Inequalilty: Is our hottest economic trend an overrated problem?

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The Atlantic
By: Megan McArdle
May 8, 2012

Inequalilty: Is our hottest economic trend an overrated problem?

Income inequality remains remarkably prominent in political and policy debates nearly four-and-a-half years since the start of the Great Recession and less than six months from the consequential 2012 elections. To flesh out this otherwise trite observation, consider what Lexis Nexus says about how often "inequality" has appeared in the national paper of record, The New York Times. During the three years from September 2008 -- when the collapse of Lehman Brothers ushered in the financial crisis -- through August 2011, the Times published one inequality piece every 1.8 days. I wouldn't read too much into this number. I suspect that a more-careful analysis that honed in on prominent articles and columns that were clearly about economic inequality would produce a significantly smaller estimate.

The important thing here is the trend. Before the financial crisis, from the start of 2001 through August of 2008, the Times published an article including "inequality" once every 2.1 days, up from once every 3.2 days during the 1990s and once every 4.8 days over the 1980s. In other words, inequality became an increasingly visible topic in the Times over the long run, a rise that mirrored the increase in inequality over this period.

Beginning in September of last year, however, when Occupy Wall Street penetrated into the public consciousness and when President Obama began adopting a more populist and combative rhetoric and politics, inequality has been a constant presence in the news. From September of last year through last week, the Times included pieces on inequality not once every 1.8 days or even once per day, but 1.5 times per day. If one includes the Times's blogs, that figure goes up to 2.9 times per day. Again, these levels probably overstate how much the Times has run prominent articles on inequality, but since last September, it has published nearly one article or blog post every three days mentioning "inequality" at least five times.*

I'll spend some of my time in my stint as guest blogger the next couple of weeks exploring the topic of inequality--what to make of the basic trends and whether they should generate as much attention and concern as they currently do. I'll also focus on trends in other economic indicators, drawing from analyses I've been doing for the past six years. It was around that time that I was inspired by the work of Jacob Hacker (in ways he surely didn't intend) and of Steve Rose (whose book you should buy) to start looking more deeply into the numbers that are waged as weapons of convenience in daily political debates. These debates generally proceed from worldviews to the selective embrace and citation of evidence that reinforces them. I have to fight off confirmation bias just like everyone else, but I'll try to at least tell you what the alternate arguments are and why I disagree with them.

If you think that economic problems are generally overstated, as I do, you pretty quickly get labeled a conservative. Ideology isn't a terrible thing in and of itself -- moral values related to freedom, equality, fairness, and justice do tend to cluster together in coherent ways that differentiate liberals and conservatives. I worry more about government inefficiency and unintended consequences and less about market failure compared with most liberals, but my views on justice and inequalities of opportunity align more closely with liberals than with conservatives.

But my values and yours should be irrelevant when it comes to establishing what the available data says. It's unfair to peg people ideologically based on their read of evidence. There's better and worse evidence, but we have to do the work of assessing evidence, not make ideological judgments based on the conclusions of this or that commentator. (For those without the time or background to assess empirical claims, a good indicator of seriousness is the extent to which someone addresses the evidence behind counterarguments rather than casting aspersion on the service to which counterarguments are being put.)

What the ideally collected and measured data would say is more contentious and leaves more room for bias to creep in, but it is not difficult to find and assess the evidence cited by people with whom one disagrees. It is reasonable to categorize people ideologically when they won't do this, won't change their views, and won't rigorously explain why they won't. But pegging people simply based on their conclusions says at least as much about the ideology of the person doing the pegging than about the person doing the concluding.

*Times-haters and stats sticklers: I know, I may be saying more about how much the Times cares about inequality than how much a representative sample of newspapers does. This is just a quick-and-dirty for illustration of the broader point that inequality is much newsier than it has been in the past. If the Wall St. Journal cooperated with Lexis Nexus, I'd have looked at the figures for them too. If someone else wants to fight with Factiva, I'd be curious to see the results.

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This page contains a single entry by CFED published on May 9, 2012 4:24 PM.

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