Modern American political discourse frequently includes calls to do something about income inequality and poverty. Underlying those calls is the assumption that income inequality in the United States is greater than that in other Western democracies and is growing, and that poverty persists at high levels. In a new paper, John F. Early argues that the statistics invoked to support those claims are misleading, and shows that poverty in the U.S. has declined sharply while income inequality has risen only modestly, in line with trends in other nations.
The Trump administration and Republicans in Congress are considering major tax reforms aimed at reducing tax rates and ending unjustified tax breaks. According to a new bulletin from Cato scholars Chris Edwards and Vanessa Brown Calder, they should consider repealing the Low Income Housing Tax Credit. “It complicates the tax code,” say Edwards and Calder, “and is a poorly targeted solution to housing affordability problems.”