John McClaughry: The Debate Over Income Inequality

The Impact of Inequality on Sustainable Development Goals (SDGs)

Introduction

The issue of “Inequality” has long been a focal point for advocates of socialism. In 2013, the publication of “Capital in the Twenty First Century” by French economist Thomas Piketty sparked a new wave of debate. This title was inspired by Karl Marx’s influential work, “Capital,” published in three volumes between 1867 and 1894.

Senator Bernie Sanders, a proud socialist, has consistently spoken out against income inequality throughout his adult life. In 2015, while running for the Democratic Party’s presidential nomination (despite not officially joining the party), Bernie emphasized that “the most important issue facing the American people is the grotesque level of income and wealth inequality.” His speeches often call for the government to address this inequality by ensuring that the wealthy pay their “fair share,” although he has not provided a clear definition of what constitutes a “fair share.”

The debate following Piketty’s book saw heated arguments between socialist and free-market economists. One significant counterargument highlighted Piketty’s focus on “income inequality” without considering the impact of government transfer payments and taxation on income reduction.

Phil Gramm’s Contribution

Phil Gramm, a former economics professor at Texas A&M University and a 23-year veteran of Congress who chaired the Senate Banking Committee, has now entered the debate to settle the issue in the United States. Gramm collaborated with renowned experts in U.S. economic statistics, Robert Ekelund and John Early, to analyze the official economic data compiled by the Census Bureau and the Bureau of Labor Statistics. Their goal was to determine the extent of income inequality in the U.S. economy. However, they encountered a lack of agreement in the data provided by these agencies.

Conclusion

The issue of income inequality remains a significant concern for policymakers and economists alike. Achieving the Sustainable Development Goals (SDGs) requires addressing this challenge. By understanding the complexities of income distribution and considering the impact of government policies, we can work towards creating a more equitable society.

SDGs, Targets, and Indicators Analysis

1. Which SDGs are addressed or connected to the issues highlighted in the article?

• SDG 10: Reduced Inequalities

The article discusses the issue of income and wealth inequality, which is directly connected to SDG 10 – Reduced Inequalities. The article highlights the debate surrounding income inequality and the different perspectives on how to address it.

2. What specific targets under those SDGs can be identified based on the article’s content?

• Target 10.1: By 2030, progressively achieve and sustain income growth of the bottom 40% of the population at a rate higher than the national average.
• Target 10.4: Adopt policies, especially fiscal, wage, and social protection policies, and progressively achieve greater equality.

The article mentions the debate surrounding income inequality and the need to address it through government policies. These targets specifically address the need to achieve income growth for the bottom 40% of the population and adopt policies to achieve greater equality.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

• Indicator 10.1.1: Growth rates of household expenditure or income per capita among the bottom 40% of the population and the total population.
• Indicator 10.4.1: Labour share of GDP, comprising wages and social protection transfers.

The article mentions the need to analyze economic data compiled by the Census Bureau and the Bureau of Labor Statistics to determine the extent of income inequality. These indicators can be used to measure progress towards the identified targets by examining the growth rates of household expenditure or income for the bottom 40% of the population and analyzing the labor share of GDP.

SDGs, Targets, and Indicators Table

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Source: caledonianrecord.com

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