I’d like to make this a morality play in which the crisis was caused by injustice, but it’s not that simple. It’s hard to see how inequality led in any direct way to the slump. You have to tell a more indirect story. One issue is that the extraordinary rewards to the upper 0.01% played a role in causing excessive speculation and risk-taking, leading to the crash. Another is that both rising inequality and the Great Recession were due, in large part, to Reaganism – to the belief that the unrestrained market is always right. We don’t have any certain answers about what can raise working-class incomes, but several things should be tried. First of all, Health Reform – at the very least we can ensure that every American can afford needed care. Second, strengthen workers’ bargaining power: make it easier for workers to organize and harder for employers to bust unions. An America where Wal-Mart was unionized would look quite different. Third, better unemployment compensation, so that workers face less financial risk. PAUL KRUGMAN--Nobel prize winner---The number 1 economist in the world.
Posted on: Mon, 29 Jul 2013 23:39:51 +0000
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