Posts Tagged ‘inequality’

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For those of us of a certain age, especially those of us raised in Catholic households, Father Daniel Berrigan—through his activism and poetry, against war and militarism, racism, poverty and inequality—was one of the true consciences of a church and a nation.

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Special mention

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segregation

The United States is characterized by increasing class segregation—as both a condition and consequence of growing inequality.

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We all know that the share of income going to the top 10 percent has steadily increased since the mid-1970s (from an already-high 33.41 percent in 1976 to an astounding 49.85 percent in 2014). That’s because a tiny group at the top has been appropriating a growing surplus and then distributing a large share of it to the other members of the top decile.

Now we know, thanks to recent research by Sean F. Reardon and Kendra Biscoff (pdf), that rising income inequality in the United States has been accompanied by increasing residential segregation by income:

Income segregation has increased over the last four decades, and has continued to increase in recent years. In large metropolitan areas (the 117 metropolitan areas with populations of 500,000 or more), the proportion of families living in neighborhoods with median incomes well above or below the median income of their metropolitan area has grown rapidly since 1970. . .In 1970, only 15% of all families lived in such neighborhoods, while 65% lived in middle‐income neighborhoods. By 2012, over one third (34%) of all families lived in either rich or poor neighborhoods, more than double the percentage in 1970. Over the same time period the proportion living in middle‐income neighborhoods declined from 65% to 40%.

And, they admit, this growing class segregation is not going to be easy to break:

In an era of very high income and wealth inequality, families have very different resources to spend on housing, and the housing market responds to this inequality in ways that exacerbate segregation. Given the importance of neighborhood contexts for children’s opportunities, and for shaping the experiences of the affluent, rising income segregation will likely only further exacerbate the economic inequality that has produced it. This self‐reinforcing cycle—where inequality begets segregation and segregation fosters inequality—will be hard to break.

Let’s call it the vicious cycle of class inequality and segregation.

As Thomas B. Edsall explains, that vicious cycle is both caused and reinforced by fundamental changes in the American social order and political system: from the fact that the increasingly segregated well-to-do have found ways of supporting and taking advantage of key services (health, education, job search and other opportunities) to aid themselves and their own children to the fact that (as Bernie Sanders recently reminded us) the top decile has been able to exercise much more influence over politics and policy (through voting and political donations) than its share of the electorate would suggest.

And, as we’ve seen in recent months, the combination of inequality and segregation has exacerbated tensions within the Democratic Party:

The “truly advantaged” wing of the Democratic Party. . .has provided the Democratic Party with crucial margins of victory where its candidates have prevailed. These upscale Democrats have helped fill the gap left by the departure of white working class voters to the Republican Party.

At the same time, the priorities of the truly advantaged wing — voters with annual incomes in the top quintile, who now make up an estimated 26 percent of the Democratic general election vote — are focused on social and environmental issues: the protection and advancement of women’s rights, reproductive rights, gay and transgender rights and climate change, and less on redistributive economic issues. . .

Sanders’s extraordinary performance to date. . .points to the vulnerability of a liberal alliance in which the economic interests of those on the top — often empowered to make policy — diverge ever more sharply from those in the middle and on the bottom.

As the influence of affluent Democratic voters and donors grows, the leverage of the poor declines.

Meanwhile, the vicious cycle of class inequality and segregation makes the rich richer, everyone else poorer—and the yawning gap between them continues to grow.

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Special mention

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According to a new study by Diane Whitmore Schanzenbach, Lauren Bauer, and Greg Nantz (citations omitted),

In 2014 more than 15.3 million children—or more than one in five—lived in a food-insecure household in the United States. This is a marked increase from the years prior to the Great Recession, when an average of 12.9 million children lived in a food-insecure household. . .

After the onset of the Great Recession all household types saw sharp increases in rates of food insecurity, with households with children experiencing the largest increase. From 1998 to 2007 an average of 15.7 percent of households with children, 10.8 percent of households overall, and 6 percent of households with seniors were food insecure. The average from 2008 to 2014 was roughly 4 percentage points higher for households overall and for households with children, and about 2 percentage points higher for households with seniors. These changes amount to millions more Americans living in food-insecure households. Despite recent improvements in the economy, food insecurity rates are still higher than they were prior to the Great Recession, potentially reflecting higher rates of poverty and increased costs of other necessities such as housing.

It’s been a spectacular recovery from the Great Recession for a tiny group at the top. For millions of the nation’s children and working-class families, well, it’s meant something quite different—including a great deal of food insecurity.

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According to a new report on the state of U.S. retirement by the Economic Policy Institute, many Americans rely on savings in 401(k)-type accounts to supplement Social Security in retirement. This is a pronounced shift from a few decades ago, when many retirees could count on predictable, constant streams of income from traditional pensions.

Almost nine in 10 families in the top income fifth had savings in retirement accounts in 2013, compared with less than one in 10 families in the bottom quintile. This reflects a growing disparity in the new millennium as the share of families with retirement account savings declined significantly for all except the top income group.

high life

There are still some who believe we’re all in this together. But we’re not, not by a long shot.

When the economy is organized so that the surplus is pumped out of one group (whose wages are stagnant), appropriated by another group (the tiny group of capitalists who sit on corporate boards of directors), and then distributed to still another group (who do all that is necessary to make sure the surplus continues to flow), and the top 1 percent get to spend the expanding surplus it receives on all manner of luxury goods and services—well, you get what can only be described as the Second Gilded Age.

Today, ever greater resources are being invested in winning market share at the very top of the pyramid, sometimes at the cost of diminished service for the rest of the public. While middle-class incomes are stagnating, the period since the end of the Great Recession has been a boom time for the very rich and the businesses that cater to them. . .

While choices for the rich are expanding, the opposite is happening for poorer Americans, according to new research by Xavier Jaravel, a graduate student in economics at Harvard. One explanation, he said, is that there is more innovation among goods aimed at the wealthy, whether it is fancy cookware, natural cheeses or single malt Scotch. Downscale items like canned meat or tobacco see less innovation. . .

Even though this kind of pampering might be good for business, and delight those on the right side of the velvet rope, the gap between the privileged and the rest may ultimately leave everyone feeling uneasy, said Barry J. Nalebuff, a professor of management at Yale.

“If I’m in the back of the plane, I want to hiss at the people in first class,” said Mr. Nalebuff, who has advised many Fortune 100 companies. “If I’m up front, I cringe as people walk by.”

I suppose one can argue we’re all sailing on the same ship—but the ship is clearly organized into separate classes, and the doors between them are kept firmly locked.

Even as the ship itself sinks.