Inequality in income exists due to innovation and hard work. PBS allowed Richard Epstein to explain:

Watch Does U.S. Economic Inequality Have a Good Side? on PBS. See more from PBS NewsHour.

Ed Morrisey who also posted this video at HotAir notes the prevalence of income inequality:

“Income inequality” has always existed. It exists in every economic system ever invented. Does anyone doubt that income inequality exists in communist China, or existed in the Soviet Union? If you don’t want to argue from the extremes, take a look at western Europe, which has relied on massively redistributive policies for decades. The difference between these systems and the American experience is that membership in an economic class has never been static, but is changeable depending on one’s innovation and effort. That goes to the heart of American exceptionalism, and American success — or at least it did before we tried turning ourselves into a version of Europe’s sclerotic nanny states.

In fact, the entire Income Inequality argument rests on a flawed premise, as James Pethokoukis illustrates:

3. Price indexes for the poor rise more slowly than for the rich, causing most empirical measures of inequality to overstate the growth of real income of the rich vs. the poor.

4. Apples-and-oranges kinds of issues—such a differences in household size and inflation indexes—has led highly respected Northwestern University professor Robert Gordon to conclude that the “rise in American inequality has been exaggerated both in magnitude and timing.”

5. The Minneapolis Federal Reserve concluded—after taking into account household size and differing price indexes—median household income for most household types increased by 44 percent to 62 percent from 1976 to 2006. In addition, its research shows that median hourly wages (including fringe benefits) rose by 28 percent from 1975 to 2005.

6. As technological change accelerates and becomes more pervasive, the market will reward workers with more education and skills. As CBO notes: “Numerous researchers have concluded that, on balance, the technological changes of the past several decades—and perhaps the entire past century—increased employers’ demand for workers with higher skills and more education. That increase, along with a smaller increase in  the supply of workers with higher skills and more education, generated substantial gains in the relative wages of  more-educated worker. In the past decades, inequality has been going up everywhere.” It is a global phenomenon.

7. And why did the top 1 percent do particularly well? One potential  explanation from CBO:  ”The compensation of ‘superstars’ (such as actors, athletes, and musicians) may be especially  sensitive to technological changes. Unique characteristics of that labor market mean that technical innovations,  such as cheap mass media, have made it possible for entertainers to reach much wider audiences. That increased exposure, in turn, has led to a manyfold  increase in income for such people.” The CBO also mentioned ”changes in the governance and structure of executive compensation, increases in firms’ size and complexity, and the increasing scale of financial-sector activities” as possibilities.

My bottom line: a) income inequality has increased somewhat in recent decades, but not exploded; b) that increase is natural given technology and globalization; c) incomes could have risen faster with a better educated workforce (that also didn’t have to compete with an influx of workers from Asia), but did O.K.; d) we need to boost education to keep up with advancing technology and productivity; e) the past decade was one of slow growth followed by a nasty recession. No argument there. Looking forward, America will need a pro-growth tax system, smarter regulation and far better human capital (helped by higher teacher pay in exchange for eliminating tenure, more skilled immigration, etc.). That way, incomes won’t just be more equal, they’ll be growing.