Opinion | The U.S. Is Lagging Behind Many Rich Countries. These Charts Show Why. – By David Leonhardt and Yaryna Serkez – The New York Times

By David Leonhardt and Yaryna Serkez,  July 2, 2020

“The United States is different. In nearly every other high-income country, people have both become richer over the last three decades and been able to enjoy substantially longer lifespans.

But not in the United States. Even as average incomes have risen, much of the economic gains have gone to the affluent — and life expectancy has risen only three years since 1990. There is no other developed country that has suffered such a stark slowdown in lifespans.

Life expectancy and G.D.P. per capita 1990-2018″

Opinion | How to Avoid an Economic Recovery that Worsens Inequality – By Tim Wu – The New York Times

By Tim Wu

Mr. Wu is the author of “The Curse of Bigness: Antitrust in the New Gilded Age.”

• June 18, 2020, 5:00 a.m. ET
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Credit…Michael George Haddad

“Since January, Amazon’s stock price has gone up from about $1,850 to about $2,600. The S.&P. 500 — comprising large corporate stocks dominated by technology companies — has recovered most of its recently lost value. And most highly paid professionals and managers have kept their jobs and experienced minimal changes in wealth.

Yet more than 20 million Americans are unemployed.

These are signs that the economic legacy of the coronavirus pandemic could be an increase in wealth concentration that will shock a nation that thought itself numb to such things. Arguments over whether the recovery will be “V-shaped” or “U-shaped” ignore the fact that different socioeconomic classes have been affected differently and will recover differently. Despite its populist airs, the Trump administration is orchestrating what will be, unless something is done, a rich man’s recovery.

While it may seem as if the federal government is throwing money at everyone, there’s a key difference between the support given to large businesses and the support given to small businesses and individuals. Large businesses have been given the security of long-term assistance, mainly through the actions and promises of the Federal Reserve: to buy corporate bonds (including junk bonds), to provide “liquidity backstops” by serving as a buyer of last resort and to lend money against an array of collateral. Collectively, these actions amount to a program not just of extraordinary assistance but also of extraordinary assurance.

By contrast, the money being spent on small businesses and individual workers is short-term and hard to bank on. Not only are many of the sums relatively small — a $1,200 check that might (or might not) come again some day — but the uncertainty also diminishes the value of the aid, since it’s hard to make plans if you don’t know what you can count on.

the aid, since it’s hard to make plans if you don’t know what you can count on.”

Opinion | Who Is Driving Inequality? You Are – by David Brooks – The New York Times

“Who is driving inequality in America? You are. I am. We are.

Did you read to your kids before bed when they were young? If you did, you gave them an advantage over kids whose parents were working the evening shift at 7-Eleven. Did you spend extra on tutoring or music lessons? Since 1996, affluent families have spent almost 300 percent more educating their young while everybody else’s spending has been mostly flat.

Did you marry before having kids and raise your kids in a two-parent home? The children of the well educated are now much more likely to grow up in stable families, and those differences in family structure explain 32 percent of the growth of family income inequality since 1979.

If you did these things, you did nothing wrong. You invested in your children’s flourishing as any decent parent would.

But here’s the situation: The information economy rains money on highly trained professionals — doctors, lawyers, corporate managers, engineers and so on.

Daniel Markovits, author of “The Meritocracy Trap,” estimates there are about one million of these workers in America today. They work really hard, are really productive and earn a lot more. In the mid-1960s, profits per partner at elite law firms were less than five times a secretary’s salary. Now, Markovits notes, they are over 40 times.”

Opinion | Amazon’s Surrender Is Inspiring – by David Leonhardt – NYT

“There are two ways to fight the long stagnation in living standards for most Americans. The first is probably the more obvious and the one I spend more time writing about: through government policy.The government can raise the minimum wage. It can increase the Earned Income Tax Credit, which is effectively a wage subsidy. It can cut taxes on the middle class. It can spend more money on education, child care and health care. All of these are good ideas.But they’re not the only way to lift living standards. For much of the past century, another approach has been even more important: As the economy grew, American companies paid workers their fair share of the growth.”

When the Rich Said No to Getting Richer – by David Leonhardt – NYT

“A half-century ago, a top automobile executive named George Romney — yes, Mitt’s father — turned down several big annual bonuses. He did so, he told his company’s board, because he believed that no executive should make more than $225,000 a year (which translates into almost $2 million today).

He worried that “the temptations of success” could distract people from more important matters, as he said to a biographer, T. George Harris. This belief seems to have stemmed from both Romney’s Mormon faith and a culture of financial restraint that was once commonplace in this country.Romney didn’t try to make every dollar he could, or anywhere close to it. The same was true among many of his corporate peers. In the early 1960s, the typical chief executive at a large American company made only 20 times as much as the average worker, rather than the current 271-to-1 ratio. Today, some C.E.O.s make $2 million in a single month.”

Excellent op-ed. Thank you David Leonhardt. Here is a popular comment I endorse.

Ami

Portland Oregon 5 hours ago

When a nation refuses to invest in itself it rots. The American society of engineers gives our overall infrastructure a D rating. The corps of engineers says our infrastructure is close to failing. We’ve been at war for nearly two decades and our national deficit for 2018 is estimated at $440 billion dollars. Income inequality is the at the highest level since the 70’s and our students owe an average of $1.4 in student loans. We’re not the land of opportunity any longer.

At some point we’re going to need to raise taxes to invest in our country. Otherwise our best and brightest are going to start looking abroad for opportunities.

If you look at the happiest countries they have strong social safety policies and have invested in infrastructure and education. Denmark’s top individual tax rate is 60.4%, Sweden’s is 56.4% and Norway’s is 39%. These countries have government sponsored college education, paid parental leave, universal daycare, and universal healthcare. They only tax businesses at 25%.

Cutting taxes, especially for the wealthy considering how nicely they did after the recession is irresponsible. Hopefully our politicians will choose responsiblity and fairness but I doubt it.

• 410 Recommended

America the Unfair? – Nicholas Kristof, The New York Times

“Martin Gilens of Princeton University and Benjamin I. Page of Northwestern University found that in policy-making, views of ordinary citizens essentially don’t matter. They examined 1,779 policy issues and found that attitudes of wealthy people and of business groups mattered a great deal to the final outcome — but that preferences of average citizens were almost irrelevant.“In the United States, our findings indicate, the majority does not rule,” they concluded. “Majorities of the American public actually have little influence over the policies our government adopts.” ”

Source: America the Unfair? – The New York Times