Add another negative to the list for Louisiana.
While Gov. Piyush Jindal trots all over the country telling everyone who will listen about the state’s robust economy, the low unemployment rate and the incredibly favorable business climate, a national study has revealed that Louisiana has the third widest gap between rich and poor, roughly equivalent to some Third World countries.
The report, by 24/7 Wall Street, employs the widely accepted Gini coefficient which measures income inequality to arrive at its results. The Gini coefficient is a number between zero and one with zero representing perfect income equality and a place with a score of one would have only extremely wealthy and extremely poor people, with no middle class.
The state Gini coefficients range from .419 in Utah to .499 in New York, indicating that all 50 states have relatively high income inequality compared to the rest of the world.
The most alarming aspect of the latest results is the trend toward a widening gap, the report indicates. In 1967, the Gini coefficient for the U.S. was .397. Today, it is .469, evidence that America’s income divide has become greater.
The widening gap between rich and poor has been a growing issue between Republicans and Democrats on both the national and state levels.
Many of Jindal’s proposed programs, critics say, would do much toward widening that breach even further. The privatization of state agencies would result in layoffs of state employees and Jindal’s proposed retirement reforms would have sharply reduced state pensions. Cuts to higher education have resulted in further layoffs.
New York, with a Gini coefficient of .499, had the largest disparity between rich and poor despite having the sixth highest (7.4 percent) percentage of households earning $200,000 or more per year. At the same time, New York’s 14.1 percent of population living below the poverty line was 21st highest in the nation.
Louisiana, with a Gini coefficient of .475, was third behind Connecticut’s .486.
Even though the state’s unemployment rate was lower than the national average and the lowest on the list, Louisianans are limited in other areas that limit upward mobility, the report says. Only 82.5 percent of Louisiana residents older than 25 had a high school diploma and only 21.8 percent had a college degree.
And while the unemployment rate is comparatively low, 15.3 percent of the state’s residents received food stamps and the Louisiana median income is 10th lowest in the nation. The 17.7 percent of the state’s population living below the poverty line was fifth lowest in the U.S., the report shows.
Louisiana’s Gini coefficient of .475 is comparable to those of Ecuador (.469), Madagascar (.475), Nepal (.472) and Rwanda (.468), according to a worldwide ranking of Gini coefficients by the CIA.
Any comparison of Louisiana to those countries in misleading, however, because the Gini coefficient takes into account only the disparity between rich and poor and not median or household income.
Other states named as having income large gaps between rich and poor in the report, in order, include:
• Massachusetts (.475);
• Florida (.474);
• Alabama (.472);
• California (.471);
• Texas (.469);
• Georgia (.468);
• Mississippi (.468)