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Getting Back on Offense: Diagnoses and Prescriptions

Getting Back on Offense: Diagnoses and Prescriptions. What’s Gone Wrong and What Social Workers (and other sane people) Can Do About It Jared Bernstein 5/9/2013. Diagnosis: What Are the Biggest Problems We Face?. Disconnects : Growth, Productivity, Jobs, Wages, Poverty Reduction WHY?

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Getting Back on Offense: Diagnoses and Prescriptions

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  1. Getting Back on Offense: Diagnoses and Prescriptions What’s Gone Wrong and What Social Workers (and other sane people) Can Do About It Jared Bernstein 5/9/2013

  2. Diagnosis: What Are the Biggest Problems We Face? • Disconnects: Growth, Productivity, Jobs, Wages, Poverty Reduction • WHY? • Inequality: What are it’s causes and what does it cause (this latter question essential and underappreciated)? • Relationship between inequality of income and that of opportunity • Inadequate job creation: quantity and quality • Disinvestment: What’s NDD and why does it matter?

  3. Productivity and Real Hourly Compensation of Middle-Wage Workers Source: Larry Mishel, Economic Policy Institute

  4. Causes of Inequality • increased globalization, particularly import penetration from low-wage producers; • diminished unionization, as unions are associated with a more equitable distribution of earnings; • higher unemployment, which like less unionization, reduces the bargaining power of many in the workforce; • ongoing technological change, which increases the relative demand for more highly educated workers—HAS “LABOR-SAVING” TECH ACCELERATED? • the decline in the real value of the minimum wage; • regressive changes in the tax code, particularly tax cuts to high marginal income tax rates and rates on non-labor income; • financial deregulation and “innovation” and the increased “financialization” of industry: the increase of the financial sector as a share of economic activity and the associated growth of income sources, such as capital gains, that are concentrated at the top of the income scale.

  5. Enrichment Expenditures: music and art lessons, books, sports, tutoring. Source: Whither Opportunity? Russell Sage

  6. Dif=0.45 Dif=0.31

  7. Sources: BLS, BEA; employment is for full-time equivalents.

  8. Isn’t There Anything Good Going On? • Of course—macro-economic resilience. • More germane to social workers—safety net has performed far better than most realize. • Recognition (by some) that something’s gotta give • Money in politics; disproportionate influence of wealthy; feedback from wealth concentration to undue influence • Frustration with dysfunctional DC, gridlock, filibuster, Benghazi, repeal of ACA… • Changing demographics (CIR and 27%)

  9. Source: CBO

  10. How Do We Get Out of this Mess? • Go on offense—safety net works and is needed; markets fail! • Yes, raise the minimum, but also the median • Full employment! • It takes a movement…ala immigration reform • Packer: “An idea of the future that’s genuinely shared by large numbers of people…” • Economic rights frame? • OWS…Opportunity/Accountability for All!

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