Paul Krugman on the Income Gap

Question: Is the income gap growing?

Paul Krugman: The income gap is huge.  It’s growing.  Over the last 35 years, it’s . . . there’s     . . .  There’s some real argument about whether the income of the typical family has gone up.  There are . . .  The median income is up a little bit, but that’s because of an increased number of working wives.  And if you take into account the time . . .  It’s not a question you need to resolve.  The point is that we can even argue about it.  In 35 years, we’re talking about over the period when personal computers, and the Internet, and even for that matter fax machines, and freight containerization and bar code scanners – all these things have come along to make us more productive, and yet we’re not sure if workers have gained.  That’s telling . . .  The reason, of course, is huge gains at the top – a few people achieving huge wage gains.  Or non-wage gains, but few . . . you know a small minority explosion of income.  And that’s a . . . that’s a problem.  And in the . . .  In the United States economy the last four years, we’ve had . . . finally we started to get reasonable job growth.  And by the top line measures – by GDP – it’s a growing economy.  But it hasn’t done much for the typical worker.  And it’s . . . it’s really been the left behind economy.  Great . . . great growth in corporate profits, surge in compensation at the very highest levels, but very little for workers.

I mean there’s always a kind of, you know, shuffling, although not as much as people think.  So that’s, you know . . .  I’d like to say Horatio Alger has moved to Europe.  It’s actually harder to make your way from a relatively poor background into the upper middle or above classes in the United States than it is in most European countries.  And the reason is inadequate public education; lack of public funding for college tuition; just the . . . and just the fact that our income gaps are so large that it’s a much steeper climb for people to make.

Given time a lot of people are both rising and sinking.  And it’s . . .  Put it this way.  If you’re a middle class household, your chance of having a series of unfortunate events plunge you into the . . . into the poor or the near poor is a lot higher than your chance of being lucky enough to make it into the small, favored elite.

 

The income gap is huge and a growing problem.

Related Articles

How schizophrenia is linked to common personality type

Both schizophrenics and people with a common personality type share similar brain patterns.

(shutterstock)
Mind & Brain
  • A new study shows that people with a common personality type share brain activity with patients diagnosed with schizophrenia.
  • The study gives insight into how the brain activity associated with mental illnesses relates to brain activity in healthy individuals.
  • This finding not only improves our understanding of how the brain works but may one day be applied to treatments.
Keep reading Show less

Human skeletal stem cells isolated in breakthrough discovery

It's a development that could one day lead to much better treatments for osteoporosis, joint damage, and bone fractures.

Image: Nissim Benvenisty
Surprising Science
  • Scientists have isolated skeletal stem cells in adult and fetal bones for the first time.
  • These cells could one day help treat damaged bone and cartilage.
  • The team was able to grow skeletal stem cells from cells found within liposuctioned fat.
Keep reading Show less

How exercise helps your gut bacteria

Gut bacteria play an important role in how you feel and think and how well your body fights off disease. New research shows that exercise can give your gut bacteria a boost.

National Institutes of Health
Surprising Science
  • Two studies from the University of Illinois show that gut bacteria can be changed by exercise alone.
  • Our understanding of how gut bacteria impacts our overall health is an emerging field, and this research sheds light on the many different ways exercise affects your body.
  • Exercising to improve your gut bacteria will prevent diseases and encourage brain health.
Keep reading Show less