Bridging the Income Inequality Gap

In this video, Stiglitz summarizes that last chapter.  He points out that median income is about where it was 40 years ago.  He goes on to classify this as a generation of stagnation.  He notes further that from 2009 to 2012, 95 percent of gains in income went to the top 1 percent of those on the economic ladder, and that trickle-down, once touted as the answer to income inequality, just hasn’t worked.

But despair not.  Stiglitz does have some practical suggestions.  First, he states that austerity programs, such as those already enacted in much of Europe, need to be shelved, or, in the case of the U. S., ignored altogether.  Next, Stiglitz suggests what he calls a bank union, that is, a policy, but not structural, consortium of banks, in order to encourage investment in business.  The Nobel laureate concludes by emphasizing the importance of that last suggestion.  He notes that such investment will:

• increase the number of decent-paying jobs available
• thereby increase demand among consumers
• and again thereby, increase consumer spending

Sounds like good old-fashioned common sense to us.  But it’s always nice to have one’s own conclusions validated by someone like Dr. Stiglitz.

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Michele Petrovsky is the Webmaster at Tools4Change, Author of “Cathedral or Bazaar?  Fix Higher Education – Teach by the Seat of Your Pants ,”  “Donkey Dharma,” and “Quick Guide to Linux.” Petrovsky resides in Glen Mills, Pa.

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Photo from Innovation Norway.

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