Inequality Is Not Inevitable by Joseph Stiglitz
AN insidious trend has developed over this past third of a century. A country that experienced shared growth after World War II began to tear apart, so much so that when the Great Recession hit in late 2007, one could no longer ignore the fissures that had come to define the American economic landscape. How did this shining city on a hill become the advanced country with the greatest level of inequality?
One stream of the extraordinary discussion set in motion by Thomas Pikettys timely, important book, Capital in the Twenty-First Century, has settled on the idea that violent extremes of wealth and income are inherent to capitalism. In this scheme, we should view the decades after World War II a period of rapidly falling inequality as an aberration.
This is actually a superficial reading of Mr. Pikettys work, which provides an institutional context for understanding the deepening of inequality over time. Unfortunately, that part of his analysis received somewhat less attention than the more fatalistic-seeming aspects.. .
Over the past year and a half, The Great Divide, a series in The New York Times for which I have served as moderator, has also presented a wide range of examples that undermine the notion that there are any truly fundamental laws of capitalism. The dynamics of the imperial capitalism of the 19th century neednt apply in the democracies of the 21st. We dont need to have this much inequality in America.
Our current brand of capitalism is an ersatz capitalism. For proof of this go back to our response to the Great Recession, where we socialized losses, even as we privatized gains. Perfect competition should drive profits to zero, at least theoretically, but we have monopolies and oligopolies making persistently high profits. C.E.O.s enjoy incomes that are on average 295 times that of the typical worker, a much higher ratio than in the past, without any evidence of a proportionate increase in productivity.
If it is not the inexorable laws of economics that have led to Americas great divide, what is it? The straightforward answer: our policies and our politics.
http://opinionator.blogs.nytimes.com/2014/06/27/inequality-is-not-inevitable/?hp&action=click&pgtype=Homepage&module=c-column-top-span-region®ion=c-column-top-span-region&WT.nav=c-column-top-span-region
Uncle Joe
(58,483 posts)Thanks for the thread, elleng.
elleng
(131,276 posts)I think it's important.
Uncle Joe
(58,483 posts)Peace to you, elleng.
fasttense
(17,301 posts)Marx took 18 years and wrote over 2,500 pages analyzing capitalism and he came to the conclusion that numerous, very fatal flaws are inherit in that economic system.
I doubt Mr. Piketty's work is as extensive or as thorough.