Income inequality has been growing since the 2008 self-inflicted bank chaos, indeed that banking stupidity from 2008 accelerated the growing gap. The inequity was so obvious that the Occupy Wall Street protests took the streets and the public consciousness of “the 1%” grew out of it. Sadly, politicians failed to address the root causes of the 2008 crisis. Not all hope is lost, we know what to do fight inequality – we just need to do it.
The New York Times took a look into the debate around inequality and set out to bust some myths about what works and what doesn’t.
No, It’s Not Trade
A rise in international trade — as a share of G.D.P., measured as either imports or exports using data from the Penn World Tables — is associated with equality, not inequality. The United States imports only a small fraction of the value of its total economy, whereas Denmark and the Netherlands are highly dependent on imports.
Or the Rise of Information Technology
Countries with higher rates of invention — as measured by patent applications filed under the Patent Cooperation Treaty, an indicator of patent quality — exhibit lower inequality than those with less inventive activity. As it happens, tech industries in the United States have contributed just a tiny bit to the rise of the 1 percent, and the salaries of engineers and software developers rarely reach the 1 percent threshold of an annual income of $390,000.