The Wealth Gap: A Serious Threat to the Country
This isn’t exactly a news flash. Liberals and some economists have been warning us about this for years. But somehow it has more Gravitas coming from this article in the Christian Science Monitor.
President Obama has been stressing this issue a lot lately, but I think he’s going about it the wrong way. He puts too much emphasis on “fairness;” the rich “paying their fair share.” Unfortunately I don’t think the concept of “fair” resonates with the public. Most people are motivated by “what’s in it for ME?” “How does this affect ME?”
And America’s lopsided wealth distribution is most definitely a ME issue. This neo-feudal wealth gap is NOT working. And this is what President Obama and other politicians need to be stressing. Forget “fair.” Communicate with the voters where they live: their wallets.
This also has nothing to do with hating or resenting “the rich.” Ultimately this huge wealth gap will derail everybody, including the one-percenters.
A World Bank economist said:
“The view that income inequality harms growth — or that improved equality can help sustain growth — has become more widely held in recent years.”
That’s putting it mildly.
Nick Hanauer, founder of the venture capital firm Second Avenue Partners — and co-author of “Gardens of Democracy” — said:
“If you have a society where the people at the very tippy top accumulate all of the resources, you choke the economy to death. Steve Jobs didn't launch the iPhone in Bangladesh or the Congo. The iPhone is nothing without millions of people who can afford to buy it.”
Nigel Gault, chief US economist with IHS Global Insight, said that if the share of earnings that goes to pay for labor — rather than corporate profits — had held steady in the last few years, overall economic activity “would be a bit higher than it is now.”
He also said when the playing field is too tilted and un-level, people lose faith in the old adage about hard work paying off. This lopsided playing field is also cutting off access to education for millions of people.
(And unlike John Galt, Nigel Gault actually exists.)
Bruce Judson of the Yale Entrepreneurial Institute said the U.S. is on a path of economic polarization which — based on patterns throughout history — could lead America to dissolution and revolution.
British scholar Richard Wilkinson pointed out the strong correlation — in other advanced countries — between income inequality and higher rates of illness, a general distrust and hostility, and a higher prison population.
The list goes on and on. This problem needs to be dealt with.