Income Inequality: Obama's Poor Solutions

Democrats' crass obsession with income inequality will be on full display this week when President Obama unveils his administration's major initiatives in his State of the Union address. A dominant theme will be how the rich have become too wealthy at the expense of the poor.

Although it's a feckless premise, Obama understands his thesis will appeal to the uneducated, envious, naive and guilt-ridden.  The audacity of Obama's claims are breathtaking, considering his policies have widened the yawning chasm between the rich and poor.

The Census Bureau recently issued a report which indisputably shows that income inequality under Obama has reached its highest level since the agency began recording data in 1947. Since 2009, the bottom 90 percent of earners' share of total income has dipped below 50 percent for the first time in American history.

But that won't stop the politically motivated president from railing against greed, racism and unfairness as the deep-rooted causes of the wealth gap.  He will demand that Congress address inequality by raising the minimum wage, extending unemployment benefits and hiking taxes on the wealthy.

There is only one problem with the narcissistic president's simplistic approach.  None of his proposed remedies will narrow the gap between the rich and poor.  That is because his solutions have nothing to do with the social and economic drivers which have exaggerated the pay disparity.

Instead of trying to inflame class warfare, the president could learn something by studying testimony from the Brookings Institute to the U.S. Joint Economic Committee, a bipartisan group of the House and Senate.  The presentation entitled, "Income Inequality in the United States," was delivered January 16.

For the record, Brookings is a nonpartisan think-tank ranked in some quarters as the most influential in the world.  Headquartered in Washington, D.C., Brookings normally leans liberal or centrist in its approach.  It certainly is not some rawboned conservative outfit.

In her testimony, senior Brooking fellow Melissa Schettini Kearney, makes three key observations based on research about the phenomenon of growing income inequality in the United States:

1.  Inequality over recent decades is largely the "result of structural changes in the labor market that have favored the highly skilled."  The gaps in wages and employment opportunities are greatest among those with college education versus those with less schooling.  In other words, a majority of opportunities require college educated workers, leaving only the lowest-paying jobs for the uneducated.

2.  Income inequality can be traced to the "sizable gaps in education achievement between the children of the rich and the poor." The fact is children of wealthy families also enjoy greater advantages because of their access to the best schools, starting with pre-school and extending through college. The growing gap in education performance "is not the result of eroding support for public education," according to the report. School performance is often linked to a two-parent household.

3.  Economic despair and marginalization can lead individuals "to simply drop out of the mainstream climb to economic success."  What this means is that people "do not see promising opportunities and so they essentially give up."  Their environment, their location and their lack of skills make even middle class seem to be a goal too far, so they choose the path of least resistance.

These findings were based on decades of research by Brookings. Solutions to the problems identified in the investigation defy quick fixes.  Unfortunately, the illusion of an immediate solution makes President Obama's politically expedient measures so seductive to the pseudo-compassionate.

Those serious about addressing economic disparity are not interested in more platitudes from a president who wants to exploit class warfare for political benefit.  His approach will divide the nation, not unite Americans to support long-term solutions that could actually shrink the gap between rich and poor.