The Great Divergence

Perhaps the most important achievement of Occupy Wall Street has been to call attention to the yawning gap between the rich and the poor in the United States. Before the protests only  a commentators (including DOTE) ever brought the subject up. Now that the more mainstream types have gotten this particular clue, they're writing books about it. One such person is the New Republic's Timothy Noah, who was interviewed recently by The Daily Ticker's Dan Gross and Henry Blodget.

The perpetual discussion about the ongoing battle between rich and poor, between the one percent and the ninety-nine percent, has generated a great deal of heat, but not much light. With The Great Divergence: America's Growing Inequality Crisis and What We Can Do About It, New Republic columnist Timothy Noah brings a well-reasoned array of high-wattage spotlights.

Noah, who joined Henry Blodget and me this morning to discuss his book, traces the history of income inequality and synthesized much of the academic research on the topic into a highly readable extended essay. And the news isn't great. "There are various ways to measure income distribution, and by all of them the United States ranks at or near the bottom in terms of equality."

The data — and our personal experiences — tend to tell a widely accepted story. Between 1950 and 1980, a period economists call "the Great Compression," income inequality tended to decline. The rising tide of American economic growth lifted all boats, and people at the bottom and middle runs of the income ladders enjoyed rising incomes and standards of living.

But starting in about 1980, the period of "The Great Divergence," [all that] began to change.

DOTE veterans will immediately notice that the story states that the Great Divergence between the rich and the poor began around 1980, which is when I date the beginning of our decline based on the economic trends, including our astonishing income and wealth inequality. The Daily Ticker story sums up Noah's view of the causes of the Great Divergence, which includes the usual suspects—the decline of labor, the decline of education, capture of the government by special interests, and so on.

Below I've included The Daily Ticker discussion of wealth & income inequality in the United States. And that's all that will ever happen—there will be an endless discussion. Like every other tragedy in this once great country, this issue has been (and will be) talked to death without any action ever being taken to rectify the situation. The elites are not going to give up the money & power they have accrued over the last 30 years. Don't hold you breath waiting for that to happen. The Empire is in terminal decline.

 

Comments

[Mister Roboto]

Yep. In the immortal words of Darva Conger of "Who Wants To Marry A Millionaire" infamy back in 2000, "America is high school, and the Internet is the bathroom wall." The bathroom wall where we discuss and discuss and discuss how much those darn Cool Kids are just ruining stuff for everybody else, knowing full well it will always be that way until the bitter end.