Fair policies can address in-equitable income distribution

Editor, REFERENCE IS made to Jeffrey Frankel’s article, “Improving income distribution requires best policies” (The New Times, April 24).

Sunday, April 27, 2014

Editor,

REFERENCE IS made to Jeffrey Frankel’s article, "Improving income distribution requires best policies” (The New Times, April 24).

To some extent, this is a reassuring analysis because it shows that most people – rich and poor alike – agree that inequality is undesirable.

Not even a tongue-in-cheek saying that some see inequality as a motivational force that drives the less fortunate to fight tooth and nail, and improve their economic status, holds in this case.

But the original idea here is the fact that inequality may be increasing not for lack of balancing measures and policies supposed to fill the gap between poor and rich (interesting point), but because these measures are either poorly conceived and ‘inadvertently’ benefit the rich or, worse, ‘purposely’ conceived to indirectly benefit the same wealthy groups.

Subsidies are a case in point for the author, although it is more about how they are structured – and therefore who they end up benefiting – rather than the redistribution concept behind.

Either way, inequality increases because people "do not understand the economics”, and therefore support policies which are not in their favour. This is an eerie reminder of the opposition to the affordable care act, some of which came from the very groups that would have gained the most from.

So, best policies yes, but driven by a better comprehension first!

Diyana, Rwanda