The Price of Inequality by Joseph E. Stiglitz
The top 1 percent of Americans control 40 percent of the nation’s wealth. And, as Joseph E. Stiglitz explains, while those at the top enjoy the best health care, education, and benefits of wealth, they fail to realize that “their fate is bound up with how the other 99 percent live.”Stiglitz draws on his deep understanding of economics to show that growing inequality is not inevitable: moneyed interests compound their wealth by stifling true, dynamic capitalism.
They have made America the most unequal advanced industrial country while crippling growth, trampling on the rule of law, and undermining democracy. The result: a divided society that cannot tackle its most pressing problems. With characteristic insight, Stiglitz examines our current state, then teases out its implications for democracy, for monetary and budgetary policy, and for globalization. He closes with a plan for a more just and prosperous future.
About the author:
The Price of Inequality is an eloquent analysis of inequality in the United States and what it means for our political system, economy and society. The book does a good job of laying out the facts.One sentence basically says it all: “The top 1 percent of Americans gained 93 percent of the additional income created in the country in 2010, as compared with 2009.” Now think of that in terms of a party with 100 people and big pizza with 100 slices. Basically it means that one rich guy gobbles up 93 slices of pizza. The other 99 get to divvy up the other seven.
Stiglitz does an especially good job of refuting the received wisdom among conservatives: that incomes are in proportion to productive contribution to society. Instead, the book shows that much of our extraordinary income concentration is due to “rent seeking” by the wealthy elite, and that very often this involves taking advantage of taxpayers. We have a system that actively redistributes income and wealth from huge numbers of people at the bottom of the pyramid to a tiny number at the very top.
As the book shows, extreme income inequality is really a kind of cancer that infects almost every aspect of our social, political, economic and even legal system. A tiny elite is able to effectively purchase laws and regulations that work in its favor. For example, bankruptcy laws are designed to favor banks over homeowners and holders of student debt, even though the banks have access to much better information and expertise when making these loans. One idea that occurs throughout the book is that we should have “one person one vote” not “one dollar one vote” and yet the evidence is clear we are moving toward even more influence for those with money.
The Price of Inequality raises issues that should deeply concern every American. One fact the book does not really emphasize is that advancing technology is making many industries less labor intensive, and this could well make things even worse in the future as middle class jobs get harder and harder to find. (For more on how technology may worsen inequality in the future, see also The Lights in the Tunnel: Automation, Accelerating Technology and the Economy of the Future.)That will make it even more critical to somehow solve the inequality problem.
I was truly looking forward to reading this book because the author is clearly a very competent and well recognized professional. I knew going in that his “left leaning” beliefs would color the text-and was really ok with that approach-but was very disappointed to see how overwhelming the slant of the book was such that it really is not an “economic evaluation with social ramifications and political suggestions”; instead it is a “political bully pulpit, supported by some economic data and a lot of broadly drawn social conclusions”.
I think this was a missed opportunity to contribute positively to the dialogue-much like i have seen Mr. Stiglitz do on various television interview programs. I do not disagree with the vast majority of his conclusions but feel strongly that this book will only be read and appreciated by those who are already in agreement and don’t need the reinforcement. Might as well just watch your brand of Fox News or MSNBC to get re-juiced with what you already believe! Too bad-maybe he can find some balance in the next book.
