Reich went from being Clinton’s Secretary of Labor to a professor at Brandeis (the class was called “Wealth and Poverty”) to, now, a professor at UC-Berkeley. His central issue is income inequality, and his new film (trailer above) is called Inequality for All. It debuted in late September of this year in theaters after being part of Sundance last January. The essential goal of the film is to change the conversation about income inequality in the U.S., ideally in advance of the 2016 Presidential elections. Some of this discussion is all very AP Economics-type stuff, and people tend to have drastically divided opinions on those things, usually relative to how you were raised. Reich’s arguments seem to make general sense, such as this one from the PBS Newshour link above, when asked why the idea of “income inequality” should even be considered a bad thing:
Well it’s a bad thing in two regards, even if you don’t particularly worry about issues of fairness or public morality. It’s bad, number one, because no economy can continue to function when the vast middle class and everybody else don’t have enough purchasing power to buy what the economy is capable of producing without going deeper and deeper into debt. Seventy percent of the entire economy is basically consumer spending. And if consumers don’t have the wherewithal to spend because all the money’s going to the top, and the people at the top only spend a very small fraction of what they earn, then the economy is almost inevitably destined to slow.
That above embed is from CBS Sunday Morning yesterday; it contains an interview with Reich within a piece about “the fight for a living wage.” The essence of the story above is that many fast-food and other service workers want $15/hour to be the base (I think that’s about $30K a year, so not a ton), but especially in the restaurant industry, no one wants to move it because the margins are so thin. The whole argument seems to go that if we jack the salaries, we need to drastically jack up the food prices, and then no one will go, the places will close, and those jobs will be gone anyway. One of the more depressing elements of all this, which Reich discusses in that video, is that in the mid-1970s and before, these types of jobs — fast food, etc. — were normally held by teenagers or by women who didn’t need to work but had the time to. Now they’re often held by heads of households, or main bread-winners; something like 30 percent of people working at the $7.45/hour level in the fast food industry have kids. The main woman profiled in the video has two kids on roughly that much money. That’s literally brutal. Reich argues that the gap between wages and company earnings intensified when unions and manufacturing jobs started being driven out; I think that’s a fairly conventional argument.
Reich has talked extensively about income inequality as the opponent of true economic growth, and we seem to get new information every day that the rich are getting richer, while the poor are getting poorer. 86% of the world’s global wealth is in the hands of 10% of its citizens, for example.
Now, Reich is excellent at explaining the problems we’re facing in short, easy-to-understand formats such as this one:
… and the media tour for the documentary has been impressive (there are 7,000 different references to Reich and the film on Google News right now). But at the end of the day, it’s a documentary. While media does have the power to change the world, and most of us certainly want to believe that unconditionally, people will see news clips about this movie, or go see the movie themselves, or see a post about it and tweet it or share it on Facebook, and … then what? The conversation can be shifted, and hopefully issues of inequality do come up in 2014 and 2016 races (at least state-level races, because Congress probably won’t achieve a ton between ’14 and ’16). One of the issues we face when trying to tie politics back to inequality solutions is that, in the modern political climate, you essentially need to be rich or well-connected to run (“well-connected” and “rich” are often synonyms in America). Very few people can run out of the back of a pickup truck in the modern age and win. So you essentially have millionaires trying to be empathetic about people whose lives they either left behind decades ago or never knew to begin with; the incentive to “pull up the ladder” is high.
Reich is doing something about it, which is awesome and noble — but what is the big answer here? Is there one? At a global level, the issue is more complicated. In America, there’s an argument that it’s as simple as teaching us to live on the cheap. Universally, people seem to believe income inequality is a bad thing for the U.S., especially when you consider this dagger of a paragraph from Forbes:
One report by Pulitzer Prize winning journalist David Cay Johnston conducted for Tax Analysts found incomes of the bottom 90% of Americans grew only $59 (adjusted for inflation) from 1966 to 2011, while incomes for the top 10% rose by $116,071.
Oftentimes, people frame this discussion around “We need more education!” or “We need better jobs!” It’s true; we need both of those things. “More” education hopefully would mean “better” education, which is an achievable goal — just a hard one rooted in a sphere with a lot of fundamental infrastructure issues. “Better jobs” is something the U.S. tries to achieve every day, and reports on monthly. We’ve been trying to do better at both these things for decades; income inequality has just drastically risen in that time.
There are different ideas all over on what we can do (here, here, and here, as starters), but it kind of seems like this is an issue where we need to throw out the niceties and the convention. Part of the appeal of America is that you can get rich here, which is seemingly harder to do in other countries. “The American Dream” is a story and a concept that has permeated every aspect of popular culture for about six decades, if not longer. Getting rich is a goal; another goal, which people try to tie back to religion at dinner parties often, is doing better than the previous generation. Over time, that became tied up with achieving prosperity, not necessarily “being a good role model for your children” or something (argument goes that “being a good role model” doesn’t pay for food and Christmas gifts). So, as a country we want wealth, we feel OK pursuing wealth, and we want to give our children’s generation more than we had (which we invariably define in terms of wealth). We also tend to distrust others. So if we’re born into a position of wealth/power, we fight to keep it; we want others to stay out — to stay where they were/are/etc. This cycle keeps perpetuating, and keeps growing. It’s hard to move up, but it’s also hard to completely fall down unless you do something illegal or perverse. So the rich get richer and the poor get poorer, sometimes at the expense of the rich. That’s how it goes; in most situations (not all), that’s the actual reality.
Since that reality exists, we need to blow up elements of the system. You want to fix education? Fix the focus. Kids don’t need facts. No one remembers trig, even the people who use trig in their jobs. Kids need to read and take information from the reading. They need to learn how to use the Internet and figure out what’s viable and what’s not. They need to know how to balance a bank account. They need critical thinking skills. A good portion of our education system is honestly still rooted in a time when kids worked the fields in the summer; that’s ludicrous. Blow it up. Change what we focus on. Then work on student loans. Someone needs to come along and do for higher education what Steve Jobs did for the cell phone. Make it easier to get a pedigree education. Make it so that you can come out on relatively equal footing with your peers, regardless of first salary. Income inequality is a big enough problem that we’re not going to fix it with standard solutions; we’re a nation of smart people. Most of those solutions have been proposed and attempted. The problem got worse. Isn’t that when you do something completely different?
You can easily make an argument for one of about 1,000 things being “the biggest problem America is currently facing.” Health care right now, for example, is a legitimate wreck. But at the core, a lot of these things are tied back to inequality and what’s happened to America as the jobs that we built around went elsewhere: it’s an uneven playing field, and a legitimate one at that, but we keep bringing more people and new people into it with the idea that things can be better for them. I honestly applaud Robert Reich for what he’s doing to raise awareness — and if his former boss’ wife runs in 2016, hopefully he can get in front of her and encourage this as an issue — but we need more than awareness: we need a full-scale re-evaluation of how we view this topic. Check this out, that I found while researching/Googling: “income inequality problem(s)” gets you 20 million hits. “Income inequality solution(s)” gets you 6 million. That’s an unequal gap right there. There are ideas out there, but it might require the type of bold leadership that … yes … kinda disappears when you have the elites worried about maintaining their wealth and everyone else worried about feeding themselves.