‘Yes, they have very legitimate gripes’

‘Yes, they have very legitimate gripes’ October 13, 2011

Henry Blodget says “Here’s What The Wall Street Protesters Are So Angry About …

The problem in a nutshell is this: Inequality in this country has hit a level that has been seen only once in the nation’s history, and unemployment has reached a level that has been seen only once since the Great Depression. And, at the same time, corporate profits are at a record high.

And he has charts. Lots of charts (courtesy of FRED — Federal Reserve Economic Data).

Let’s start with the obvious: Unemployment. Three years after the financial crisis, the unemployment rate is still at the highest level since the Great Depression (except for a brief blip in the early 1980s).

And then there’s this one:

While CEOs and shareholders have been cashing in, wages as a percent of the economy have dropped to an all-time low.

Go read the whole thing.

Related, Mark Thoma on “Why America Should Spread the Wealth“:

If those at the top of the income distribution receive far more than the value of what they create, and those at lower income levels receive less, then one way to correct this, at least in part, is to increase taxes at the upper end of the income distribution and use the proceeds to protect important social programs that benefit working-class households, programs that are currently threatened by budget deficits. This would help to rectify the mal-distribution of income that is preventing workers from realizing their share of the gains from economic growth. …

The claim that there is a tradeoff between equity and efficiency was a key part of the argument for tax cuts for the wealthy, but the tradeoff didn’t materialize. We sacrificed equity for the false promise of efficiency and growth, and society is now more unequal than at any time since the early part of the last century. It’s time to reverse that mistake.

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