Wednesday, June 02, 2004
Ominous signs on the economic inequality front
From the 1980s through about 1998, the gaps between rich and middle and poor in the US grew a great deal. The Economic Policy Institute notes that corporate profits have risen 62% during the current recovery, compared to only 2.8 growth in labor compensation. Factoring out growing health and pension costs, wages have actually fallen. (So if you're wondering why it doesn't feel like the recession is over, you know why.) This is a frightening development, and as Brad DeLong notes, it looks like firms are using the slack labor market to keep wages down, and take home all the growth in the pie for themselves. In other words, the class war is really on.
For backgrounders on economic inequality, see this page on inequality trends into the late 1990s, and this Krugman review of what's happened recently (short version: the top 1% is out of sight)
An aside: Juan Cole has some interesting speculation on Chalabi and the Iranians. Not sure I am ready to dismiss an Iranian connection out of hand. The Iraq invasion has exhausted the US---which was already on their doorstep in Afghanistan---and probably strengthens the domestic political position of the hardliners, so it still seems conceivable to me that some factions in Iran would have been interested in manipulating the US into war. But Cole's objections are worth some thought.
For backgrounders on economic inequality, see this page on inequality trends into the late 1990s, and this Krugman review of what's happened recently (short version: the top 1% is out of sight)
An aside: Juan Cole has some interesting speculation on Chalabi and the Iranians. Not sure I am ready to dismiss an Iranian connection out of hand. The Iraq invasion has exhausted the US---which was already on their doorstep in Afghanistan---and probably strengthens the domestic political position of the hardliners, so it still seems conceivable to me that some factions in Iran would have been interested in manipulating the US into war. But Cole's objections are worth some thought.
