By CoyotePrime (Reporter)
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by Paul Krugman 

“Many influential people have a hard time thinking straight about inequality. Partly, of course, this is because of Upton Sinclair’s dictum: it’s hard for a man to understand something when his salary depends on his not understanding it. Part of it is because even acknowledging that inequality is a real problem implicitly opens the door to taking progressive policies seriously.

But there’s also a factor that, while not entirely independent of the other two, is somewhat distinct; I think of it as the urge to sociologize. I’ve written about that urge in the context of poverty: many pundits and politicians clearly want to believe that poverty is all about dysfunctional families and all that, a view that’s at least 30 years out of date, overtaken by the raw fact of stagnant or declining wages for the bottom third of workers.

There is also a counterpart on the upside of the income distribution: an obvious desire to believe that rising incomes at the top are kind of the obverse of the alleged social problems at the bottom. According to this view, the affluent are affluent because they have done the right things: they’ve gotten college educations, they’ve gotten and stayed married, avoiding illegitimate births, they have a good work ethic, etc.. And implied in all this is that wealth is the reward for virtue, which makes it hard to argue for redistribution.

The trouble with this picture is that it might work for people with incomes of $200,000 or $300,000 a year; it doesn’t work for the one percent, or the 0.1 percent. Yet the bulk of the rise in top income shares is in fact at the very top. Here’s the CBO:

What’s a sociologizer to do? Well, what you see, over and over, is that they find ways to avoid talking about the one percent. They talk about the top quintile, or at most the top 5 percent; this lets them discuss rising incomes at the top as if we were talking about two married lawyers or doctors, not the CEOs and private equity managers who are actually driving the numbers. And this in turn lets them keep the focus on comfortable topics like family structure, and away from uncomfortable topics like runaway finance and the corruption of our politics by great wealth.

This is, by the way, why the Occupy slogan about the one percent is so brilliant. I would actually argue that the number should be even smaller. But one percent is an easy to remember number, and small enough to make it clear that we’re not talking about the upper middle class. And that’s good. The myth of the deserving rich is, in its own way, as destructive as the myth of the undeserving poor.”

- http://krugman.blogs.nytimes.com/

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