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But they aren’t, and it is. And in a democracy, it’s not particularly helpful to point out that life isn’t fair. A functioning democracy requires a minimal level of social cohesion, and widening income inequalities put that cohesion at risk. It’s hard to obtain support for policies that serve the public good if people don’t think the public good is in their interest. The HST referendum in British Columbia offers a prosaic, if telling, example. UBC’s Kevin Milligan — who helped the campaign supporting the HST — has noted that public opinion polling showed that B.C. voters generally accepted the point that the HST would have been beneficial for the B.C. economy. The problem was that too many voters didn’t think they would see any of those benefits.

These are common themes, but actually addressing them requires unpacking these generalities. There are at least three conceptually distinct aspects to income inequality, as well as two related issues. Since no one has yet come up with a silver policy bullet that can solve them all simultaneously, it’s worth taking the time to make these distinctions.

Poverty and the incidence of people with low incomes is an obvious place to start, if only because it has historically been the focus of attention in discussions of income inequality. At its most basic level, the policy is to provide a minimal standard of living. In a country as rich as Canada, no one should be deprived of the basics of life, regardless of the circumstances. It’s easy to obtain agreement on this point, but not so easy to obtain agreement on how to define the “basics of life.” Measures of absolute poverty are based on estimates for the minimum income necessary for a basic level of subsistence. But if social cohesion is put at risk by the establishment of an underclass whose incomes stay fixed even as purchasing power increases in the rest of the population, then perhaps a measure of relative poverty — that is relative to the incomes in the rest of the population — is appropriate.