17As he was setting out on a journey, a man ran up and knelt before him, and asked him, “Good Teacher, what must I do to inherit eternal life?” 18Jesus said to him, “Why do you call me good? No one is good but God alone. 19You know the commandments: ‘You shall not murder; You shall not commit adultery; You shall not steal; You shall not bear false witness; You shall not defraud; Honor your father and mother.’” 20He said to him, “Teacher, I have kept all these since my youth.” 21Jesus, looking at him, loved him and said, “You lack one thing; go, sell what you own, and give the money to the poor, and you will have treasure in heaven; then come, follow me.” 22When he heard this, he was shocked and went away grieving, for he had many possessions.
Earlier this week in his column in the New York Times, Nicholas Kristof wrote about an urgent issue that was completely absent from the presidential debate, the growth of income inequality in America.
Kristof began with a parable. He invited readers to “Imagine a kindergarten with 100 students, lavishly supplied with books, crayons and toys.” There is more than enough for everyone, but one little boy has almost all the toys. Nine others each have a few toys, and the remaining 90 children have nothing at all.
One little boy has more toys than all those ninety others combined.
As a responsible adult, you want to correct the situation. “What’s going on?” you ask. “Let’s learn to share! One child shouldn’t hog everything for himself!” But the one with all the toys is unmoved. “I don’t want to share,” he says. “This is America!”
Sadly, the little boy is right. America does in fact look like the kindergarten in Kristof’s parable. The top 1% in the United States has more wealth than the bottom 90% combined. Every time I write that I think it must be wrong. It seems impossible, but it’s true. There are studies that vary slightly in their calculations, but the basic facts hold. And within that top 1% there is a steep increase as you move from the .09% up to the .01% (one in a thousand).
In the present economic “recovery,” 93% of the gains in income went to the top 1%. And last month the Gini coefficient, the standard measure of inequality set a modern record and reached the highest level since the great depression.
Last year scholars from Duke and Harvard conducted a study in which they asked Americans which country they would like to live in, one with income inequality like Sweden’s or one with income inequality like America’s. Turns out that most of us would rather live in Sweden. Of course the researchers didn’t label the countries as America a Sweden. We want to live in a more equal society and we believe that America has a much more equal distribution of wealth than it does.
For Christians, inequality is a moral problem. Kristof, who would not call himself a Christian, is nevertheless closer to the ethics of Jesus than many devout “believers.” He describes our inequality as “unconscionable.” For the past thirty years we have been redistributing income, from the middle and bottom to the top.
Inequality is not just a moral problem; it is also an economic problem. It stifles growth because those at the bottom cannot create the necessary demand for goods and services, and they cannot afford the education to train for the jobs of the future.
The answer is not for the government to play Robin Hood and take money from the top to redistribute at the bottom, but to restore a more progressive tax policy. In the 1950’s, the marginal tax rate on the highest incomes was 90%. It wasn’t until 1987 that the highest tax rate came down to less than 50%. That income could be used for education, job training, and infrastructure, investments that would create jobs and benefit all Americans.