Highest caution is offered
In response to my short stucco for inequality, a reader (thanks for that!) The editorial from the mirror of 11. Marz sent. The staffed, the wonder, also with the inequality – I had already believed that the editor-in-chief have phoned. Also in the article Marcel Fratzscher is excellent to speak. In the incorporation, the article confirmed exactly what I suspected.
The whole reasoning runs according to the motto: After the policy wanted and unbelievable "successful" Inequality has created millions of jobs, we now have to lubricate the people very fast thick fabrics ointment on the wound, so it stops the flap. Speaking in the mirror: "The Hartz reforms were right to bring millions of unemployed in jobs. Now it should be about transforming many precare mini jobs and fragile workmanship again in regular business constraints, with merit beyond the minimum wage."
Then comes exactly the reasoning that is always used to sprinkle the stupid people sand into the eyes. In the mirror it is called:
Because rich put a coarse portion of their income to the high edge, the economy can get out of balance if the income is too high on the upper layers. It is then too much saved in the economy, the factories of consumer manufacturers are not busy, and too much capital flees abroad, because within their own boundaries do not offer investment opportunities. That’s exactly how the German economy was braked over long years, many professionals are convinced. In the first decade of the new century, consumption grew only about half as fast as the social product.
Is not that ingenious? That sounds tremendously obvious, or? We only had less inequality in income distribution, already gave it more growth and more jobs. Because it is empirically clearly proven that in the lower income layers the savings inclination is lower than in the upper: from a monetary unit who earns someone out of the middle class, more is spent than a monetary unit that earns someone in the upper class. And that’s the problem before which we stand that too much is saved and too little in demand, right?
If one thinks for a moment, but there are a doubt. Why does the mirror only refers to the different savings rates of the income layers when he speaks about the relation of arm to rich? He did not have to say something about the overall income of both groups themselves?
That given Income The consumer demand is gross if the income distribution is more in favor of the income statements with the higher consumption tendency (or. The lower savings rate) has failed as in favor of the other group, is indeed not complicated, but a simple coating that does not require a grip beyond the knowledge of the principles.
The question is only: Is the income of the different groups specified or given. How did it come?? There is enough for a distribution in favor of the lower income layers to cope with growth, or do you need a very different policy?
In the case of a redistribution of the companies, each entrepreneur, but also every neoclassic, was immediately contradictory and refer to the investment demand, which was polled by a redistribution away from the profits to the lews.
Since the investment demand is also part of the total demand, – according to the argument – a redistribution at the expense of income income in the total medium to long term has been charitable, because they detach the property investors. Thus, in the course of the workplace after a short straw fire of consumer demand, nothing was won in the long term, which more damage caused by the loss of confidence in the Sachinvestors even more damage than without straw fire.
Deputy war and a deficit
That’s why there is not this quarrel at all. One leads a deputy war to avoid the actual dispute to which it is about to avoid. Let’s take a closer look. If you are always speaking of the middle class, from the less verify here and the rich there (ie from the personnel Income distribution). One does not speak like the right neoclassics from the payroll members and profit income earners (ie the functional Income distribution).
Although both views have a rough intersection – many profit income recipients belonged to the rich, many dependenced employees to the less enclosed. But you avoid the plate distinction between workers and entrepreneurs. why? Because then the question of how it could lead to the defendant inequality was very fast on leaning? Because then they had to confess color whether under the reduction of inequality mainly the change of secondary distribution by the state understands or the change in primary distribution?
The decisive mistake of the argument in the mirror is that it does not explain how the imbalances arose in the income. But whoever does not appeal to the cause, has no solution. And there comes the vulnerability of the reasoning of the entire ruling teaching about the inequality: on the way to the imbalance is the average savings rate by no means risen continuously (neither in the US nor z.B. in Germany).
But she had had to do that if the cause for the growth weakness and the unstability of the market economy should fundamentally have something to do with the different savings rates of the various income statements. Such an explanation must namely, the advice to overwind the growth weakness with the help of a lower domesticity, which one wants to achieve that one ensures that more effects, which are measured by their income,.
But if it did not sit on the way to the imbalance on the savings quota of the income layers, what was the cause then? It was the income development itself! The incomes of workers have not risen over many years, because they believed to eliminate unemployment on the decoupling of workers’ income, as well as the mirror it suggests.