Archon Fung - Why Has Inequality Grown in America? What Should We Do?

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Occupy Harvard Teach-In 12/7 …

Occupy Harvard Teach-In 12/7
“Why Has Inequality Grown in America? What Should We Do?”
Archon Fung, Ford Foundation Professor of Democracy and Citizenship and Co-Director of Transparency Policy Project, Kennedy School of Government, Harvard University

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  • 1. American Inequality: How Did We Get Here and What Can We Do About it? Archon Fung Harvard Kennedy School #OccupyHarvard Teach-In December 7, 2011Thursday, December 8, 11
  • 2. Thursday, December 8, 11
  • 3. Three Questions • How F**ked Up Is It? • How Did It Get to Be So F**ked Up? • What Can We Do About It?Thursday, December 8, 11
  • 4. How F**ked Up Is It?Thursday, December 8, 11
  • 5. Very.Thursday, December 8, 11
  • 6. AVERAGE HOUSEHOLD INCOME before taxes $ 2M top 1% top 20% second 20% third 20% $ 1.5M fourth 20% bottom 20% $ 1M $ 0.5M BASED ON GRAPHS BY: COURTESY OF: ‘79 ‘83 ‘87 ‘91 ‘95 ‘99 ‘03 ‘07 2007 dollars. Source: Congressional Budget OfficeThursday, December 8, 11
  • 7. Growth in After-Tax Income, 1979-2007 Source: Congressional Budget Office, 2011Thursday, December 8, 11
  • 8. Top 1% Share, 1960-2007Thursday, December 8, 11
  • 9. Distribution of WealthThursday, December 8, 11
  • 10. ■ ■ Distribution of Wealth ■ Source: Michael Norton and Dan ArielyThursday, December 8, 11
  • 11. Who Eats The Pie? 120,000 GDP / Family 105,000 90,000 75,000 ($ 2006) 60,000 45,000 30,000 Median Family Income 15,000 0 1945 1955 1965 1975 1985 1995 2005Thursday, December 8, 11
  • 12. Text Source: Mother Jones MagazineThursday, December 8, 11
  • 13. How Did It Get So F**ked Up?Thursday, December 8, 11
  • 14. EconomicsThursday, December 8, 11
  • 15. EconomicsThursday, December 8, 11
  • 16. EconomicsThursday, December 8, 11
  • 17. Politics!Thursday, December 8, 11
  • 18. Dominant Explanation Skills Biased Technological ChangeThursday, December 8, 11
  • 19. Thursday, December 8, 11
  • 20. But...Thursday, December 8, 11
  • 21. Mechanism for top 1% may be very differentThursday, December 8, 11
  • 22. Who Is Top 1%? Composition of Top 1% 40 30 Executives, managers, supervisors (non-finance) Medical Financial professions, including management Lawyers Computer, math, engineering, technical (nonfinance) 20 10 0 1979 1993 1997 1999 2001 2002 2003 2004 2005 Source: Source: Mike Konzcal via New York TimesThursday, December 8, 11
  • 23. Executive CompensationThursday, December 8, 11
  • 24. SBTC Should Be GlobalThursday, December 8, 11
  • 25. Top 1% in Anglo Countries Figure 4. Plutonomy At Work: The Income Share of the Top 1% Has Risen Dramatically in the U.S., the U.K., and Canada 19 Income Share of the Top 1% 19 17 17 USA 15 15 UK 13 Canada 13 11 11 9 9 7 7 5 5 60 63 66 69 72 75 78 81 84 87 90 93 96 99 02 Please see references 18, 4, 22 in the bibliography at the end of the report for the data underlying the chart. Estimates b Source: CitiGroup Investment Research Source: Citigroup Investment ResearchThursday, December 8, 11
  • 26. Please see references 18, 4, 22 in the bibliography at the end of the report for the data underlying the chart. Estimat Source: Citigroup Investment Research Top 1% Elsewhere Figure 5. Of Egalitarian Bent: The Income Share of the Top 1% Is Much Smaller and at All, in Switzerland, the Netherlands, Japan, and France 19 Income Share of the Top 1% 19 17 Switzerland 17 France 15 Japan 15 Netherlands 13 13 11 11 9 9 7 7 5 5 60 63 66 69 72 75 78 81 84 87 90 93 96 99 02 Source: CitiGroup Investment Research Please see references 7,17,15,4 in the bibliography at the end of the report for the data underlying the chart. Estima Source: Citigroup Investment ResearchThursday, December 8, 11
  • 27. Political Causes • Executive compensation policies • That tie exec incomes to stock markets • Deregulation of financial sector • Tax policy (esp. capital gains and corporate tax)Thursday, December 8, 11
  • 28. What Can We Do?Thursday, December 8, 11
  • 29. Strategy 1 Social Democracy: Effective DemandThursday, December 8, 11
  • 30. Policies • Tax and Transfer • De-commodification • social wages • health care • pensionsThursday, December 8, 11
  • 31. Thursday, December 8, 11
  • 32. Thursday, December 8, 11
  • 33. Strategy 1I Productive Democracy: Effective SupplyThursday, December 8, 11
  • 34. Modes of Production Low Road High Road Price Competition Value Competition Sweated Labor Good training & equipment Poor Labor Relations Productivity Partnerships Economic Insecurity Continuous improvement Minimal state Rich public goods Rising inequality Higher worker incomes Source: Joel Rogers, University of WisconsinThursday, December 8, 11
  • 35. Public Policy “Help pave the high-road, block off the low road”Thursday, December 8, 11
  • 36. Industrial Policy • Real, relevant training • Aligned standards • Deliberative spaces for employers, workers, communities, governments to form productivity partnerships • Even playing field for workplace governanceThursday, December 8, 11
  • 37. Time to get to work.Thursday, December 8, 11
  • 38. Occupy the truth.Thursday, December 8, 11
  • 39. Educate.Thursday, December 8, 11
  • 40. We have real choices.Thursday, December 8, 11
  • 41. Occupy the future.Thursday, December 8, 11