Tim Noah buries the lede: Arguing that government policy can too affect income distribution, TNR‘s Tim Noah writes:
If you omit government redistribution from the calculations in the previous paragraph then four countries that previously were more equal in incomes than the U.S.—Portugal, Italy, Israel, and Germany—become less equal than the U.S.
Wait. You mean that social-democratic, union-heavy, solidaristic Germany has worse income inequality, before taxes and transfers, than the cowboy capitalistic U.S., with its large underclass and out-of-control Wall Street greedheads? Don’t tell the narrative. …
Update: Noah tweets, re Germany economy being more unequal than ours:
“It isn’t usually, but it seems to have become so since the recession hit. Don’t know why.”
But according to the OECD chart Noah cites, Germany had passed the U.S., inequality wise, by the mid-2000s, well before the recent recession. Maybe the stats Noah relies on don’t capture what people like him think is important, in which case they shouldn’t be relied on so often. Or maybe the narrative needs some rejiggering. … P.S.: The obvious explanation–the disparities involved in absorbing East Germany–wouldn’t seem to account for a trend that flowered in the mid-2000s. …