Many serious people think economic inequality in the United States and other developed economies should be a hot political topic. But the general public hardly cares. There is a bad reason behind lack of public interest.
President Barack Obama said last December that a “dangerous and growing inequality” is “the defining issue of our time,” but the most recent Gallup poll suggests that view is not widely shared. Only 3 percent of Americans chose the “gap between rich and poor” as the country’s “most important problem” and 4 percent went for poverty. Unemployment scored 19 percent.
The American indifference is surprising because the measured increase in inequality there has been relatively large by international standards, to judge from the recent Chartbook of Economic Inequality from the Institute for New Economic Thinking at the Oxford Martin School. But the lack of concern is widespread. Neither help-the-poor nor soak-the-rich politicians have gained much traction in any rich country.
Debilitating economic inequality is in fact diminishing on a planetary scale. Each year, fewer people have to live without the basic economic goods of adequate food, clean water, decent housing and clothing, electricity and so forth. More people are experiencing a middle-class lifestyle. Almost every year, the gap between average incomes in developing and developed countries narrows.
However, the Chartbook shows that income and wealth are both increasingly concentrated at the top of society in countries from Canada to Germany. Why is the rest of the population not burning with indignation? The best explanation is that the statistics are misleading. In developed economies, actual consumption is not becoming more unequal to the degree suggested by most widely cited measures.