Robert Reich: Widening inequality is killing the economy

The problem isn't that we've been living too well for our means, but that all our gains have been going to the top


Robert Reich
May 30, 2013 10:23PM (UTC)
This originally appeared on Robert Reich's blog.

Even as the economy slowly recovers from the worst downturn since the Great Depression, government-haters and deficit-hawks are sticking to their same story: Americans have lived beyond their means and must now learn to live within them.

The reality is quite different: The means of most Americans haven’t kept up with what the economy could and should provide. The economy is twice as large as it was three decades ago, and yet the typical American is earning about the same, adjusted for inflation. All the gains have been going to the top.

Advertisement:

The notion that we can’t afford to invest in the education of our young, or rebuild our crumbling infrastructure, or continue to provide Social Security and Medicare and Medicaid, or expand health insurance is absurd.

If the median wage had kept up with the overall economy, it would be over $90,000 today — and tax revenues would be more than adequate to cover all our needs. If the wealthy were paying the same marginal tax rate they were paying up to 1981, tax revenues would be far more.

Get it? The problem isn’t that most Americans have been living too well. The problem is we haven’t been living nearly as well as our growing economy should have allowed us to live.

Widening inequality is the culprit. If President Obama is looking for a central theme for his second term, this is it.


Robert Reich

Robert B. Reich is Chancellor's Professor of Public Policy at the University of California at Berkeley and Senior Fellow at the Blum Center for Developing Economies. He served as Secretary of Labor in the Clinton administration, for which Time Magazine named him one of the ten most effective cabinet secretaries of the twentieth century. He has written 15 books, including the best sellers "Aftershock", "The Work of Nations," and"Beyond Outrage," and, his most recent, "The Common Good." He is also a founding editor of the American Prospect magazine, chairman of Common Cause, a member of the American Academy of Arts and Sciences, and co-creator of the award-winning documentary, "Inequality For All." He's also co-creator of the Netflix original documentary "Saving Capitalism."

MORE FROM Robert ReichFOLLOW rbreichLIKE Robert Reich

Related Topics ------------------------------------------

Austerity Barack Obama Robertreich.org Secretary Of Labor Video

BROWSE SALON.COM
COMPLETELY AD FREE,
FOR THE NEXT HOUR

Read Now, Pay Later - no upfront
registration for 1-Hour Access

Click Here
7-Day Access and Monthly
Subscriptions also available
No tracking or personal data collection
beyond name and email address

•••






Fearless journalism
in your inbox every day

Sign up for our free newsletter

• • •