When the bottom half of the country owns basically none of the country’s wealth, they can’t self-insure themselves against these risks. Instead, they must lead a relatively perilous life in which one misstep or mistake could wreck them and their families.
Income inequality is at the root of most of America’s major socioeconomic problems, truly the radioactive element that causes the body politic to decay.
Well, let’s face it: Those who support austerity and inequality are not really about ‘trickle-down’ economics or ‘efficiency and equity.’ They are protecting the interests of the upper class.
As Jonathan Swift warned, ‘It is useless to attempt to reason a man out of a thing he was never reasoned into.’
A bit of moderate inflation is no big deal — the Fed has the tools to easily rein inflation back in if it rises above the central bank’s target rate. In fact, a little inflation could even help matters, by eroding household debt burdens and reducing real interest rates.
On the other hand, mass unemployment is an ongoing economic and humanitarian catastrophe.
It’s like if your house is on fire, and you’re worried that spraying it with a firehose might break some windows. Maybe true! Also a terrible set of priorities!
If Congress were to pass a plan backed by President Obama to raise the minimum wage from $7.25 an hour to $10.10 an hour — a hefty 39 percent hike — it would result in a significant reduction of the poverty rate among Americans between the ages of 18 and 64, and raise about 4.6 million people out of poverty.
Basically, America is separating into aristocrats and peasants.
On one hand you have an upper-middle class and upper class who go to good colleges and have skilled jobs. These people tend to have healthy family values — they get married and stay married, they pay a lot of attention to their kids. They are civically engaged and physically healthy. On the other hand you have uneducated masses, who tend not to stay married, to leave child-raising to single mothers, and to neglect the kids. They are overweight, bedraggled, and disengaged from the community.
At the loftiest heights of the income pyramid, American meritocracy is broken, replaced by the shameful self-dealing of the superrich.
All of us recognize the way the breakdown in meritocracy is playing itself out closer to the middle class. In theory, capitalism provides equal opportunities to every individual, allowing him or her to use innate talent and ambition, combined with more than a dash of luck, to achieve economic success. Also in theory, economic failure is supposed to be justly earned, a product of a deficiency of talent, ambition, and luck.
The reality, of course, is very different — and becoming more so with every passing year. We start out our lives profoundly unequal. Some Americans grow up impoverished, attending chaotic, academically worthless schools, and exposed to an enormous range of social and cultural obstacles to achievement both at home and in the local environment. Others, by contrast, receive a world-class education at school, continual emotional and scholastic support at home, access to tutors, test-prep, and even pharmaceuticals to compensate for a range of cognitive and behavioral deficits.
The proportion of gift-giving money that’s wasted on presents the recipient doesn’t want.
The potential increase in world economic activity from the free flow of workers across borders.