Welfare - Poverty Category. Something to think about. Parks & zoos in this country usually have signs that ask us "Please Do Not Feed the Animals." The stated reason for this policy is because "The animals will grow dependent on handouts and will not learn to take care of themselves."

Reassessing the Facts about Inequality, Poverty, and Redistribution

by John F. Early,
from CATO Institute,

Many U.S. politicians are promoting policies to reduce income inequality and poverty by increasing taxes and transferring more income to lower-income households. These proposals rest in part on claims that income inequality in the United States is greater than that in other Western democracies and is growing, and that poverty persists at high levels.

The usual statistics invoked to support those claims, however, are misleading. Those statistics exclude about $1 trillion in annual transfer payments to lower-income households and do not account for the effects of taxes. When those transfers and tax effects are included, income inequality in the United States is lower than that in many Western democracies and has grown at rates similar to income inequality in other nations. Improved estimates of poverty show that only about 2 percent of today’s population lives in poverty, well below the 11 percent to 15 percent that has been reported during the past five decades. The estimates of inequality and poverty developed here do not, by themselves, determine whether existing redistribution is excessive or insufficient. They do show that the claims of proponents that the current situation is severe and growing worse are exaggerated or inaccurate.

More From CATO Institute:

365 Days Page
Comment ( 0 )