Tuesday, February 11, 2014

Economics 101: Do unions decrease the income gap?

Obama has said that raising taxes on the rich would decrease income inequality, or reduce the gap between the rich and the poor.  But, as we proved yesterday, this is not true.  So they also say that unions can improve the income gap.  Is this true. Let us look at the facts.

A state by state comparison did nothing to improve the income gap either.  The following states are all forced union states:

  1. New York
  2. California
  3. New Mexico
This means that in these states you take a job with a unionized firm, you must join the union.  All three of these states have the highest inequality of any other state. 

On the contrary, the states with the lowest income gaps are the following: 
  1. Iowa
  2. Utah
  3. Wyoming
So this goes to show that neither high taxes, nor unions, decrease the gap between the rich and the poor.  This goes against everything taught by liberal institutions. 

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