American inequality grows again. Economist Tyler Cowen says it’s going to change us, and describes how.
US inequality is hitting record highs again, we learned last week. Higher than Gatsby levels. The USA pins the needle for inequality globally. Higher than China. Higher than India. Americans have generally been unruffled by that, but then the 20th Century brought our greatest time of equality. In this century, says my guest economist Tyler Cowen, inequality will explode in the US. You’ll be rich or you’ll be Mexico-style poor. He’s OK with that. Nobel Prize-winning economist Joe Stiglitz is not. They’re both with us. Up next On Point: equality and inequality in America.
— Tom Ashbrook
Tyler Cowen, Holbert C. Harris Chair of Economics at George Mason University and chairman and general director of the Mercatus Center at George Mason University, co-author of economics blog Marginal Revolution and author of “Average Is Over: Powering America Beyond the Age of the Great Stagnation” and many other books. (@TylerCowen)
Joseph Stiglitz, Economist and professor at Columbia University, recipient of the Nobel Memorial Prize in Economic Sciences in 2001, former senior vice president and chief economist at the World Bank and author of “The Price of Inequality” and “Making Globalization Work.”
From Tom’s Reading List
NPR: Tired of Inequality? One Economist Says It’ll Only Get Worse — “It’s a radical change from the America of 40 or 50 years ago. Cowen believes the wealthy will become more numerous, and even more powerful. The elderly will hold on to their benefits … the young, not so much. Millions of people who might have expected a middle class existence may have to aspire to something else.”
Washington Post: Gap in employment rates between rich, poor at widest levels in records dating back a decade — “The gap in employment rates between America’s highest- and lowest-income families has stretched to its widest levels since officials began tracking the data a decade ago, according to an analysis of government data conducted for The Associated Press. Rates of unemployment for the lowest-income families — those earning less than $20,000 — have topped 21 percent, nearly matching the rate for all workers during the 1930s Great Depression.”
Wall Street Journal: Wanted: Jobs For the New ‘Lost’ Generation — “From Oakland to Orlando—and across the ocean in Birmingham and Barcelona—young people have come of age amid the most prolonged period of economic distress since the Great Depression. Most, like Mr. Wetherell, have little memory of the financial crisis itself, which struck while they were still in high school. But they are all too familiar with its aftermath: the crippling recession, which made it all but impossible for many young people to get a first foothold in the job market, and the achingly slow recovery that has left the prosperity of their parents’ generation out of reach—perhaps permanently.”