The Fifty Shades of Economic Inequality
Tyler BrownTHE SANTA CLARAJanuary 22, 2014
[dropcap]O[/dropcap]ne afternoon at the Malley Center, I was going through the motions of my usual workout when, out of the corner of my eye, I saw a fellow student step up to a barbell stacked with what looked like far too much weight. To my chagrin, he began to repeatedly deadlift the barbell with form that screamed, “Sure, I’d love to horribly injure my back!”
I was reminded of this free-weight fiasco a week later when I attended a discussion led by economics professors Alexander Field and William Sundstrom.
The discussion was centered on “Capital in the Twenty-First Century,” a 2013 book by French economist Thomas Piketty. Carried by Piketty’s painstaking research and innovative thought, “Capital” has quickly become one of the most heavily discussed economic works in decades.
Now, for an econ nerd such as myself, the thought of such a book being released is enough to jumpstart my salivary glands. But I recognize that other people’s interests might lie elsewhere. For those people, reading a 600-page tome on economics is probably about as fascinating as binge-watching C-SPAN.
There is a reason, though, that the book has been called the “Fifty Shades of Grey” of economics books in terms of its impressive bestselling numbers. But it didn’t sell so many copies because of its flowery sexcapades.
“Capital” paints a vivid, empirical and all-too-scary picture of what I believe is the most challenging issue facing Americans today: economic inequality.
It may still be too early to tell, but upon looking back at the Occupy Movement, it’s a stretch to label it a success; the rich are still getting richer, the poor are still getting poorer and injustices against gender and race are still as prevalent as ever.
If there is one area that the Occupy Movement did succeed in, it was spreading awareness and generating debate about just how unequally wealth is distributed in America. It even condensed the perpetrators of inequality into a handy buzz-phrase, the aptly coined “one percent.”
If it’s true that economic inequality in our country is worsening, why is nothing being done about it? A brief look at U.S. lawmakers is the only thing required to answer this question. Last year marked the first time in history when millionaires made up a majority of Congress. So if the people in charge of fixing a problem are the ones benefitting from it, they have no incentive to take action. This rule rings especially true when their fellow top decile members are the ones keeping them in office.
If you look at the current state of the U.S. economy, there might not appear to be such a pressing difficulty. The unemployment rate is falling, exports are rising and our GDP is rising faster than most of the world’s other largest economies. If these things can occur simultaneously with the growth of economic inequality, what’s the problem?
Unfortunately for the lower 90 percent, the reasons inequality is damaging directly correlate with the reasons it’s not going away anytime soon.
Placing the vast majority of income and wealth into the hands of a small group of people is a disastrous move that could result in the undermining of democracy, as politicians are much more likely to respond to the desires of those who are funding their campaigns than nameless voters.
A second institution that economic inequality damages is the financial system itself. Our politicians say that America is a land of equal opportunity for all, but in a world with rising costs of living, steep tuition costs and unchanging real wages, how much longer will they be able to keep a straight face?
The truth is that America is, and will in all likelihood remain, a rich country. The sad part is that it isn’t one in which every citizen gets to see the benefits of that wealth. Just like that perplexed sap deadlifting at the gym: lots of weight, poor form. And unless someone tells him otherwise, it’s only a matter of when, not if, he breaks his back.
Tyler Brown is a junior economics major.