social policy

“Rough Equality of Means” – Reversing Economic Inequality

Note: this is a cross-post from The Realignment Project. In order to not clog up the front page with lots of re-posts, I'll just mention that I have additional posts out this week that are on a similar topic - one on the abolition of poverty (a similar, but different object from ending inequality), and the other on the establishment of a Fisc - that might interest people here at Economic Populist.


A recent paper by Professor Emmanuel Saez of U.C Berkeley provides further evidence for something that we've sensed already - economic inequality has never been greater in American history. We have finally succeeded in accomplishing that most dubious of accomplishments: we are now officially more unequal, more elitist, and more disproportionally in-egalitarian than the benighted America of 1929.

In 2007, the top 10% of Americans received 50% of the nation's wages. That number, the sheer unreality of the idea that a tiny fraction of the population should have the sheer unmitigated selfishness to claim every other dollar in wages paid out, pales before an even more troubling figure. The top 1% of Americans captured 2/3rds of income growth and 1/2 of economic growth from 2002-2007. At the same time that the rich have gotten even richer, the rest of us have not fared as well - indeed, even before the recession, the average working-age household lost $2000/year of income since the year 2000.

Can this state of affairs continue? And how can we stop it?

"Front Line of Defense" - UI Reform and Job Insurance

Cross-post - original posted on The Realignment Project

"Unemployment compensation, as we conceive it, is a front line of defense, especially valuable for those who are ordinarily steadily employed, but very beneficial also in maintaining purchasing power. While it will not directly benefit those now unemployed until they are reabsorbed in industry, it should be instituted at the earliest possible date to increase the security of all who are employed..."

Do Subsidies Work?

Frequently when prices get too high in some sector governments are called upon to provide subsidies to those who can't afford to pay.

In the US there are a large number of these. Heating fuel subsidies, food stamps, housing rental assistance and Medicaid (not Medicare) are aimed at necessities. There are also government subsidies such as Pell Grants to help pay college tuition. With the sudden downturn in the housing market there are proposals to subsidize existing mortgages. So these actions work?

I'm going to keep this brief and not overload the discussion with lots of statistics, so just take this as a working hypothesis. If you are especially interested in one program or another, or in experiences elsewhere, then please feel free to contribute data.