Opinion Editorial | |
| Monday, October 5, 1998 | |
Income Inequalaity is Rising Under Clinton |
In the 1980s, every upward tick in income inequality was trumpeted in
the major media. One constantly read about the disappearance of the middle
class, the rise of a two-tiered economy and other dire consequences of Ronald
Reagan's policies. However, the acceleration of these trends under the
Clinton Administration has been utterly ignored. In fact, the same reporters
who found deep significance in the rising share of income going to the wealthy
in the 1980s now simply deny data showing bigger increases today. For example, Barbara Vobejda of the Washington Post wrote about the latest
Census Bureau data, saying "the new figures show that income inequality
did not increase," and "the gap between rich and poor did not
widen between 1996 and last year." But the facts are otherwise. According
to the same Census report that Ms. Vobejda was allegedly covering, the share
of total income going to the top 20 percent of households increased from
49 percent to 49.4 percent, and the share going to the lowest 20 percent
fell from 3.7 percent to 3.6 percent (see figure).
Indeed, the income share fell for every income group except those at the
top. And lest one miss the point, the Census Bureau even provides a summary
measure of income inequality called the "Gini coefficient." This
is a number between zero and one, with zero signifying total equality (everyone
has exactly the same income) and one signifying total inequality (one person
has all the income). In 1990, this figure stood at 0.428, rising to 0.455
in 1996 and 0.459 last year. In other words, the increase in the Gini coefficient
clearly indicates a rise in overall income inequality during the Clinton
Administration. The trend toward rising income inequality has been going on for a long
time and no one really knows the cause. Among the culprits: trade, immigration,
the decline of labor unions, welfare, demographics and technological change.
A key reason seems to be the increasing value of education and training;
those who have them are increasing their earnings, those without are falling
further and further behind. The point, therefore, is not to blame Clinton for rising inequality,
but rather to highlight the enormous double-standard among those who write
on this issue. Especially during the Reagan years, reporters never failed
to draw attention to much smaller increases in inequality than we have seen
during the Clinton years. Explicitly or implicitly, rising inequality was
always blamed on Reagan's economic policy. However, these same reporters
manage to overlook the much greater rise in inequality on Clinton's watch.
In fairness, they should either apologize to Mr. Reagan or give Mr. Clinton
the same treatment. Source: Bruce Bartlett, senior fellow, National Center for Policy Analysis,
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