Meaningless Denial

Much that I admire our government for all the great things it has done what irate me is its readiness to jump in defence even at the slightest remark or suggestion by any netizen. One guy wrote in the paper's forum page alluding to the fact that the "Growing pie does not mean bigger slices for all" and that middle class income has stagnated while the real wages of the lower income had declined. True to its known efficiency the MOM replied with statistics that showed that real incomes in the bottom 20 per cent grew by 3.1% p.a. over the last 10 years (on a per household member basis) and in fact it grew a little faster than the top 20% (2.5% p.a).

Hello 2.5% on say $200k is $5,000 p.a while 3.1% on say $20k is $620 p.a not mentioning the compounding effect if such excesses of the top 20 earners is saved and invested. I am also quite wary of how the govie juggles statistics to prove a point. Having personally experienced how statistics was massaged for various purposes (eg. duration and top/bottom percentiles), I question the basis of "per household member " and the 20 % instead of top 10% etc.

Truly the writer to the forum is concerned about the the inequality in our society and how it affects social mobility of the lower income families. That is the essence of his message but MOM chooses the narrow approach defending with statistics on income. Don't we all know that wealth is in the asset classes and also in passive income like capital gain and dividends which is not even required to be declared in income tax assessment as it is exempt from taxes.

Ell Broad who started 2 Fortune 500 companies and who turned to full time philanthropy opined that "no amount of philanthropic commitment will compensate the deep inequities" in the US short of some forms of wealth tax like capital gain tax , higher income tax and inheritance tax. He opined that policies like raising the minimum wages, reforming the education system , building affordable housing and expanding healthcare will not addressed this crisis adequately.

I think it's time our government wrestles this issue carefully instead of being jumpy and kicking the can down the road. Its a grave problem and netizens know it and are content with an assurance it is being weighed on instead of some simplistic meaningless denial.