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The United States currently has one of the highest levels of inequality among industrialized economies. In addition, numerous scholars have shown that social mobility in the United States is significantly lower than it was in the period between 1945 and 1970, when inequality was declining. The combination of these trends is dangerous because it risks transforming the United States into a society where small elites capture most of the gains, a pattern in which growth cannot be sustained over time. The level of inequality in the United States after taxes and transfers are taken into account is much lower, but it is still higher than in most OECD countries, and the trend is still for inequality to increase. This article explores how the U.S. tax system can be used to counter these trends and concludes that the key is not to increase taxes on the rich (although some reforms in this direction can be adopted) but instead to adequately fund and even strengthen the social safety net. The only way to do this in the medium to longer term is to adopt a broad-based federal consumption tax.


This is an open-access article distributed under the terms of the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License, which permits you to copy and redistribute in any medium or format, for non-commercial use only, provided that the original work is not remixed, transformed, or built upon, and that appropriate credit to the original source is given. For a full description of the license, please visit Originally published as: Avi-Yonah, Reuven S. "The Parallel March of the Ginis: How Does Taxation Relate to Inequality, and What Can Be Done About It?" American Journal of Law and Equality 2 (2022): 238-246. DOI: