Net Worth, Not Income, Is Right Measure of Inequality
According to Kevin A. Hassett and Aparna Mathur's(op-ed, Oct. 25), analyses showing growing inequality in the U.S. err by focusing largely "on pretax incomes while ignoring the transfer payments and spending from unemployment insurance, food stamps, Medicaid and other safety-net programs." The authors tell us that in measuring inequality, we should look to consumption rather than pretax cash income. This, allegedly, is because consumption "will be set by consumers with an eye on their lifetime incomes."</br></br>Oh, really? How about single parents, pensioners or enlisted military personnel who resort to payday loans? Their consumption is set with an eye on their immediate, pressing needs, not their lifetime incomes.</br></br>The authors seem to think that inequality can be measured by the quantity of washing machines or microwaves in poor homes. They don't consider debt levels. They seem unacquainted with foreclosures. They show no interest in future prospects.</br></br>Most remarkable of all, the authors would undo the very basis of the equality, such as it is, that they perceive in America. The safety net? Trash it, or at least "reshape" it.</br></br>So I guess what Mr. Hassett and Ms. Mathur really believe is that if the extent of inequality isn't so bad after all--how silly of we liberals to think otherwise. We should change that right away.