Inequality Is Holding Back the Recovery
By JOSEPH E. STIGLITZ
The re-election of President Obama was like a Rorschach test, subject to many interpretations. In this election, each side debated issues that deeply worry me: the long malaise into which the economy seems to be settling, and the growing divide between the 1 percent and the rest - an inequality not only of outcomes but also of opportunity. To me, these problems are two sides of the same coin: with inequality at its highest level since before the Depression, a robust recovery will be difficult in the short term, and the American dream - a good life in exchange for hard work - is slowly dying.
Politicians typically talk about rising inequality and the sluggish recovery as separate phenomena, when they are in fact intertwined. Inequality stifles, restrains and holds back our growth. When even the free-market-oriented magazine The Economist argues - as it did in a special feature in October - that the magnitude and nature of the country's inequality represent a serious threat to America, we should know that something has gone horribly wrong. And yet, after four decades of widening inequality and the greatest economic downturn since the Depression, we haven't done anything about it.
There are four major reasons inequality is squelching our recovery.
To read the entire essay click here.
Joseph E. Stiglitz, a Nobel laureate in economics, a professor at Columbia and a former chairman of the Council of Economic Advisers and chief economist for the World Bank, is the author of "The Price of Inequality."
To read the entire essay click here.
Joseph E. Stiglitz, a Nobel laureate in economics, a professor at Columbia and a former chairman of the Council of Economic Advisers and chief economist for the World Bank, is the author of "The Price of Inequality."
"...putting us behind countries like Bulgaria, Lativa and Greece."
ReplyDeleteIf we are behind Greece, we are in heap big trouble, considering the unemployment rate is 27% there. I do not believe we are behind Greece, that country is on the verge of complete collapse.
Yesterday Obama was talking about the dire consequencies if the sequester goes through, the equivalent of the world coming to an end. He said people would be out of jobs, the military would be compromised, hundreds of thousands would lose primary care, FBI agents would be furloughed, air traffic controllers would be cut back, etc. etc.
ReplyDeleteThis is all a bunch of lies.
The federal budget is 3.5 trillion dollars a year. If sequester goes through, there will be no cuts at all, only a slightly less increase in the rate of growth, 85 billion to be exact. The federal budget is 3.5 trillion a year which is 3,500 billion. So out of 3500 billion there will be 85 billion less which is less than 1/4 of one percent. This is hardly enough to make a difference. Put another way, if one earned $100,000 a year and gave me $200 for Christmas, not enough to make a difference in the lifestyle of one who earned that salary.
Sequestration was Obama's idea in the first place, but the bottom line is that he was lying.
One of the comments in the NYT was interesting. It was something to the effect that one way to judge a country was to see how many people wanted to leave and how many people wanted to come. I don't see how we are in any way behind Greece, although that day might come. I have always been impressed with they way people comment on the NYT. My local newspaper is the Memphis Commercial Appeal and the comments are often crazy on both sides, whereas the NYT crowd seems to be able to have a reasonable discussion. Larry, everytime I read an article like this one I always wonder "What about the debt?" I don't see how we can owe 16 trillion dollars and it not at some point cripple our economy.
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