Saturday, November 08, 2008

I Dream of Gini

The ruling class and their sycophants among the media and scattered among the population are nervous about Obama. His election has caused an uproar in their delicate nervous systems, but I don't think they have anything to worry about.

Obama has already signaled that he's willing to engage in an elaborate balancing act. Remember, he wants everybody to get along and love each other, and that pretty much puts the kaibosh on the possibility of class warfare, unless some members of the ruling class really nut up and order their goons to start kicking ass and taking names, as they did in Denver and Minneapolis.

How can we tell whether a society is fair and equitable? I know there are some people who think I'm a crazed Marxist for even suggesting that there is such a thing as a predatory ruling class in this country. However, the numbers prove that just such a group of our fellow citizens exists among us.

The Gini Coefficient is a useful little statistic. It's a measure of income inequality within a society, invented by an Italian statistician, Corrado Gini, in 1912.

It works like this: If the society whose income inequality you want to measure consists of two families, and one of the families has nothing and the other has everything, its Gini Coefficient is 1. If family A has 25 percent of the wealth and family B has 75 percent of it, then the Gini Coefficient is .75.

Historically, the Gini Coefficient in this country grew smaller between the time of the Great Depression and the end of Jimmy Carter's administration, as the tendency during the New Deal and its aftermath was toward greater degrees of income equality.

For example: 1950 -- the bottom quintile of American income earners gets 4.5 percent of all income, middle quintile gets 17.4, top quintile gets 42.7 -- Gini Coefficient is .379.

In 1960 it's .364, and in 1970 .353.

The inequality reflected by the Gini Coefficient starts increasing again during Carter's last year in office (1980), rising that year to 1964 levels, then goes to .396 in 1990.

In 2000, at the end of the Clinton Years, the quintile income breakdown is bottom, 3.6%; second, 8.9%; middle, 14.9%; fourth, 23%; top, 49.8%, with the top one percent of income earners making 22.1% of the country's total income from all sources. The Gini Coefficient for that year is .43.

I wish I could find the Census Bureau website again, from which I originally copied these figures.

Since 2000, reflecting the ruling class's iron grip on the political process via its agents in the Bush regime, the Gini has crept up even further; in 2005 it hit .469, and in 2006, .47, the highest index ever reported. In 2007 it dropped a bit, to .463, as a result of the busting of the housing bubble and the consequent losses due to foreclosures and the sudden revelation of the major swindle formerly known as the derivatives market, and known today as "the meltdown."

This is unacceptable for a modern, industrialized country, and it's going to change. Compare our Gini with those of European nations and the raw injustice and gross deformity of the U.S.'s income inequality stands out in bold relief. The U.K.'s Gini is .34; in France it's .28; Norway's is likewise .28.

A country with a Gini as high as ours is more like a third-world society, in which a bunch of peasants who are rapidly transforming themselves into an impoverishd, slum-dwelling urban proletariat are ruled and robbed from behind high walls by a blue-blood aristocracy.

This is the path we've been on, and we need to put an end to it.


Joe said...

I read that Warren Buffet said that the rich class is winning the class war.

Dave B, a.k.a. catboxer said...

He sure did, but he's not happy about it.

Buffet is the exception that proves the rule -- a billionaire I admire and respect.