The Political Origins Of Inequality
It is tempting to blame capitalism for inequality. But it is not just the market that has lead us to a state where the difference between the wealthy and the rest has grown. Joseph Stiglitz explains:
Ideology and interests combined nefariously. Some drew the wrong lesson from the collapse of the Soviet system. The pendulum swung from much too much government there to much too little here. Corporate interests argued for getting rid of regulations, even when those regulations had done so much to protect and improve our environment, our safety, our health and the economy itself. . .
The American political system is overrun by money. Economic inequality translates into political inequality, and political inequality yields increasing economic inequality. . . So corporate welfare increases as we curtail welfare for the poor. Congress maintains subsidies for rich farmers as we cut back on nutritional support for the needy.
Stiglitz concludes:
Click here for reuse options!The problem of inequality is not so much a matter of technical economics. It’s really a problem of practical politics. Ensuring that those at the top pay their fair share of taxes — ending the special privileges of speculators, corporations and the rich — is both pragmatic and fair. We are not embracing a politics of envy if we reverse a politics of greed. Inequality is not just about the top marginal tax rate but also about our children’s access to food and the right to justice for all. If we spent more on education, health and infrastructure, we would strengthen our economy, now and in the future. Just because you’ve heard it before doesn’t mean we shouldn’t try it again.
Copyright 2014 Liberaland
By: Stuart Shapiro
Stuart is a professor and the Director of the Public Policy
program at the Bloustein School of Planning and Public Policy at Rutgers
University. He teaches economics and cost-benefit analysis and studies
regulation in the United States at both the federal and state levels.
Prior to coming to Rutgers, Stuart worked for five years at the Office
of Management and Budget in Washington under Presidents Clinton and
George W. Bush.
12 responses to The Political Origins Of Inequality
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mea_mark July 1st, 2014 at 18:52
Unregulated capitalism is what has led to the current inequality. Without regulation selfish interest slowly takes over the whole system. The first step to correct the imbalance is to increase the top marginal tax rate. Taxes maybe a crude tool in fixing a problem of this magnitude but is none the less effective and needs to be implemented as soon as possible. How the increased revenue gets spent is the finesse part of the solution. Spending must go toward that witch helps as many as possible and not the select few. Bailing out big banks as an example helped a few but has not brought us out of the recession. Revenue needs to be spent on what benefits the many. Health, education, welfare and infrastructure. Once balance fairness and equality are achieved, then regulation of capitalism is needed to maintain.
I think it is fair to blame capitalism for the current inequality but it must be prefaced as unregulated. At the same time I would extend capitalism as the culprit in the environmental disasters we see occurring. An unregulated rush to make as much capital as fast as possible has led to the consuming of resources as fast as possible in a way that has been damaging to the environment. Capitalism must be regulated for the health and welfare of the people as well as the health of the very planet we live on.
SteveD July 1st, 2014 at 18:57
http://www.the-crises.com/wp-content/uploads/2010/12/gini-index-usa.jpg
http://newsjunkiepost.com/wp-content/themes/city-desk/timthumb.php?src=http://newsjunkiepost.com/wp-content/uploads/2010/11/Top-Tax-Rates-1917-20101.png&q=90&w=640&zc=1
mea_mark July 1st, 2014 at 19:50
I like that site http://www.the-crises.com/ was not familiar with it, thanks.
R.J. Carter July 2nd, 2014 at 12:50
That’s an interesting graph, in light of:
Yeah way July 2nd, 2014 at 22:50
“”The first step to correct the imbalance is to increase the top marginal tax rate.””
Agreed…although, in practice, just increasing the top EFFECTIVE rates, that which the folks at the top actually PAY, would be enough. Increasing the top rate itself allows the 0.1% to do a lot of whining and complaining, even though very few of them actually pay anywhere NEAR it! Most of the largest tax deductions benefit the wealthiest folks. Allowing hedge fund managers to be “paid” in future capital gains, for instance, allows them to dodge income tax.
Mitt Romney paid a lower effective rate than I did, or that many folks in my profession did.
it’s time to start treating a dollar earned, as a dollar earned, no matter where it comes from.
mea_mark July 1st, 2014 at 18:52
Unregulated capitalism is what has led to the current inequality. Without regulation selfish interest slowly takes over the whole system. The first step to correct the imbalance is to increase the top marginal tax rate. Taxes may be a crude tool in fixing a problem of this magnitude but is none the less effective and needs to be implemented as soon as possible. How the increased revenue gets spent is the finesse part of the solution. Spending must go toward that which helps as many as possible and not the select few. Bailing out big banks as an example helped a few but has not brought us out of the recession. Revenue needs to be spent on what benefits the many. Health, education, welfare and infrastructure. Once balance fairness and equality are achieved, then regulation of capitalism is needed to maintain.
I think it is fair to blame capitalism for the current inequality but it must be prefaced as unregulated. At the same time I would extend capitalism as the culprit in the environmental disasters we see occurring. An unregulated rush to make as much capital as fast as possible has led to the consuming of resources as fast as possible in a way that has been damaging to the environment. Capitalism must be regulated for the health and welfare of the people as well as the health of the very planet we live on.
SteveD July 1st, 2014 at 18:57
http://www.the-crises.com/wp-content/uploads/2010/12/gini-index-usa.jpg
http://newsjunkiepost.com/wp-content/themes/city-desk/timthumb.php?src=http://newsjunkiepost.com/wp-content/uploads/2010/11/Top-Tax-Rates-1917-20101.png&q=90&w=640&zc=1
mea_mark July 1st, 2014 at 19:50
I like that site http://www.the-crises.com/ was not familiar with it, thanks.
R.J. Carter July 2nd, 2014 at 12:50
That’s an interesting graph, in light of:
Yeah way July 2nd, 2014 at 22:50
“”The first step to correct the imbalance is to increase the top marginal tax rate.””
Agreed…although, in practice, just increasing the top EFFECTIVE rates, that which the folks at the top actually PAY, would be enough. Increasing the top rate itself allows the 0.1% to do a lot of whining and complaining, even though very few of them actually pay anywhere NEAR it! Most of the largest tax deductions benefit the wealthiest folks. Allowing hedge fund managers to be “paid” in future capital gains, for instance, allows them to dodge income tax.
Mitt Romney paid a lower effective rate than I did, or that many folks in my profession did.
it’s time to start treating a dollar earned, as a dollar earned, no matter where it comes from.
fancypants July 3rd, 2014 at 01:24
Much to your surprise or not Walgreens feels it needs a better tax break So its moving it HQ to Switzerland .
Walgreen would accomplish an inversion by completing its purchase, which is expected to happen in early 2015, of Switzerland-based Alliance Boots and moving its corporate home to Europe’s largest pharmacy chain.
http://articles.chicagotribune.com/2014-06-29/business/ct-walgreen-headquarters-taxes-0629-biz-20140629_1_walgreen-co-tax-loophole-alliance-boots
fancypants July 3rd, 2014 at 01:24
Much to your surprise or not Walgreens feels it needs a better tax break So its moving it HQ to Switzerland .
Walgreen would accomplish an inversion by completing its purchase, which is expected to happen in early 2015, of Switzerland-based Alliance Boots and moving its corporate home to Europe’s largest pharmacy chain.
http://articles.chicagotribune.com/2014-06-29/business/ct-walgreen-headquarters-taxes-0629-biz-20140629_1_walgreen-co-tax-loophole-alliance-boots