Clarify: The real cost of income inequality

Clarify: The real cost of income inequality


I’m baratunde thurston and this is
clarify the show breaking down issues that matter to you most this election.
Mic and Spotify have joined together to bring you some of the facts that can
help inform your November 8 decision Y’all remember the facts right? Those
small irritants that get in the way of a strongly held opinion? Today I’ll be
sitting down with Prophets of Rage a group combining Rage against the Machine
Public Enemy and Cypress Hill we’re going to be talking about income
and wealth inequality which by the way aren’t the same thing Income inequality measures the
difference in people salaries. Wealth inequality is the unequal distribution
of assets including things like homes businesses and investments. Income
inequality has been growing remarkably this concentration of income at the top
hasn’t been seen since the nineteen twenties right before the Great
Depression while that might sound bad wealth inequality is even worse are you sitting down? The top 85
wealthiest people in the world own fifty percent of all the wealth. 85 people
fifty percent. Now those 85 people could fit inside to greyhound buses of course
they are the type of travel by bus but you get the idea it feels like the American Dream is
dying and most of us don’t have enough money to buy something nice to wear to
the funeral. But how did the wage and wealth gaps get this wide Mic reporter
Natasha Noman is here to help clarify There has always been a gap of some kind
between rich and poor we see it in early religious documents In the history of the world –
what’s different now? Well I’m somebody who likes to apply
historical context when we’re looking at something like this because i don’t
think people do that very often and the more I mean you see this sort of a trend
that’s gotten worse since the neoliberal era and when Thatcher and Reagan were in power in the eighties were they kind of liberalized markets and they gave the
wealthy and powerful more influence over fiscal policy it’s just kind of gotten
out of hand and gotten worse and more power that they get the more they’ve
really rig the system so that it’s impossible for anybody – there’s
essentially no more social and economic meritocracy as a result. Was there ever a
social and economic meritocracy? Yes I think so I mean in the Golden Age
of capitalism which is from the end of the war so 1945 the end of the second
world war two 1975 and that’s when capitalism was at its best and that was
also when inequality was lowest i mean that’s that’s something people keep
forgetting is combating income inequality or an inequality of any
kind doesn’t just benefit those who are vulnerable right now who are on the
front of it but it benefits everybody economic growth tends to be higher when
there’s less income and wealth inequality. If you look at the rate at
which CEO compensation has grown between so 1978 and 2013 what do you how
much do you think it’s grown? Like a thousand percent? Right on the money. Nailing it. I kind of want to high-five you. You can high five me. yes I thought you were too far away but
you made it possible I feel better Never too far for a high five. There are
going be more just warning you. So has CEO compensation grown by a thousand
percent because CEOs are a thousand percent better than they were in the 70s?
Absolutely. No because they’ve gotten more of a handle on the system now comparatively my next quiz question how much do you think the average workers income has increased between 1978 and 2013? Less than five percent. Ok little better than that Yes! underestimated the people. What’s the number? Ten percent. So workers wages are growing 10-percent, CEOs…
at a rate 100 times faster than the average worker. And are you sure this is not because CEOs have become a hundred times more productive efficient
and effective as the workers that they employ. Well the growth rate and the
stock market would suggest not because the rate at which the CEO
compensation grew was double that of the rate at which the stock market grew
so no. Very few people i think return to what opened the door, what started this – the combined effect of reduced regulation at the high end of the
economy and finance and increased restrictions at the low end on organizing
labor and fighting for fair wages absolutely when you look at CEO
compensation a thousand percent they’re at the top of the chain they own the
factories they have money to play with and investments and when you look at the
bottom of the scale of the workers ten percent growth they’ve been de-unionized
and it’s been maybe less legal for them to fight for a rise in wages you
know concurrent with their bosses. You’ve put a
perfectly that’s the irony here how can you be giving the most powerful
and the most wealthy in a country more freedom while you’re restricting the
most vulnerable and the poorest. If a country has a moral obligation to take
care of its citizens then that makes no sense What happens to a society that continues
on this path where income and wealth inequality continue to grow larger? I
don’t want to find out I don’t know. This is the the
worst it’s being in a long time since the Great Depression in the twenties. But
worked out great oh yeah no that was yes exactly it’s
called great because it was so much fun exactly it’s called great, it’s not called the ‘sad’ depression – or the worst depression It’s the great depression This is getting really depressing and
and so what I want to ask you is to shine a little hopeful light on this
topic are people more aware and upset by this
then you’ve seen historically since the early nineteen eighties and what can be
done I think income inequality has become
part of the political and social zeitgeist increasingly to me – especially
over the last five years as far as I mean from where I’m standing that’s what
it looks like income inequality is getting more
attention as for what can be done i think it’s going to be a confluence of
policies fiscal and otherwise i would also say campaign finance reform plays
into this because the lobbying of the financial sector is so successful
and obviously it seems to be kind of a limitless pool of money it is very
dangerous because it encourages this relationship between politicians and
finance. Is there anything else you want to add on this topic maybe something
that doesn’t make us want to cry And burn all the monuments down okay here’s the thing all right i’m
going to make this personal not for you for me. I’m
half-pakistani I grew up in a place where I literally saw the only way out
of oppressive or abusive circumstances for women was economic empowerment. With
a GDP of roughly $232 billion and Pakistan being the six largest
population in the world it doesn’t have a tremendous amount of opportunity to
lift people out of poverty and to reduce economic inequality. America’s GDP is
about $17 trillion It has everything it needs to tackle
this. All the ingredients are there all the components are there is just
about arranging them in the right way and so I am optimistic in that I know
it’s feasible in America I know it’s possible and it may take a long time and
it may take a lot of perseverance but i don’t think that it’s an impossibility
and so when i’m looking at a place that sort of so desperate and so
in many ways like very sad living in Pakistan you see children you know starving on
the street you look around and you think well there’s not really a way out of
this but you look around in America and you see an illiterate person earning the
minimum wage a single parent you just think okay maybe the minimum wage
is going to be raised to $15 and that’s going to be a complete game changer and
that’s not out of the realm of possibility

Author: Kennedi Daugherty

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