One of the main complaints of Occupy Wall Street is of income disparity in the US and the world. This is an idea rooted in economic misconceptions about capitalism which is endemic in our society. That is, there is a finite amount of wealth and the one percenters have most of it and that’s unfair. Therefore they can justify social policies which redistribute wealth. As we all know capitalism creates wealth and it is the one percenters who do most of that which is why they are one percenters.
On the other hand the whole idea of crony capitalism is not “capitalism” at all, rather it is a form of state facilitated enterprise that relies on government support to stay in business. This has gone under many names over the years: crony capitalism, national corporatism, mercantilism, oligarchy or plutocracy, dirigisme, and fascism. Crony “capitalism” in the form of bailouts is a form of wealth redistribution which is fair game for criticism. (I view quantitative easing as a form of crony capitalism in that fiat money printing favors the same companies that were bailed out.)
I just came across this data about income distribution in America (thanks to Cafe Hayek) from PoliticalCalculations.com. They poke some big holes in the inequality theory with The Gini Coefficient of wealth distribution:
Perhaps the most common measure of income inequality in a nation is the Gini Coefficient (aka the “Gini Ratio”), which ranks the amount of inequality there is in a country on a scale from 0, which represents perfect equality, where everyone would have an equal share of the nation’s income, to a value of 1, which represents perfect inequality, where one person would have all the income, but everyone else has none.
Their research shows that “there has been absolutely no significant change in the level of inequality among U.S. individual income earners from 1994 through 2010 …”:
This shows that so-called income distribution “disparity” has been remarkably stable for the past 16 years which is contrary to what the OWSers are claiming. Political Calculations has some other observations about the data that are an interesting read, “The Real Story Behind ‘Rising’ US Income Inequality“. For those of you who want to know more about the Gini Coefficient, there is an excellent article here that explains it quite well.