The End of Growth

Economic Scene - Obama’s Budget Plan Sweeps Away Reagan Ideas - NYTimes.com

Remember the 70's? If not, no matter, you are going to get to live at least that level of want again, if not the 30's. Why? Because ideas are important, but reality is even more important. The "genie" that improves all lives is GROWTH, and "income" is just one small part of that improvement. There are lies, damn lies and statistics, and while statistics are a useful tool, they ought to be looked at as being as dangerous as firearms. Guns are fine, but if someone is explicitly using one to do harm, they are very bad indeed. That is pretty much what this article is doing with statistics.

As a result, the average post-tax income of the top 1 percent of
households has jumped by roughly $1 million since 1979, adjusted for
inflation, to $1.4 million. Pay for most families has risen only
slightly faster than inflation.

Before becoming Mr. Obama’s top economic adviser, Lawrence H. Summers
liked to tell a hypothetical story to distill the trend. The increase
in inequality, Mr. Summers would say, meant that each family in the
bottom 80 percent of the income distribution was effectively sending a
$10,000 check, every year, to the top 1 percent of earners.

This kind of thinking from an economist who is now a top economic adviser is like having his top medical advisor announce that evil spirits cause disease. This is envy incarnate and frightenly wrong! The bottom 80% didn't send ANY check, in fact, the bottom 50% paid nearly NOTHING in income taxes! The income of BOTH groups went up because of GROWTH!!!

Mr Summers HAS to realize that, so his story is a bold faced lie of the most obnoxious kind. What kinds of "income growth" does he expect in a country that is CONTRACTING at 6% a quarter??? Well, he better expect NONE -- in fact, the top will fall faster than 6% and the bottom will approximate the 6% decline, so yes, it reduces "income inequality", but at the expense of everyone having FAR less.

In the past 30 years, neither Europe or Japan has achieved "income growth slightly faster than inflation" for the bulk of it's population. The fact that a country of 300 Million has been able to do is AMAZING!!

This has to rank on my new list of the scariest things I've read in the "past month". To not understand that is has been growth that has driven all the good things of the last 30 years for this country and we have now turned to naked redistibution and forgotten the advantages of growth is extremely sad for all Americans.