Acton Institute Powerblog

Why Social Mobility Matters—and Income Inequality Does Not

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income-inequalityWhen it comes to household income, progressives tend to start with their intuitive understanding of fairness (i.e., some people have a lot more income than others), move to the solution (redistribution of income and wealth from those who have more to those who have less), and only then to develop a metric that justifies implementing their solution: income inequality.

Because of this roundabout approach, you rarely hear progressives argue that income inequality is a problem since for them it just is an injustice — and that wealth redistribution is the primary solution. When conservatives and libertarians disagree about whether it even is an issue we should be concerned with, we are considered heart-hearted apologists for an immoral capitalist system.

The truth, however, is that we don’t care about income inequality because relative differences in income tell us nothing about fairness or the just distribution of wealth. What we care about — what everyone should care about — is whether people have adequate opportunities to increase their household’s income, and hence, improve their standard of living. While there is no truly adequate gauge to measure such opportunities, we can get a fair estimate based on measurements of social mobility.

Social mobility is the ability of an individual or family to improve (or lower) their economic status. Since it is often measured in income, it is also called income mobility or economic mobility. (I prefer the term “social mobility” because increases in status can often be more important than income as a gauge of one’s standard of living. For instance, a person may make choose to forego greater income in order to accept a job, such a college professor, that has a high social status and increases one’s life satisfaction because of their job.)

The two main types of social mobility are intergenerational (i.e., a person is better off than their parents or grandparents) or intragenerational (i.e., income changes within a person or group’s lifetime). Both are important in determining whether social mobility is increasing or decreasing.

What increases social mobility? As a recent article in the New York Times explains, there are four broad factors that appeared to affect income mobility:

1. The size and dispersion of the local middle class,
2. Two-parent households,
3. Better elementary schools and high schools, and
4. Civic engagement, including membership in religious and community groups.

By contrast, as James Pethokoukis notes, there was little or no correlation between mobility and the sort of stuff that left-liberals might prefer to focus on: taxes (tax credits for the poor or higher taxes for the rich), college tuition rates, or the amount of extreme wealth in a region.

While income inequality has a simple solution (e.g., take money from group A and give it to group B), social mobility is more complex and reliant on social and cultural factors. If we truly want to help all Americans, though, there are a few things we could do: encourage parents to stay together, improve our local schools, and get involved in our communities. Doing that would improve the quality of life for millions of Americans in a way that worrying about the size of our neighbor’s paycheck can never do.

Joe Carter Joe Carter is a Senior Editor at the Acton Institute. Joe also serves as an editor at the The Gospel Coalition, a communications specialist for the Ethics and Religious Liberty Commission of the Southern Baptist Convention, and as an adjunct professor of journalism at Patrick Henry College. He is the editor of the NIV Lifehacks Bible and co-author of How to Argue like Jesus: Learning Persuasion from History's Greatest Communicator (Crossway).

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