January 23

ALL POLITICS IS LOCAL: Income inequality? Not in Maine

By Don Roberts

Let’s begin with a startling fact. Income inequality is essentially nonexistent in Maine.

Our state is lowest, last in the nation, in income inequality. Source: the Gini coefficient — A measure of statistical dispersion intended to represent the income distribution of a nation’s residents.

Texas has the highest rating in this income inequality measure. And therein may lie the story behind this weapon utilized in one of my pet peeves — “class warfare.”

Should it not occur to us that Texas may be a perfect example of why so-called income inequality may be a natural part of success? Texas is at the top in income growth, business expansion and population increase.

Despite polls showing that a majority of Americans do not believe that income inequality has increased, our president is now embarked on a political campaign to further polarize the country for the 2014 elections.

Class envy creates discontent. Dependent voters can be reliable voters; self-sufficient voters can be a threat. As we examine and research this issue, it becomes apparent that major reasons for what is perceived as a problem are: the change from a basic manufacturing society to a job market that now demands highly skilled workers; a widening gap in educational achievement between rich and poor; and the impact caused by those at the bottom of the income distribution ladder seemingly giving up and turning to dependency.

Answers to these causes of income inequality include: investing in a skilled workforce capable of competing in a global economy, closing the gap between income groups in the availability and attainment of educational opportunities, and addressing the fracture of the family unit with its negative effect on expanding generational poverty.

There are no easy answers, but it is certain that efforts must be concentrated in attention to those in early childhood, in campaigns to decrease out-of-wedlock births, and to keep our children in school. A renewed emphasis in vocational education is also called for.

In Maine, where income inequality is lowest in the nation, it is intriguing to take a look at some facts pointing to the reasons why we are least affected by this subject. The answer may simply be that many well-to-do folks in Maine have been driven away by taxation and an unwelcome attitude over the years toward business interests. The result, unlike Texas, has been lack of investments and lower revenue for the state.

Maine has very few high-income taxpayers as a percent of all taxpayers (IRS, 2010). We have only 1.9 percent making more than $200,000 a year and less than 1 percent in the millionaire income category. That makes us 41st in the nation in the the first category measure of income, and 48th in the latter.

Now I ask, would you prefer the income distribution levels in Texas or Maine? Some of these statistics that we are looking at seem to point to who is really better off, despite income inequality in Texas. Let’s face it, there is no income inequality in Maine because we are a poor state. Median income is $34,000.

Most high-income Mainers are business owners — people who have risked the capital, worked the 80-hour weeks and provided the jobs for all the rest of Mainers. And yet, they are the target, time and again, of attempts at increased taxation and punitive regulations. Fewer, poorer, business-owning taxpayers result in less state revenue from income taxes.

It has been 50 years since LBJ declared war on poverty. Has it worked, or does the evidence suggest that there will always be some destined to occupy the lowest rung of the economic ladder?

Poverty is generational — now exacerbated by the decline and fall of the family unit. We must reinforce our search for effective leaders in geographic areas that have the most disadvantaged among us.

Providing hope is essential, along with compassion and assistance, especially to those, who through disabilities, cannot help themselves.

Income inequality may be an inevitable part of the quest for success. But many of those least advantaged among us have proved again and again that success is attainable through self-reliance, hard work and willingness to reach out to those in position to help.

Friday at the Kennebec Valley Chamber of Commerce banquet, hundreds will salute several who overcame major obstacles to “make it.”

A word to our politicians: Do not seek to divide us with the use of “class warfare,” especially here in Maine, where our lack of income inequality renders the issue moot.

Don Roberts is a former city councilor and vice chairman of the Charter Commission in Augusta. He is a trustee of the Greater Augusta Utility District, and a representative to the Legislative Policy Committee of Maine Municipal Association.

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