Americans Want Income Equality

Despite all the rhetoric out there about free markets and entrepreneurship and meritocracy and winners getting just rewards, results from a new survey (done by a professor at Harvard Business School, the fountainhead of free enterprise) show that Americans actually want a more equal distribution of wealth. Moreover, it turns out that most Americans have no idea how unequally wealth is currently distributed.

I posted recently about Timothy Noah’s long piece on income inequality; now he summarizes the results of the aforementioned survey. The survey shows that Americans generally think that the richest 20% of us own 60% of the wealth. In reality, the richest 20% own 85%. The survey also reveals that when shown graphs illustrating America’s income distribution, Sweden’s income distribution and an equal distribution, most American’s chose the Swedish graph. The equal graph was second, and the actual American graph came last.

Or, look at this graph from the survey (hat tip to Baseline Scenario for pulling the graph from the original pdf):

American's ideal wealth distribution

Americans very clearly want a more equal distribution of wealth than they have now. They aren’t agitating for it because A) they have no idea how unequal things really are; and B) there is an aspirational optimism in Americans whereby they always think that they will end up at the top.  But the next time some Tea Partier or Fox pundit starts talking about how Americans love the current system and are totally OK with hedge fund managers making $1 billion per year, remember this graph.

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