Wednesday, March 16, 2016

Gateway to Sources and Information About Income Inequality in the United States

Millions of Americans are working longer hours for lower wages, and yet almost all of the new income and wealth being created is going to the top one percent. While the top one percent have seen their incomes rise 18 percent over the past decade, those in the middle have actually seen their incomes fall. 
  Scholars, from the Nobel-Prize-winning Paul Krugman to the widely respected economist James Surowiecki, have been working to analyze these disparities. Americans are not generally aware of the extent of this income inequality. In most developed countries, there is a direct relationship between income inequality and the public's views about the need to address the issue – but not in America, where income inequality is worse but the concern is lower. The most commonly accepted measurement of income inequality, the Gini Index, ranks the United States sixth-worst among 173 nations. 

Private-equity companies are far more obviously connected to an undue concentration of wealth at the expense of workers and communities than are collateralized-debt obligations, which were at the core of our 2008 Great Recession. Within the one percent, there is a top one percent that consists disproportionately of private-equity and hedge-fund principals.


“Recently, as wage stagnation and rising inequality have emerged as
serious problems, the economic arguments for higher education have
come t
o the fore. ‘Earning a post-secondary degree or credential is
no longer just a pathway to opportunity for a talented few,the
White Hou
se Web site states. ‘Rather, it is a prerequisite for the
owing jobs of the new economy.’ Commentators and academic
economists have
claimed that college doesn't merely help
viduals get higher-paying jobs; it raises wages throughout the
conomy and helps ameliorate rising inequality.”

Cassidy, John, “College Calculus, What’s the Real Value of College Education?” New Yorker, September 7, 2015, pp: 80-84. 
Can’t make a dent in the top one percent

“As the economist Lawrence Summers and two colleagues
howed in a recent simulation, even if we magically summoned
up college degrees for a tenth of all the working-age American
men who don't have them - by historical standards, a big boost in
ollege-graduation rates - we'd scarcely change the existing
concentration of income
at the very top of the earnings
distribution, where C.E.O.s and hedge-fund managers live.”

Cassidy, John, “College Calculus, What’s the Real Value of College Education?” New Yorker, September 7, 2015, pp: 80-84.


“Perhaps the strongest argument for caring about higher education
s that it can increase social mobility, regardless of whether the human-capital
ory or the signalling theory is correct. A recent study by researchers at the
Federal Reserve Bank of San Francisco showed that children who are born
o households in the poorest fifth of the income distribution are six times as
likely to reach the top fifth if they graduate from college. Providing access
to college for more kids from deprived backgrounds helps nurture talents that
ight otherwise go to waste, and it's the right thing to do.”

Cassidy, John, “College Calculus, What’s the Real Value of College Education?” New Yorker, September 7, 2015, pp: 80-84. 

“If higher education serves primarily as a sorting mechanism,
that might help explain another disturbing development: the tendency of
many college graduates to take jobs that don’t require college degrees.
Practically everyone seems to know a well-educated young person who
is working in a bar or a mundane clerical job, because he or she
can’t find anything better. Doubtless, the Great Recession and its
aftermath are partly to blame. But something deeper,and more lasting, also
seems to be happening.
[Harvard economists Claudia Goldin and Lawrence F. Katz
theorize] that technological progress generates an ever-increasing need
for highly ed
ucated, highly skilled workers. But, beginning in about 2000,
for reasons
that are still not fully understood, the pace of job creation in
high-paying, high
ly skilled fields slowed significantly. To demonstrate this,
three Canadian eco
nomists Paul Beaudry, David A. Green and Benjamin M. Sand,
divided the U.S.
workforce into a hundred occupations, ranked by their average
wages, and looke
d at how employment has changed in each category. Since 2000,
the economists showed, the demand for highly educated workers declined,
while job growth in
lower-paying occupations increased strongly. ‘High-skilled
workers have moved
down the occupational ladder
and have begun to perform
s traditionally performed by lower-skilled workers,’ they concluded, thus pushing
low-skilled workers even further down the occupational ladder.

“Increasingly, the competition for jobs is taking place in areas of the labor
market wher
e college graduates didn't previously tend to compete. As Beaudry,
and Sand put it, ‘having a B.A. is less about obtaining access to high
paying managerial and technology jobs and more about beating out less
educated workers
for the Barista or clerical job.’"

Cassidy, John, “College Calculus, What’s the Real Value of College Education?” New Yorker, September 7, 2015, pp: 80-84.