The trajectories of income inequality and unemployment affirm the justice of the supply- side argument. The graphs will be analyzed, then an interpretation of the relationship between the graphs will prove the claim as just from a Rawlsian perspective. From the years 1979 to the present the U.S. real average-tax income has increased for all classes of society. Even though the top one percent has a greater slope, the amount of income has increased for everyone. The second graph displays the unemployment rates starting from August 6th, 1979 to the present. On average the slope of the line decreases by a small fraction. Supply-side economics argues that by having lower barriers, i.e. taxes, investors will ultimately increase the demand for employees. How then is this inequality of income justified by Rawls? According to Rawls, "the intuitive idea is that the social order is not to establish and secure the more attractive prospects of those better off unless doing so is to the advantage of those less fortunate" (Rawls, 65). This statement affirms supply-side economics because the purpose of supply-side economics is to create jobs by increasing the prosperity of those better off. .
Observing the two graphs, one can see the top one percent increase average income by about twenty-five percent by the year 1983, but the lowest quintile decrease by about fifteen percent. Now one may assume that this is unjust according to the difference principle presented by Rawls because the inequality created is not advantaged to the worst off. In addition, during this time the rate of unemployment increased by five percent. However, the graph does not stop at the year 1983. After the initial unjust inequality, the lowest quintile average income begins to increase and the unemployment rate drops to five percent by the year 1988, which is less than the initial rate. This interpretation shows that supply-side economics created a short term unjust inequality, but in the long run benefited everyone.
