Fixing Income Inequality

In a recent op-ed in Barron's (April 18, 2019), Professor Michael Pettis of Peking University points out the dangers of income inequality, comparing our situation today with that of the late 1920s.  This comparison is commonplace among progressives, who seem to think that the mere mention of "late 1920s" is enough to stampede the public into demanding progressive government interventions.  In this case, it amounts to extortion: share the wealth, or we'll have another Great Depression.  But if you share the wealth, both poor and rich will thrive.  "The benefits would eventually trickle up — even to the rich," Pettis writes. Who could argue against making everyone rich?  The problem is how to do it. Pettis claims that "if income were more widely distributed, the U.S. economy would grow faster" due to increased spending and demand.  But neither Pettis, with his demand-side...(Read Full Article)