My Home About Me

The New Republic's Jonathan Chait asks leftist economist Peter Orszag a tough question. In essence, it is: how can the Bush tax cuts be blamed for growing pre-tax income inequality? In essence, Orszag's answer is: well, uh, gee... I just feel that it does.

[Chait:] Now, how about this problem we've been seeing, this wedge between rising productivity and median wages where workers are being more and more productive and aren't getting wage gains commensurate with their productivity. That doesn't seem to be connected to tax cuts or any other public policy, does it?

PO: Three things. One, fiscal policy has exacerbated [the distribution problem]; it's diverted attention from some of the things that might likely have raised median income wages gradually over time; and the third thing is I think it's feeding into a social norm or prevailing tendency that everyone's in it by themselves and that feeds the kind of outcomes that we're seeing. There isn't a social norm of raising consciousness about this disconnect and what to do about it.

Thanks to reader Jameson Campaigne for the link.

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