Kristof on Inequality and What To Do About It
Friday, October 21, 2011
Welcome to Politics Bites, where every afternoon at It's A Free Country, we bring you the unmissable quotes from the morning's political conversations on WNYC. Today on the Brian Lehrer Show, Nicholas Kristof, New York Times columnist and co-author of Half the Sky: Turning Oppression into Opportunity for Women Worldwide, discussed inequality in the U.S.
Occupy Wall Street has cracked open a dialogue about inequality in the U.S., which has spurred some discussion around policy. Nicholas Kristof of the New York Times has started to paint a picture of what some of this policy might look like.
What does inequality look like?
Here are a few facts Kristof has exposed that demonstrate the current state of inequality in the U.S.:
- The top one percent of Americans posses more wealth than the bottom 90 percent.
- The 400 wealthiest American individuals have a greater combined net worth than the bottom 150 million Americans.
- In the Bush expansion of 2003 to 2007, 65 percent of the gains went to the richest one percent of Americans.
Some level of inequality is needed to drive an economy, but no matter how you look at it in the U.S., it's become exponentially worse, Kristof said.
This is not just an issue of fairness, it's also an issue of economic inefficiency. When you reach the kind of levels that we have now then it becomes an impediment to growth.
As for how President Obama is responding to this problem, Kristof said the jobs bill would certainly help, but there's no one single answer.
There's no one silver bullet that is going to solve these kinds of problems. They relate both to the rules for the tree tops for financiers but also the grass roots issues of creating more opportunity for people at the bottom.
How do we fix it?
Kristof said he'd like to see bolder initiatives to regulate finance.
Things like closing the carried interest loop hole, which strikes me as one of the most egregious that we have, where by some of America's richest people pay only a 15 percent tax on what is effectively their earned income, even though it's taxed at a capital gains rate. I'd like to see a financial transaction tax, things like that.
He's also thinking of broader policy.
Above all, I'd love to see early childhood education because it seems to me that that more than any other single step would tend to promote greater equality in the country and create more opportunities for people at the bottom.
About five years ago, studies showed that when you test kids in Head start, for example, kids show gains but then those gains fade out. But Kristof said there have been more recent studies that follow these kids for a longer period of time.
It finds that indeed their test gains don't improve, but their life outcomes gain substantially. They're more likely to graduate from high school. They're more likely to attend college...
These are the kinds of improvements, according to Kristof, that could begin to shift the country's inequality.