soviet Union was perfect, but they were bringing their own toilet paper.” Meanwhile, we live in a world where China has seen tremendous economic growth by embracing some of the capitalistic policies that made America a superpower while the Democrats are embracing some of the policies that led to hundreds of millions of Chinese living in huts on less than a dollar a day…
What liberals don’t realize or alternately, just don’t care about, is that their obsession with income inequality may make them feel good, but it actually hurts the poor in a number of ways.
1) The higher the government mandated minimum wage/living wage, the more people it prices out of jobs: When you force businesses to pay people more than they can return in value with their work, companies tend to respond either by hiring better quality people, replacing the jobs with automation, moving the posts overseas or by looking for opportunities to get rid of the positions entirely. The higher the wages and benefits the government insists on, the more stagnant it makes the labor market for the people who need to build their skills the most. If your goal were to deliberately put as many young, unskilled single mothers out of work as possible, the best politically feasible way to do it would be to jack the minimum wage up into the stratosphere.
2) It emphasizes making people more comfortable, not helping them succeed: There is no shame in taking any honest job, but you’re not supposed to make a living pressing the button that drops the fries into the grease at McDonald’s. If you work long enough at an entry level job to worry about raising the minimum wage, you’re failing your family, your society and yourself. Instead of encouraging minimum skill workers to demand that the government force businesses to give them more money than they’re currently worth, we should be encouraging people to build their skills and move up, move on or start their own business. Want poor people to be eligible for more education or training? Want to give them micro-loans? Want to make it easier for them to create small businesses? Those are policies that make poor Americans more valuable. That’s good for them and the country. On the other hand, trying to redistribute income ultimately brings everyone down, especially the poor Americans who lose their drive after becoming dependent on it.
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