As we are waiting for the annual SOTU, a lot of speculations are going around and Barack Obama is probably going to address income inequality in his 5th State of the Union Speech.
It is well known that under Obama Presidency income inequality has worsened, but I just want to remind you a couple of significant numbers.
How income inequality is measured
Income inequality is measured confronting the difference between America’s median and average wages. If average goes up faster than the median, it means income inequality is worsening, otherwise it's getting better.
Bush vs Obama
Under Bush Presidency income inequality has grown at a rate of 0.28, on the contrary Obama's policies have increased the rate to an alarming rate of 1.14, four times higher!
What to do
Obama's speech is going to be pure rhetoric, but nevertheless income inequality in the USA is the worst in the developed world so something has to be done. Once again I want to mention a famous quote from William Boetcker's 'The Ten Cannots':
You cannot bring about prosperity by discouraging thrift.
You cannot strengthen the weak by weakening the strong.
You cannot help little men by tearing down big men.
You cannot lift the wage earner by pulling down the wage payer.
You cannot help the poor by destroying the rich.
You cannot establish sound security on borrowed money.
You cannot further the brotherhood of man by inciting class hatred.
You cannot keep out of trouble by spending more than you earn.
You cannot build character and courage by destroying men's initiative and independence.
And you cannot help men permanently by doing for them what they can and should do for themselves.
It is important to focus on creating wealth, to make people getting out of poverty. You cannot fight income inequality just by increasing taxes and spreading wealth. People must be given the opportunity to be successful and create wealth on their own.