Income Inequality: Cavuto Calls Krugman a Liar

Judd of Think Progress watched Neil Cavuto so we don’t have to:

Krugman’s article is about how income inequality is getting worse and, as a result, even though some aggregate economic indicators are positive, most people aren’t benefiting. Cavuto told Krugman, “Here’s what I’m saying that you’re doing: You are lying to people.” Cavuto claims that income inequality isn’t “dramatically worse now than 10 years ago, 20 years ago.”

OK, Cavuto is just another Faux New loud mouth idiot but Judd goofed here:

Actually, Krugman is completely right: things are dramatically worse now than 10 or 20 years ago. Here’s a chart from the Economic Policy Institute that tracks the ratio of the wealthiest 1 percent of Americans to median income in the United States

Judd is pointing out a measure of wealth inequality, which is not the same thing as income inequality. So I went back to this post, which was contrasting the rise in consumption inequality to the rise in income inequality:

Iacoviello’s model predicts that consumption inequality grows less than proportionally as income inequality grows, while wealth inequality grows more than proportionally.

The rise in wealth inequality has been greater than the rise in income inequality, but the evidence is clear. Paul Krugman was right and if Faux News were a real news outfit, they would have fired Neil Cavuto a long time ago. Then again – I can’t think of many Faux News folks who would have been kept by a real news organization.