Wealth inequality in America: seeing reality
Check out the differences between (i) what 9 out of 10 Americans think is the ideal degree of wealth inequality; (ii) what they think wealth inequality really is; and (iii) what it really is.
Source: New Economics Institute.
The tilted playing field
For many Americans, Nobel laureate Joe Stiglitz writes, the dream of upward mobility is being subverted by the reality of unequal opportunity:
Probably the most important reason for lack of equality of opportunity is education: both its quantity and quality. After World War II, Europe made a major effort to democratize its education systems. We did, too, with the G.I. Bill, which extended higher education to Americans across the economic spectrum. But then we changed, in several ways. While racial segregation decreased, economic segregation increased. After 1980, the poor grew poorer, the middle stagnated, and the top did better and better. Disparities widened between those living in poor localities and those living in rich suburbs — or rich enough to send their kids to private schools. A result was a widening gap in educational performance…
In some cases it seems as if policy has actually been designed to reduce opportunity: government support for many state schools has been steadily gutted over the last few decades — and especially in the last few years. Meanwhile, students are crushed by giant student loan debts that are almost impossible to discharge, even in bankruptcy. This is happening at the same time that a college education is more important than ever for getting a good job.
A level playing field is a key element of Econ4’s vision of how an economy that works for people, the planet and the future.
Family values?
Stephanie Coontz writes in the Times on family-unfriendly work-life policies:
We must stop seeing work-family policy as a women’s issue and start seeing it as a human rights issue.
Read more here.
Capitalism Unmasked
Capitalism Unmasked, a new eBook edited by Lynn Parramore, was produced in a partnership between AlterNet and Econ4 to expose the myths of unbridled capitalism and show the way to a better future. You can download the PDF here.
The student debt trap and inequality in America
Nobel laureate Joe Stiglitz writes:
In 2010, student debt, now $1 trillion, exceeded credit-card debt for the first time.
Student debt can almost never be wiped out, even in bankruptcy. A parent who co-signs a loan can’t necessarily have the debt discharged even if his child dies. The debt can’t be discharged even if the school — operated for profit and owned by exploitative financiers — provided an inadequate education, enticed the student with misleading promises, and failed to get her a decent job.
Instead of pouring money into the banks, we could have tried rebuilding the economy from the bottom up…. We could have recognized that when young people are jobless, their skills atrophy. We could have made sure that every young person was either in school, in a training program or on a job. Instead, we let youth unemployment rise to twice the national average. The children of the rich can stay in college or attend graduate school, without accumulating enormous debt, or take unpaid internships to beef up their résumés. Not so for those in the middle and bottom. We are sowing the seeds of ever more inequality in the coming years.
Read his dissection of how economic and political inequality are poisoning opportunity in America here.
Health care: where profits warp incentives
Echoing our recent Econ4 statement, Eduardo Porter explains in the New York Times why our healthcare-for-profit system means that Americans pay too much and get too little:
From the high administrative costs incurred by health insurers to screen out sick patients to the array of expensive treatments prescribed by doctors who earn more money for every treatment they provide, our private health care industry provides perhaps the clearest illustration of how the profit motive can send incentives astray.
By many objective measures, the mostly private American system delivers worse value for money than every other in the developed world. We spend nearly 18 percent of the nation’s economic output on health care and still manage to leave tens of millions of Americans without adequate access to care.
Read his piece here.
New narrative for a new economy
John Cavanagh and Robin Broad write on the new economy movement:
If the Occupy movement popularized the call to end extreme inequality, Hurricane Sandy is popularizing the call to rebuild our nation’s infrastructure in a green and resilient manner. Weaving these themes together can make for a gripping narrative.
Read more here.
Economics denial
The New York Times reports today on attempts to suppress a Congressional Research Service report showing that tax cuts for the rich don’t create jobs:
“The reduction in the top tax rates appears to be uncorrelated with saving, investment and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie,” the report said. “However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution.”
Read the Times piece here.
Read the suppressed report here.
How not to create jobs
Lessons from Recent History 101: the Bush tax cuts.
It is Orwellian that after a decade of trillion dollar tax cuts and bailouts of the rich, and a steadily worsening jobs and employment picture for American workers, we are told to be kind to the rich and give them even more money because they are the “jobs creators”.
Read more here.
