Income inequality? Conservatives say it’s not happening. Libertarians don’t care. Sadly, Reason Editor-in-Chief Nick Gillespie bucks the trend, seeming to have no problem with deliberate misrepresentation.

Predictably, Gillespie dismisses concern for the financial security of the middle-class as mere politicking. While this may be true to some extent, a closer look at his evidence reveals selectivity and misdirection. He cherry-picks a few self-fulfilling statistics, failing to recognize the inevitably more complex nature of these economic issues, and ignores more pertinent indicators of economic mobility and security.

-          Responding to claims that income inequality is widening, Gillespie admits that the rich are getting richer, but then points to Census data showing that each income group is becoming wealthier. What matters, however, is not income growth itself, but relative rates of income growth. This Census table paints a more accurate picture: the share of aggregate income for the bottom 80% of Americans has declined over the past 30 years. The income levels accessible to the vast majority of Americans clearly do not correspond to the same status within the national economy as they once did.

-          Gillespie points out a study showing that overall economic mobility has not changed much over past decades, that roughly the same percentage of Americans change income quintiles. Underneath this aggregate measure is evidence that mobility no longer means what it once did. A larger percentage stays in the same quintile, while a smaller percentage moves up or down by two quintiles. Furthermore, except for those who enter the fifth quintile, moving up by one quintile no longer corresponds to the same increase in purchasing power.

-          Gillespie notes that more Americans than ever before own homes. There is a flipside, however. With housing especially, the value of these assets is less impressive when debt is taken into account. Though all income groups have increased debt as a percentage of income, the trend is more pronounced with lower income levels. In fact, middle-income families devote the highest percentage of their income to debt payment. Further more, these middle-class homes, as a larger percentage of total assets, make net worth less liquid than in the past.

-          Finally, though it is encouraging that more Americans go on to college, we here at CampusProgress don’t need to rehash that, despite becoming an increasingly important component of upward mobility, obstacles to higher education are mounting.

 
Of course, if libertarians couldn’t engage in gross over-simplification of economics, they wouldn’t have much to go on, would they?