Income inequality

Echidne gives a nice introductory lesson to income inequality. From her conclusion:

What has caused this increased income inequality? Have some people become smarter and harder working while others have just decided to rely on the teats of the welfare state sow? That would be the wingnut interpretation, I guess. A more realistic one would look at the changes over time in outsourcing and international competition in general, the failure of education to respond to the changed needs in the labor force after those changes, and the way taxes have been 'simplified' to fall less on the very wealthy and more on the middle class. And we don't yet know the impact of the repeal of estate taxes on income inequality.