Economic Inequality: It’s Far Worse Than You Think
The great divide between our beliefs, our ideals, and reality
March 31, 2015 |By Nicholas Fitz

In their 2011 paper, Michael Norton and Dan Ariely analyzed beliefs about wealth inequality. They asked more than 5,000 Americans to guess the percentage of wealth (i.e., savings, property, stocks, etc., minus debts) owned by each fifth of the population. Next, they asked people to construct their ideal distributions. Imagine a pizza of all the wealth in the United States. What percentage of that pizza belongs to the top 20% of Americans? How big of a slice does the bottom 40% have? In an ideal world, how much should they have?

The average American believes that the richest fifth own 59% of the wealth and that the bottom 40% own 9%. The reality is strikingly different. The top 20% of US households own more than 84% of the wealth, and the bottom 40% combine for a paltry 0.3%. The Walton family, for example, has more wealth than 42% of American families combined.

We don’t want to live like this. In our ideal distribution, the top quintile owns 32% and the bottom two quintiles own 25%. As the journalist Chrystia Freeland put it, “Americans actually live in Russia, although they think they live in Sweden. And they would like to live on a kibbutz.” Norton and Ariely found a surprising level of consensus: everyone — even Republicans and the wealthy—wants a more equal distribution of wealth than the status quo.

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n a study published last year, Norton and Sorapop Kiatpongsan used a similar approach to assess perceptions of income inequality. They asked about 55,000 people from 40 countries to estimate how much corporate CEOs and unskilled workers earned. Then they asked people how much CEOs and workers should earn. The median American estimated that the CEO-to-worker pay-ratio was 30-to-1, and that ideally, it’d be 7-to-1. The reality? 354-to-1. Fifty years ago, it was 20-to-1. Again, the patterns were the same for all subgroups, regardless of age, education, political affiliation, or opinion on inequality and pay. “In sum,” the researchers concluded, “respondents underestimate actual pay gaps, and their ideal pay gaps are even further from reality than those underestimates.”

On March 25, 2015, former editor of the Waukesha Freeman and conservative Pete Kennedy published an opinion piece in the paper urging Wisconsin conservatives to not only reject Scott Walker, but to hold him accountable for the damage he has done to the state.

cantstandusKennedy is not the only Wisconsin Republican abandoning Scott Walker. Recently extremists in the party, including Rep. Robin Vos (R-63) and Sen. Tom Tiffany (R-12), began questioning Walker’s latest budget, which drastically cuts money for public education, eliminates essential programs for the disabled and elderly that allow them to stay in their homes, increases bonding for transportation and roads, and slashes $300 million from the UW System.

Even Walker’s staunch defender Wisconsin Reporter is remaining silent about recent information that has emerged about Walker’s alleged $1.5 million pay-to-play scheme involving Menards’ president John Menard Jr.

Kennedy’s piece vividly describes how Walker has indeed betrayed even his loyal extremists. Kennedy appears to understand that Walker has been lying to them (and the rest of the state) all along. “Given recent events, I’m not convinced he ever really loved you,” he opines, “but if believing so makes you feel better, then by all means do so.”

A progressive advocacy group told state lawmakers Thursday that they could avoid deep budget cuts to the University of Wisconsin System and public schools if they accept federal money to expand Medicaid.

During a public hearing at Reedsburg High School, Citizen Action's Anna Dvorak told the Legislature's Joint Finance Committee that referendum after referendum showed the public supported the move. “When you go back to Madison, I imagine that you have many difficult choices to make,” Dvorak said. “Taking the money is not one of them.”

The nonpartisan Legislative Fiscal Bureau says Wisconsin could save as much as $345 million in state tax dollars by expanding Medicaid.

While Republicans in other states have warmed to the idea, it's been a political non-starter in Wisconsin, where GOP leaders say there's no guarantee the money will be there in future budgets.

The bank robber who gunned down a state trooper Tuesday in Fond du Lac was involved nearly 20 years ago in a skinhead brawl in which he was among those arrested with "white power" paraphernalia, court records show. Steven Timothy Snyder, 38, was charged and convicted of misdemeanor disorderly conduct in the 1996 incident, which also occurred in Fond du Lac, though Snyder is from Michigan. He was sentenced to 50 days in jail.

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In April 1996, Snyder was involved in a bloody fight involving pipes and baseball bats between a group of "skinheads" and another group of "blacks and Hispanics," according to the criminal complaint, which lists Snyder's residence as Macomb Township, Mich.

"Snyder was dressed in white power clothing, including black boots and iron cross paraphernalia," the criminal complaint said. "He had several white power tattoos on his body and in his coat were several dozen small printed cards promoting the 'National Alliance.'"

Information from Fond du Lac police included in the complaint said those cards included statements such as, "No multiracial society is a healthy society — that if the white race is to survive we must unite our people on the basis of common blood, organize them within a progressive social order, and inspire them with a common set of ideals."

Unemployment among African-Americans in Wisconsin last year was the highest of any of the 50 states, according to a study released Thursday by the center-left Economic Policy Institute in Washington, D.C.

At 19.9% — or 1 in 5 working-age people — the black unemployment rate in Wisconsin is nearly three times higher than the highest state white unemployment rate (7% in Nevada) and significantly higher than the national black unemployment rate of 11%, the think tank found.

Wisconsin's black unemployment rate is twice the overall national unemployment rate at the peak of the recession — 9.9% in the fourth quarter of 2009.

The findings are consistent with more than a decade of statistics and studies that show that African-Americans in Wisconsin and its largest city, Milwaukee, often find themselves at the economic and social extremes compared with the rest of the nation. That has been the case with a broad range of social distress indicators, from infant mortality and poverty to high school dropouts and incarceration.

The saga of Florida’s ban of the “C-words” climate change is just getting ridiculous. “Even as Florida Governor Rick Scott denies reports of an unwritten policy banning administration officials from using the term ‘climate change,’ an employee of the Florida Department of Environmental Protection says he was suspended for expressing his views on climate change,” reports MSNBC’s Chris Hayes. The Florida official, Bart Bibler, joins Hayes on his show All In With Chris Hayes to tell his story.

Also included in the segment, Gov. Rick Scott’s chief of emergency management, Bryan Koon, testified before the state legislature and refused to say the “C-words” during a state Senate hearing last week. State Sen. Jeff Clemens (D) asked Koon about FEMA requirements, which mandate that states have a “climate change plan” in order to receive preparedness dollars—a totally reasonable thing to talk about with the state’s chief of emergency management given the expected impacts on Florida from climate change. The interaction at the Senate hearing is a bit like watching the older kid trying to get the younger kid to say a bad word. Watch as lawmakers and the audience actually laugh out loud at the Scott administration official who just refuses to say that naughty term: