Income inequality is not a bad thing

What follows is a rebuttal of Con's arguments.Con argues that income inequality has harmful effects on society, and among these he lists: low life expectancy, mental illness, obesity, dead children, and low academic achievement. Some of these things are unrelated to the distribution of income (mental illness is mostly genetic [1]; obesity is at least partially genetic [2]; academic achievement is the result of a failing public school system [3]), while others are a consequence of poverty. It is important that we distinguish between poverty and income inequality, because these are not the same problem. Some countries have high income inequality and low poverty rates (United States, Gini 45; poverty rate 16%) while others have low income inequality and high levels of poverty (Ethiopia, Gini 30; poverty rate 29%.) Also note that poverty is defined differently in different countries, so that the "poor" in the United States are nothing like the poor in Ethiopia. The American "poor" is made up of people who own all the basic appliances (refrigerator, microwave oven, TV) and 70% own at least one car, while the poor in Ethiopia don't have access to electricity or potable water.Poverty indeed has a positive correlation to infant mortality, low life expectancy and many other ills. But there is no correlation between poverty and income inequality. I searched for such evidence in the links provided by Con but found only the main page of an advocacy organization called United for a Fair Economy. In fact, according to this study published in Bonn, Germany, globalization simultaneously increases income inequality AND reduces poverty [3]. This can be observed most evidently in China, a country which has enjoyed tremendous growth in the past 30 years, pulling hundreds of millions out of poverty, yet at the same time has seen income inequality skyrocket [4]. Another study shows that "empirically, baseline estimations and a sensitivity analysis show that income inequality is positively, and most of the time significantly, associated with economic growth." [5] Con's case is blaming poverty's harmful effects on income inequality, yet he has presented no evidence tying poverty with income inequality. On the other hand, I have provided evidence that shows that higher income inequality is positively correlated with economic growth and negatively correlated with poverty. As for Robert Reich's opinion about the importance of the middle class, I don't think it's relevant to our discussion. The stratification of society in classes (lower, middle, upper) is a political artifice with little economic meaning. The "middle class" can be defined as narrowly or a widely as one wishes. If the distribution of income in a society widens (the bell curve flattens), then fixed lower and upper limits of income necessarily will indicate that the middle class is shrinking, but only because some people have moved below or above these arbitrary limits. One could just as easily widen the range of incomes that define the middle class and get a "growing" middle class. I think it's much more important to see if the bell curve is moving to the right or to the left —that is, whether the median income is rising or falling.Finally, Con argues that income inequality is undemocratic. Con defines democracy as "power and opportunity broadly shared, where no one's power or station in life are determined by accident of birth." I don't think this is the standard definition of democracy, but for the sake of argument let's say it's correct. His argument is still irrelevant to the resolution that income inequality is an essential feature of a free society. In a free society, some people make a lot of money without "deserving" it, sometimes by an accident of birth and sometimes because they won the lottery. Democracy has nothing to do with it. [1] http://www.minddisorders.com...[2] http://ajcn.nutrition.org...; [3] http://ftp.iza.org...[4] http://www.aljazeera.com...;[5] http://onlinelibrary.wiley.com...;