What ' s a Night Tsar ? <| sep |> An economist called Kuznets suggested that inequality peaked during economic development at the phase when the economy switched from agriculture to urban manufacturing . A rural poor provided streams of flexible labour , food prices were still low and the middle class boomed as demand for their services grew . Monopolist manufacturers accumulated vast amounts of money until the state intervened , breaking these up and introducing competition . Europe went through this phase in the 18501890 period , the US a little later but today ' s emerging economies are undergoing it right now . This is why the Credit Swisse list is dominated by middletolow income countries . And then there is the US . America spends less of its GNP through the state than any other OECD country . It levels of inequality are high , because the state has a less pronounced redistributive mission than does any of its peers . US exceptionalism is really exceptional . It is , generally , proud to have different social arrangements from Europe or Japan . Unfortunately , US scale means that lessons which progressive dislike about it are then applied to the rest of the industrial countries , where they are far from appropriate .