Thesis In “The Underserving Rich,” Paul Krugman argues that inequality is a grow

Question

Thesis

In “The Underserving Rich,” Paul Krugman argues that inequality is a growing social problem in the US, and that it arises because the poor are born in the wrong circumstance and have no access to resources. And the author also believes that the rich and their “hired guns” are trying to hide the extent of the problem by blaming poor people for their situation and hiding the true wealth of the richest Americans.

I want you to write your own "agree/disagree BUT" thesis statement in response points made in the previous statements. I don't want a simple "agree" or "disagree" response -- I want something more nuanced. For example, you may write, "I agree with this part of author's argument but not this other part,"

Then, I want you write two or three sentences in which you IDENTIFY and RESPOND TO (AGREE/DISAGREE WITH) two or three specific claims that the author makes or uses.

Explanation / Answer

The claim is true to an extent. Data suggests that conventionally measured income inequality as a percentage of total income going to the top 1 percent started increasing in the mid-1980s and peaked at the time of tech boom of 1990s. Given the fact that when a higher percentage of population started filling tax forms, the conventional measure scooped some of the 2 percent into 1 percent. This implies that the income inequality must have risen during the entire period.

Also, it has been stated that during the period of 1968-2007, the maximum capital gains tax rate has changed variably. If the rate had remained the same, presumably the rate of realization would have remained same. Because a higher percentage of capital gains probably went unrealized during the 1970s, incomes of top 1 percent were likely understated. This clearly suggests that if the decrease in the capital gains tax rate is ignored, that is, if the rate has remained the same, the income inequality as conventionally measured is likely to be overstated since the income of top 1 percent is understated.

However, there are few exceptions. As more and more women started working in the late 1970s, employment rate registered a modest rise, partially impeded by a fall in the participation rate of men. Still, the increase in the female labor participation rate had the effect of decreasing the income inequality. This turned millions of one-earner households into two-earner households.

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