On Monday, December 17, 2012 4:41:32 PM UTC-5, rclough wrote:
>
>  To try to clear up my mistaken interpretation of the gini coefficient,
> namely that USA inequality is not decreasing, it is actually increasing,
> I  find that the per capita wealth is also increasing, so
> let's see what effect that will have.
>  
> Although the fairness index (gini coefficient) has
> grown linearly with time in the USA,
> :
>   
>  
> The real per capital wealth has also increased, but exponentially:
> (Real means inflation-adjusted)
> :
>   
> By eyeball, it looks as though the real per person income GDP increased 
> over the range 
> of the time duration of the gini coefficient growth by about 5/1.5 ~ 3.3 
> .. The gini 
> coefficient only increased from  .4 to .47 or is about  1.17 times 
> larger, or is essentially 
> constant in comparison with the growth in real GDP by a factor of 3.3. So 
> I would say that 
> everybody- the poor as well as the wealthy--  is getting appreciably 
> richer, even 
> though there has been a minimal increase in wealth inequality. 
>

No. It means the opposite. Even if the Gini doesn't increase at all it is 
still so high that any increase in GDP means that it will 
disproportionately benefit the rich - which is exactly what we have seen.

http://www.washingtonpost.com/blogs/wonkblog/post/in-2010-93-percent-of-income-gains-went-to-the-top-1-percent/2011/08/25/gIQA0qxhsR_blog.html
 

>  
> The growth rate is not within our control. The questiion then is whether or
> not the gini coefficient is in control of the growth rate. If not, then
> the debate on taxation ends there. 
>  
> But if the gini coefficient can actually change the growth rate, 
> artificially lowering 
> the gini coefficient by increased taxation of the rich (redistributing the 
> income) 
> hurts the growth rate, so we all get poorer.
>

No. Taxing the rich does not redistribute the income, it adjusts the 
expenses so that those who benefit disproportionately from the public 
resources pay their share for an educated labor force, policed cities, well 
maintained roads, bridges, ports, airports, the grotesquely hypertrophied 
military to enforce monopolistic trade policies worldwide, etc.

We all get poorer by letting the richest turn the entire country into 
indentured servants.
 

> Actually, a lot poorer.
> The data above shows that decreasing the gini coefficient a small
> amount will produce a much larger decrease in the per capita GDP, 
> because the latter decreases exponentially with a linear decrease in 
> the gini coefficient.
>  
> So, in either case, taxing the wealthy can do no good.
>

So first you were going to use the Gini as evidence that things are 
improving for the average person - now that you see it means just the 
opposite you try to claim that inflation actually makes the inequality 
somehow better. 

The most prosperous times in US history correlate directly with the highest 
taxes on the rich. Your analysis is complete fiction. Maybe you're super 
rich, in which case I can understand why you would want to believe these 
fairy tales, and why you would want others to believe them also, but anyone 
who believes this and is not a multimillionaire is being played by highly 
paid propagandists.

Craig

 
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